Since the inception of payment facilitators, merchant acquirers have had to change the way they operate. With the correct form of synergy and collaboration, payment facilitators can be an extremely beneficial and profitable form of business to any Merchant Acquirer. There are many companies now solely suited to add value to the merchant acquirer and payment facilitator relationship by providing mutually advantageous solutions to all parties involved. So how exactly can acquirers and payment processors offer customised solutions to its current PayFac clients and attract new ones. Such solutions that will enable them to accept and process credit and debit transactions faster and easier.
The first step as in any marketing campaign is to know your customer, what are their needs and challenges faced in an often-turbulent financial market.
Whether it be merchant onboarding, reporting or fraud detection and security of transactions, payment facilitators need constant support to increase their processing volume to become not only viable as business but also profitable for an acquirer.
Here are just a few of the areas in which acquirers must provide excellent services to improve the payment facilitator model and they are also the type of advantages a payment facilitator should look out for when deciding on which merchant acquiring platform to operate on.
Above all whatever model you as a payment facilitator are required to keep in line with, there should be a considerable degree of flexibility. Your business is able to accept payments across a variety of platforms.
Examples of major payment transaction include:
• Credit and Debit
• Check or Pin/Pin less
• JCB and PayPal
• Visa, MasterCard, Discover, and AMEX.
Always ensure that whatever solutions are offered, they must allow full control over the way in which your business operates, including how transactions are processed and the way your company’s brand is transmitted to the financial market.
In general, this process takes 3 to 5 days. Even professional merchant acquirers who have the resources and skill to deal with onboarding find this process quite arduous. One of the main factors on whether a PayFac is able to remain sustainable is determined by the amount of risk they are able to assume on behalf of their sub-merchants. Payment processors will already have a large database of past payment defaulters and those high-risk businesses who have history of bad credit.
They possess tools to onboard merchants quickly by being able to asses they way in which they operate in terms of their online presence by analysing their past account history. Thus, allowing you as a PayFac to make a much more informed decision.
More and more platforms are allowing PayFacs to carry out merchant onboarding, through an API or merchant file format. Both options operate with MATCH and OFAC compliance, that allows for on the spot onboarding and real-time compliance checks as well as Development of merchant ID’s.
Customer Support Services
Support comes not only in the form of new software but also the availability of well-trained customer support, who are equipped with a specific skill set to detect and prevent possible fraudulent transactions, especially the likes of which might cause your business to go belly-up. This effectively affords you more time to focus on helping your business move forward with the feeling of having a powerful security net to catch you before you fall.
These individuals are trained to check whether or not sub merchants comply with the rules and regulations of the umbrella acquiring company and also to determine whether their might be any legal infringements which might land all parties involved n hot water.
Batch and Real- Time Processing
Payment Acquirers should also provide ACH (Automated House Clearing) Transactions, which are large credit or debit batch transactions. There are two main type of transactions processed either batch transactions or real-time transactions.
• Real- time transactions are processed one at a time as they occur and are usually one at a time.
• Batch transactions are those which are similar and occur on a large scale and can be tracked at the same time. This type of processing is perfect for those transactions which reoccur on a monthly basis.
Since these are often on a very large-scale, payment facilitators often require greater support in this area from acquirers who deal with this daily and in much larger volumes. PayFacs must employ the services of a processor who is able to manage and process files of such a great magnitude.
Payment Facilitators often lack the experience and know how to deal with chargebacks. These are disputes that occur between the cardholder and the payment facilitator. This happens when a cardholder queries a deducted amount that has already been transferred from their account. The subsequent amount is then withdrawn back by the client resulting in a shortfall for the payment facilitator. A good payment processor will already have their own portal for dealing with such chargeback issues.
As seen above there are many stages in which transactions and business patnerships can go askew. In this regard, detailed reporting is required to determine where your business may be at risk or posses some area of weakness which requires improvement. Such applications allow one to improve operational efficiency while managing risk and increasing profits.
Detailed reports on all processed transactions should be available on request and at specific intervals so that you can deduce certain positions about how much profit you are able to generate and exactly what sort of rates each transaction is processed for.
Major acquirers and payment processors are in constant contact with a wide-ranging network of financial services providers and players. These resources should be utilised wisely. It would be foolish to assume that a beginner level payment facilitator could fare well competitively in such an overdrawn market. Collaboration is key, and these businesses can flourish if they are confident that their payment processing is being dealt with by a financial partner with global capacity in a manner that is well integrated, efficient and secure.