Visa and MasterCard interchange reimbursement fees are the financial bedrock of the payments ecosystem. It typically equates to the largest expense paid by merchants when accepting credit cards. It’s revenue incentivizes the issuers to create cards and lure new cardholders to their institutions. Companies like Cabela’s and major Airlines began issuing cards to serve as loyalty programs. Cabelas …
As we welcome 2022 with open arms, I would like to make a few predictions for the landscape of payments: Embedded finance and Banking as a Service(BaaS) will grow like a weed. We will see a tectonic shift in banking and finance infrastructure. MasterCard Send and Visa Direct will see massive adoption and breakdown barriers …
The past 15-20 years have given rise to integrated payments and payment facilitation in software platforms. As software companies realized the potential, often of uncaptured payments revenue that existed in their customer base, they ran to develop payment integrations and strategy’s with a wide array of partners. With any legacy providers in any vertical, there …
With Mastercard’s North American payment facilitator registry listing close to 250 companies and companies like Finix and Infinicept touting the ease of implementing, PayFac is at a fever pitch in the software and payments world. This has only been compounded with IPOs like Toast, Lightspeed, Freshworks and Squarespace. Traditional payment processing companies account for net revenue, free of interchange and assessments, where as software companies and …
Accounting for Payment Revenue in SaaS Platforms Read More »
Vertically focused SaaS platforms understand the revenue potential that often hides within their existing customer base. Private Equity companies continue to gobble up software companies, often operating with the thesis that an effective payment monetization strategy will drastically improve the payback period and revenue potential. HONOR is focused on integrated payments and often finds ourselves …
Payments-as-a-Service Companies will claim that becoming a registered Payment Facilitator or PayFac is easy and inexpensive. While ISOs, traditional payment processors and even Stripe itself warn against the pain and high costs. The truth is almost always in the middle, but lets simply look at the data. Mastercard has 248 Registered PayFacs in North America. …
The Importance of Mastercard’s Registered Payfac List Read More »
The payments industry agrees that COVID-19 will accelerate the adoption of contactless payments but it will also add fuel to shifts occurring at the merchant level. Private investment in payments has been driven by many things like great cash flow based on a reoccurring revenue model and defensible technology. Several factors will drive a change …
Integrated Software Vendors (ISV) that choose a PayFac path for their payments strategy, over the long term, can have the capacity to earn more revenue than traditional payment models or referral programs. They accomplish this through varying methods but the three core tenants for driving maximum revenue are adoption, functionality and commercial terms. First adoption …
There are many double standards that exist in the payments industry. The landscape is littered with conflictions laid out from Security Standards Council(PCI), Card brands(Visa, MasterCard, American Express) and the sponsor banks. Companies like Square that have received investment directly from Visa benefit from bias rules created to manage an industry they are often competing against. PCI compliance has …
PCI Compliance for Payfacs and Traditional Acquirers Read More »
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