Merchants must keep up with consumer preferences, even as they constantly evolve and morph alongside emerging technologies. Here’s what merchants expect from payment service providers this year.
Partnering with a PSP, or payment services provider, is a popular choice for merchants, thanks to the ease and speed they bring to payment processing. As an alternative to merchant account providers, PSPs pool their multiple merchants into a single account. They then consolidate their risk and leverage this account to access multiple networks and services, which they then make available to their merchants quickly and seamlessly.
This access to technological features is particularly important in today’s market. In 2022, consumers are demanding more from their merchants than ever before, particularly when it comes to digital services. Mobile commerce has grown exponentially, outpacing desktop with an expected CAGR of 13.8% to 2023, according to J.P. Morgan’s 2020 E-commerce Payments Report. Of these mobile sales, 54% come from dedicated smartphone apps.
Consumer behavioral shifts have had a knock-on effect: for merchants to offer competitive service, they need competitive solutions from their PSPs. Knowing that shoppers want to purchase through a mobile app is one thing, but delivering that solution requires a lot more technical support. Much more will be demanded from PSPs in 2022. Those that can meet and exceed merchant needs will find that the opportunities are vast.
Digital Payments Accelerate
After years of fast growth, there seems to be no sign that digital commerce will slow down. In fact, J.P. Morgan reported that the U.S. E-commerce market has seen double-digit growth since 2017. For merchants, this is an incredible opportunity to capitalize on sales and grow revenue, but only if they can provide the level of service that consumers are expecting. This could mean spending more on technology upfront to set themselves up for success down the road.
With the right PSP partnership, merchants can gain access to new features and integrate them quickly into their platform—all from one source. These implementations will keep consumers satisfied by providing the latest in digital service, while also improving transparency and processing speeds for the merchant. The specifics will depend on the PSP, however, as not all providers will offer the same solutions. Making sure to pick the right partner is crucial for merchants to reap the benefits they’re looking for.
How Automation is Changing the Game
Advanced PSPs know that automation is the lynchpin of software success in 2022, especially when it comes to onboarding new tools and services. Speed is a requirement in today’s market as consumer behavior is shifting fast; if consumers’ preferred services are not available, they are likely to move on to a competitor. Merchants can’t be caught waiting weeks to roll out a new product simply because of an outdated or overly complex onboarding process.
The challenge of integrating new software is that most companies are operating with legacy infrastructures that are not well-suited to add-ons. Modern PSPs have invested in more nimble frameworks, thanks to their larger scale, which then automate the roll-out of new services for their various merchant users. Onboarding at scale also allows for the process to be streamlined and optimized because of greater reporting and insights.
Tried and True Qualities of Good PSPs
Finding a good PSP partner can change the game for merchants who want to thrive in a digital landscape. There are a few key attributes that merchants should look for when assessing future providers.
First and foremost, a PSP must be reliable. When a payment transaction doesn’t go through due to an outage with the provider, the customer does not know who is responsible for the rejection; all they know is that they had a bad experience. Today’s consumers are increasingly demanding and may not give the merchant a second chance. This makes it imperative for merchants to find out how the PSP handles unexpected network issues and assess the platform’s track record in reliability.
One danger with PSPs is that sub-accounts can be less stable as a result of the umbrella account’s combined risk. There is a higher likelihood that a sub-account will be frozen or terminated, which could damage a merchant’s reputation with its customers. Then there are smaller disruptions to service, such as faulty feature rollouts or problems with application access. The faster a merchant can address any problems, the less impact those problems will have on service. A responsive customer support team is, therefore, a necessity.
Payments involve some of the most sensitive and private consumer information. Consumers will simply not trust a merchant that does not guard their data or comply with government regulations. The changing nature of regulations can make compliance difficult, highlighting the need for a compliant PSP. Merchants should verify any protections offered, such as encryption or tokenization, and look into the PSP’s policies for handling security breaches.
Lastly, a good PSP will support a merchant’s growth by committing to innovation and making new technologies available. Not all providers can offer the latest software, so ambitious merchants will want to identify the ones that are investing in digital transformation. This might cost more upfront, but the fast access to in-demand solutions will likely pay for itself over time.
Choosing the right PSP
With so many factors to consider, settling for the right payment service provider will be quite a time-consuming task. That said, it is certainly a beneficial and necessary process in the long run, as failing to do so will result in problems such as recurring fees, poor customer service, high pricing, and limited forms of payments.
Get in touch with our team of payment experts to know how you can opt for the perfect payment service provider.