10 Questions to Ask Your Payment Processor
Have you talked with your payment processor lately? Are you taking full advantage of any value-added capabilities they offer – such as multi-currency processing – if they offer them at all?
Retailers and other eCommerce businesses stay focused on product innovation, marketing strategies, market expansion, and customer relationships, but payment processing may not be at the top of the list as a key business driver. However, the performance of your payment platform, good or bad, can have an important impact on revenue flow and other aspects of the business. For example, your payment processor may be inadvertently limiting your business opportunities if their platform does not have the capabilities to help you:
- Expand into international markets quickly and cost effectively
- Eliminate lost sales because of expired or rejected credit cards
- Automate the recurring billing process to avoid revenue bottlenecks
- Give customers a unified payment platform for omnichannel commerce covering in-store, eCommerce, mCommerce, mPOS, and in-app purchases
Here are 10 questions to ask your payment processor and the type of answers you should expect from a provider who can truly support your business growth.
1. How much time and effort will it take for us to integrate with your platform?
The answer you want is “little to none.” Your focus should remain on your business opportunities, not IT integration. There is a myth that integrating a payment processing platform needs to be a complex, lengthy project. But it doesn’t have to be. Your payment processor should be able to provide you or your third-party development team with an online portal to a developer’s toolkit, sample code and development tools for integrating, testing, and even customizing your payment environment. In addition, you should have several integration options and of-the-shelf shopping cart plug-ins to choose from, depending on the nature of your business.
2. Does your platform have multi-currency processing capabilities?
You want to hear “yes” to this question, especially if your business plans to expand eCommerce to international markets or open subsidiaries in other countries. If your payment processor does not offer multi-currency processing, you will need to invest in integrating another vendor just to service that market, not to mention the added costs and time of setting up a local legal entity and a separate bank account in the foreign country. Having all payment processing – both domestic and foreign – on a single platform enables you to act quickly on new international opportunities and gain a competitive advantage in foreign markets. Most of all, multi-currency capabilities enable your business to provide international customers with a “local” eCommerce shopping experience, regardless of geography, since they can purchase products in their own native currency. As a result, multi-currency pricing makes it easier and more convenient for consumers anywhere in the world to do long-term business with you. Still not convinced? Research has shown that displaying prices in a buyer’s native currency can increase sales by up to 12% due to the added convenience and superior shopping experience.
3. How do you handle omnichannel payments, especially mobile, mPOS, and in-app payments?
Beware if your vendor has a separate platform for omnichannel payments or tells you that you need to engage an additional payment processor. Mobile (mCommerce), mobile point of sale (mPOS), and mobile in-app payments can be processed on the same integrated, unified payment platform as your in-store and/or eCommerce credit card transactions. This unified payment experience is what separates successful omnichannel marketing strategies from those that fail, because it provides a seamless customer experience no matter where or how customers purchase, exchange, or return merchandise. The result is happier, more satisfied customers who will be loyal to your business.
4. Is automatic account updating built into your platform?
It should be. The automatic account updating capability should be robust enough to prevent credit card declines from putting a constant drain on revenue flow or delaying recurring subscription orders. Your business will benefit upfront by seeing a significant reduction in the credit card decline rate, while your customers will have a better, consistent and friction-less checkout experience with no delays due to credit card declines. Moreover, you will avoid scenarios where revenue flow is restricted because you cannot bill recurring subscription customers because they have been issued a new or replacement credit card.
5. How does your platform handle recurring billing for subscription plans?
The key word your vendor should say here is “automated” when it comes to recurring billing capabilities. Manually monitoring and managing recurring billing processes can be a huge headache as your subscription base grows and you add different types of subscriptions to the mix. Make sure that your vendor has an automated recurring billing capability that is seamlessly integrated into their omnichannel payment processing gateway. The vendor should be able to handle everything automatically – billing frequency, monthly or yearly intervals, type of subscription plan, free trial periods, and more – based on flexible schedules and parameters you set up with your vendor. As a result, your business never has to worry about losing revenue due to a missed recurring or subscription payment.
