Not so long ago, being a Payment Service Provider (PSP) was relatively easy.
They offered a range of activities within and between their platforms and advertised themselves as “one-stop shops” – particularly for payment functions.
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But now, as traders enter new markets and expand their customer base, it’s becoming increasingly difficult to provide everything traders need in one place or through just one or two PSPs.
Ideally, merchants should be able to quickly and securely launch their own offerings – and accept payments – on a case-by-case, market-by-market basis. However, the technological effort required to do this can be both time-consuming and costly, leading businesses to turn to payment orchestrators to take care of everything.
The increasing complexity of at-scale and digital commerce requires PSPs, in turn, to band together to offer merchants a wide range of choices and capabilities – preserving the relationships companies have with vendors while allowing them to forge new ones when needed a la carte fashion.
Partnerships with potential
As Spreedly CEO Justin Benson told PYMNTS’ Karen Webster, a partnership that brings together merchants and the providers Spreedly works with – with Spreedly acting as the “orchestrator of the orchestration” – can solidify payment systems around the world.
In other words, the orchestrators are organized, centralized, and offered to help merchants stay flexible while streamlining their payments.
The company is expanding its Payment Service Provider Program in 2022. Last month, Spreedly announced that European payments company Worldline would join. The program is linked to Spreedly’s platform to offer gateways and PSPs payment orchestration and integrations for easier onboarding merchants and platforms, cutting the process from weeks to days.
In total, Spreedly’s platform currently supports over 120 PSP integrations. When the program launched last year, preferred partners included PayPal and Stripe. For its part, Worldline is focused on payment optimization for merchants, especially those entering emerging markets like Latin America.
past is prologue. Go way back in the last decade, and when mobile payments really took off, merchant businesses were way ahead of infrastructure capabilities, Benson said.
“Payments just weren’t ready yet,” he added.
All sorts of businesses went global, so to speak, creating opportunities for the world’s Stripes, Adyens, and Braintrees to offer end-to-end payment capabilities that merchants were attached to.
More recently, PSPs have adopted application programming interfaces (APIs) to speed software integration, complete large acquisitions, and potentially hamper merchant growth as they transform their own operations.
Changing the mindset on payments optimization
“The idea of payment optimization isn’t so much about single-stack solutions as it is about ‘what do I take and from whom do I build the optimal payment stack for me?'” said Benson.
In other words, retailers have pushed their providers to partner even with competitors to ensure they can market a range of services.
For example, Benson said the partnership model gives stakeholders access to Stripe’s radar, provides access to alternative payment methods, and allows them to expand into Europe. For example, most PSPs differentiate themselves in terms of support for regional acquirers or anti-fraud measures.
“We want our merchants to be able to access all of these services,” he said, while merchants choose what’s important to them — and Spreedly’s responsibility is to maintain those relationships even between competitors driven by anchor tenants like Stripe. to install
The model is efficient for merchants and even larger companies that have in-house payment teams but may struggle with PCI (Payment Card Industry) compliance connectivity.
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As for the future, Benson said Spreedly could well address new use cases emerging in regions like Latin America, including microtransactions and new ways to serve subbank communities where credit card processing fees are prohibitively expensive.
Benson said the checkout process is becoming more of a focus, regardless of the market, as merchants prepare for real-time payments. The company will also look to expand the 120+ integrations already in place.
“Retailers will support things that they think consumers want to use, such as B. Subscription services or donations or restaurant orders,” he said. “If there are signs consumers want something, retailers will knock for value [and Spreedly’s] Services.”