What Can eMerchants Do When a Payment Provider Implodes?
Recent events in the Fintech sector have proven the old adage that history has a habit of repeating itself. Payments businesses are built on reputation and any damage to that reputation can be difficult to recover from. For those businesses at the center, it can feel like the rug has been pulled out from under their feet.
When a payment service provider is suddenly unavailable or not as secure as previously thought, it can throw your business into a state of turmoil by cutting off revenue streams. Building individual connections to payment service providers is costly and time consuming, and if you are not using a payment management system it is likely that your connectivity is reduced and you are locked-in by your provider, this causes issues when one of your providers is suddenly out of action or you no longer feel comfortable using its services. Delays in transaction processing, false positives or declined transactions are just a few of the issues that can be exacerbated.
Another important point is that if your payment provider suddenly disappears, you may not be able to access your customers' payment data. This is not only the case for recurring payments, but for all your customers who have "securely" stored their payment data in their user profile in your eShop. To avoid this, it is advisable to use a PCI certified payment management solution, which, by vaulting the payment data, makes it possible to change the payment provider in seconds, without customers having to re-enter their payment details. By using a multi-acquirer setup, you have full control over the transactions and can set up a multi-level fallback routing.
In order to keep business functioning as usual and not miss out on potential income, eMerchants need to make sure that they are future-proofing their payment solutions. It is obviously not possible to protect from all eventualities but like the fall of empires there are certain things that are predictable and if they are predictable you can plan for them.
What can be learned from high-risk industries?
eCommerce merchants need to make sure that they are protecting themselves. If for any reason a PSP is no longer operational, merchants need to be able to quickly pivot and integrate a new one. Lessons can be learned from industries that are considered high-risk such as Crypto, iGaming, or Forex. Often payment providers suddenly decide that the risk involved with these industries is not worth it and cut ties with the company altogether. Due to this, these high-risk companies have carefully structured their payment solutions in order to prepare for such eventualities. They are therefore connected to multiple PSPs and implement features such as cascading, risk checks, and smart routing. These features allow them to quickly adapt when situations change and not miss out on potential customer conversions. What needs to be remembered is that a payments system is intended to support your business, and not be its achilles heel.
The payments industry can be difficult to navigate and trying to figure out the best solution for your business can be a daunting task. A payment orchestration platform that is provider agnostic means that you will have flexibility with your connections and will be able to integrate new PSPs and alternative payment methods (APMs) quickly and simply. You will also be able to implement smart routing, set risk rules, and run A/B tests across providers. Not only will this protect you if a PSP can no longer work with you but it will also give you access to a wider audience, enabling your company to grow further.
For more information on the benefits of an agnostic payment orchestration platform read this article.
There are plenty of things to worry about when running a business, but with the help of a payment orchestration platform you needn’t let payments be one of them!
IXOPAY is a payments orchestration platform enabling independent, flexible and global payment processing. As a highly scalable and PCI-DSS certified “fintech enabler”, IXOPAY fulfills the needs of large merchants as well as those of “white label” clients: payment service providers (PSPs), acquirers and independent sales organizations (ISOs). The modern, easily extendable architecture offers smart transaction routing & cascading, state-of-the-art risk & fraud management, fully automated reconciliation and settlements processing, comprehensive reporting as well as plugin-based integration of acquirers, payment service providers and alternative payment methods (APMs).
IXOPAY is part of the IXOLIT Group, founded in Vienna, Austria in 2001. With local entities in Austria and the USA, IXOLIT supports national and international customers across various industry verticals. The owner-led and -financed company has grown from 2 to more than 65 employees and is focused on building innovative solutions for eCommerce.
Please find more information about IXOPAY here: https://www.ixopay.com
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