11 Dec Payments Service Providers – An Introduction
Starting a business can be a rather confusing project, especially when it comes to implementing a payment system. To choose the right partner is critical to ensure a fluid payment system, good conversion and cost efficient procedures. Different options are offered by a number of more or less established organisations, from big players to fintech start-ups. Here is an introduction to the basics of payment service providers’ world.
What is a PSP?
A payment service provider (PSP) is the intermediary between consumers and suppliers. Working as an alternative to the traditional merchant account, the PSP offers to facilitate transactions in a simple manner, with more extensive options fitting different types of companies and generally lower costs. A merchant account is an account where professionals receive and store temporarily their sales funds. In any case, the PSP is responsible for the payment transfer from the moment customers communicate their bank details to the one where funds are transferred . In any case, a PSP offers standard features such as:
- Security, to prevent card fraud
- Accept payments from different types of cards
- Transaction reporting
- Technical support*
Nevertheless different services are provided by PSPs, and the choice of partner depends on the business’ preferences. Operating countries and risk profiles are important characteristics to take in account when choosing the right partner. Several technical details can also influence the choice. For instance, e-businesses could choose to have their clients enter their payments details directly on the website or not, a choice influenced mainly by security and costs. Some PSPs simply provide the bridge between a merchant account and the commercial website, while others such as Stripe will provide a full-range payment solution with an in-house merchant account. Naturally, different service providers will offer different prices, depending on the features offered and on how established and secure the PSP is.
Why and how?
Partnering with an efficient PSP can improve businesses’ key performance indicators. It provides the ability to focus on core business and a safe customer data management. It enables the possibility to accept payments from multiple channels (credit card, debit card, PayPal…) into one place. Enabling a better conversion rate, it also boosts commercial performances.
It is thus capital for the success of a business to find the right partners. An importance ACI Worldwide, leading payment service provider, shared with us. According to General Manager Silvia Mensdorff-Pouilly, “There are multiple ways to work with a PSP. You can find out which PSP best fits your requirements. Many relevant players in the market can be connected to through the network of Holland FinTech. However, there is also a group of relevant players in the market, which can help you arrive at the most effective payment solution. Many consultants are specialized in finding and implementing payment solutions. Some players offer both the solution as well as the guidance to implement the solution, like ACI.”
Wednesday 13th of December: PSP to solve a challenge of a cruise company
On the Wednesday 13th of December, Holland FinTech together with Dinalog and Rabobank is organising a session where logistics and fintech experts will gather to discuss issues in the industry fintech can solve. Payment service providers Paymill and Kable will pitch their solution to answer the challenge raised by a cruising company to provide the adequate payment bridge.
Learn more about this event here.