6. How do you handle volume throttle between multiple merchant accounts?
Again, “automated” is the key word. Your vendor should be able to automate volume throttle between your multiple accounts to help ensure that you will never exceed the cap and avoid unnecessary fees. The best case scenario is to work with your vendor to create routing rules that best fit your specific business processes and sales cycles. In addition, the automatic volume throttle process should be transparent to you and your customers alike as part of a single, unified payment platform.
7. What types of payment methods can you process?
It’s possible that a customer may want to buy from you, but a payment processor cannot process their preferred method of payment. Surprising as it may seem, alternative ways to pay for goods and services besides credit cards are emerging almost weekly. While Visa and MasterCard dominate the credit card market, there are many other payment options that merchants need to consider including debit cards, especially if you are selling online and to international markets. For example, according to UnionPay International, a subsidiary or China UnionPay, it has issued more than 5 billion UnionPay cards and its online and mobile payment users have surpassed 200 million. The Nilsen report forecasts that UnionPay’s global circulation of payment cards will grow 51% between 2012 and 2017, compared to 28% and 36% for Visa and MasterCard respectively. Ask any prospective payment processor what type of payment methods they can process and ask to see all payment certifications. Any good payment processor should be able to accommodate the following payment types at a minimum:
- Credit card: Visa, MasterCard, China UnionPay, American Express, Discover, JCB
- Automated clearing house (ACH)
- Direct debit
- Alternative payments like iDeal, Giropay, Boleto Bancário
- Contactless payment including Apple Pay, Google Wallet and others
8. How much visibility will we have into your processes? What kind of tracking tools and reports can I access?
You want a payment processing solution that gives you 360-degree visibility of metrics that you can quickly access to project cash flow, track sales by geographic region or subsidiary, track commissions, and quickly resolve chargebacks, just to name a few key business functions. Don’t forget to ask about flexible reporting tools that will provide the information you need for a specific business decision – without having to scroll through extraneous information that is not meaningful.
9. How many types of shopping cart integrations do you support?
Your vendor should support all of the major independent software vendor and value-added reseller shopping cart integrations. It’s an advantage if they offer of-the-shelf shopping cart plug-ins for a fast and simple integration. This usually involves a simple download of the plug-in widget that matches your shopping cart vendor, such as Magento. Your vendor’s integration team should work with you to test and confirm that all transactions are being processed correctly in the cart. Using a plug-in can help you minimize development time and cost, especially for mCommerce integrations.
10. How easy is it to scale your payment platform as my business grows and expands?
You want a payment processor for the long run, so a comprehensive range of payment processing capabilities should already be integrated into the vendor’s platform and accessible through a single API. It should be as easy as flipping a switch to add new services and capabilities. As such, you’ll be able to respond quickly and competitively to changing customer demands and needs, mobile commerce trends, and expand into international markets.
When all is said and done, you should expect your payment processor to offer more than basic credit and debit card processing. An integrated payment platform with a comprehensive offering of value-add capabilities and services is your best hedge against lost business opportunities due to the inability to expand into new markets, meet changing customer demands, and keep up with the demands of omnichannel commerce. In addition to the 10 questions, keep the following quick checklist of value-added capabilities in mind whenever you evaluate a payment processing solution:
- Payment processing for all types of transactions – in-store, eCommerce, and all mobile payment types
- Multi-currency processing
- Automated account updating
- Automated recurring billing
- Shopping cart integration plug-ins
- Dashboard access to metrics and specific reports
- Development toolkits through a single API
Be sure that all or at least most of them are built-into the payment platform so you can have the flexibility to add them quickly as your business needs evolve. That way you can be confident that your payment processing vendor is partnering with you to give your business a competitive advantage across all payment channels – so you’ll always be ready for the next opportunity.