The economy is set up to allow businesses to run online without a physical address. The only challenge they have to solve is how to receive money from their customers. But the solution to that is simple, a merchant service provider.
Merchant services providers offer a hound of services to benefits allowing them to run smoothly, maintain a steady stream of cash and make it easier for their customers to make payments for the goods they pay on their website.
If you’re one of those businesses struggling with online payments, we are here. We know merchant services providers can be a confusing topic. We will help you better understand what we do and share some of the features that make Pay iO an excellent MSP.
What is a Merchant?
Historically, merchants were traders sailing worldwide to sell gold and spices. But currently, a merchant is a term used within the e-commerce space to refer to businesses that sell goods or services in person or online.
Who is Considered a Merchant?
Merchant is a broad term that refers to different types of people or companies selling goods or services. Some types of merchants include:
- e-commerce merchant – A merchant who sells items or services online
- retail merchant – a merchant who sells items that they purchase from manufacturers
- wholesale merchant – merchants or manufacturers who sell items to retail merchants
- affiliate merchant – A merchant who uses affiliate networks to sell goods
- Direct-to-consumer merchant (DTC) – A merchant who sells items that they themselves create directly to the customer.
What is a Merchant Services Provider?
A merchant services provider is a financial services software partner that facilitates the accepting and processing payments for the merchant. The provider acts as a mediator between banks, customers and merchants, making credit and debit card transactions possible.
MSPs have various business offerings, including digital payments, technology integrations for transaction tracking, POS services, CRMs, business data understanding and collection of outstanding invoices. Of course, the range of services you can get from your MSP will depend on your chosen provider.
Understanding the features and capabilities of the MSP will help you develop the right payment processing platform for your business needs. At Pay iO, we focus on open banking and digital payments.
Merchant Account Provider Vs Merchant Services Provider
As you go through our services, you will notice that we are also a merchant account provider, which can be confusing because the two entities overlap quite a bit. But there are some distinctions between a merchant account and merchant service providers.
Merchant services provider is a broader term used to describe an organisation with various offerings for merchants that span payments, technology integrations and business services.
Merchant account providers, on the other hand, help businesses set up their merchant accounts, which is the type of bank account that enables you to accept debit and credit payments.
However, in many cases, you will find these terms being used interchangeably. Before honing in on one provider, it’s essential to clarify the services you’re looking for and determine whether they can provide the same competently.
Types of Merchant Services Providers
Merchant service providers are divided into three primary categories depending on the services they provide to businesses. These are;
Merchant account providers
The core business of merchant account providers is to provide businesses with a merchant account. This is one of our main offerings at Pay iO. The merchant account holds funds while authorisations are made. The account helps businesses accept credit and debit cards. The merchant account services are offered by banks, payment services providers and payment gateway providers. You will get a dedicated or aggregated merchant account depending on the type or merchant provider you choose.
Payment service providers (PSPs)
A PSP is a company that provides merchants with the technological infrastructure and services to accept, facilitate and manage credit cards and other types of online and offline payments. Besides processing transactions, PSPs provide other services like PCI DSS compliance and fraud protection. They also allow merchants to accept payments without a dedicated merchant account, saving them money on account fees and eliminating the hassle of applying for an account.
Payment gateway providers
A payment gateway is a software application allowing merchants to accept and process transactions through their website or Point of Sale for physical merchants.
Payment gateways service as the front-end interface between customers, payment processors and banks. The gateway sends the payment date inputted by the customer to the processor and then communicates the authorisation with the merchants and the customers. This is one of the services that Pay iO offers.
Many payment gateway providers also offer other merchant services to help businesses customise their checkout, get customer insights and remain compliant.
Most MSPs offer all three types of merchant services, while others, like Pay iO, have selected the fields they want to specialise in to offer merchants the best services in those fields.
Merchant Services Providers Products
The type of products you get with a merchant services provider will depend on the package and type of service you choose. Some companies only offer you processing services, while others will help with other things like PCI compliance and protection from chargeback fees.
Some of the products you can get from a merchant services provider to make it easier to run your store include;
Merchant account
These are essential accounts that act as a middleman between your business’s bank account and the customer’s. Full merchant accounts give an identification number to help you protect against issues like fraud. You can also accept payments with a payment service provider account, but this doesn’t offer the same level of security. The merchant account is where the money from your customers will be stored before it is deposited into your bank account.
Credit card terminals
Retailers with brick-and-mortar stores need credit card processors you can use with customers in person. You can get the card reader from your merchant services account providers. Paymer service providers can also provide terminals, with some having unique card read options.
Different terminals have different features. Some allow you to take contactless or pin-free payments, while others support smartphone payments.
Payment gateways
This is another common feature that you will get for merchant accounts and payment service provider accounts when you work with Pay iO.
A payment gateway acts as a bridge between the service provider’s processing network and your website. It makes it possible to take payments over the Internet.
Virtual terminals
Virtual terminals are software solutions delivered over the cloud. They can turn iPads, tablets or computers into portable POS systems. You can manually enter transactions into the system or use a USB-connected card reader. These can be helpful if you want to attend festivals and set up pop-up shops.
Online shopping carts
You can also get an online shopping cart software with your merchant service provider. But in most cases, your eCommerce shite building tool will be the best place to go for shopping cart software. However, it’s worth ensuring your cart is compatible with your merchant service provider before investing.
Merchant cash advances
Some merchant services providers can give you access to extra cash when you need it. In return, you might have to give back some of your earnings to the company you borrow from until you repay what you owe. These advances are different from loans because there isn’t a set amount you need to pay every month. It varies depending on your sales.
Choosing the Best Merchant Services Provider for Your Business
Seeing how crucial a merchant services provider will be to the success of your business, you can take any chances by picking the first MSP you see. You want to choose the best one, and because it’s not a one size fits all, there are factors you should consider to help you identify the right one.
Assess costs and request quotes
One of the easiest ways to sort through the hundreds of MSPs you will be vetting is to look at the costs. The costs are usually small per transaction, but considering the number of transactions you will process in a day, the costs will add up drastically. The goal is to find the most competitive rates and, where possible, go for the lowest processing fees. Assess the costs involved if you want additional features such as POS systems, CRMs and others.
Your industry
The industry you operate in is an important factor to consider when choosing an MSP. It dictates the customers you serve, whether you serve them online or offline and their payment preferences. An ideal MSP will most likely specialise in your industry and understand your business model, your general payment processing needs and timeframes. They will also understand your customer’s needs and expectations.
Business size
Your needs will vary depending on the size of your business. Small, mid-sized and large businesses have different needs when it comes to payments. If you run an SME, you shouldn’t go for a merchant services provider that typically works with large businesses. It’s best to choose a provider that offers more hands-on support and understands the needs of your business’s size and can work with smaller budgets.
Markets of operation
Consider the markets you operate in currently and where you plan to expand in the future. Doing so lets you narrow down on the merchant service providers specialising in these markets. The providers should provide the most popular payment methods in these markets and give insights regarding payment processes, customer needs, and expectations.
Integration
You will need to find out what is required to set up and integrate with a payment provider in terms of technology and skills. Some providers have extensive requirements that take a lot of time that can cause your business massive losses during the transition period.
This factor is often overlooked, yet it can have a massive effect on your operations. An ideal option for merchants, especially those with a small budget and little technical know-how, is to choose a provider with quick and easy set-up solutions and seamless integrations into your current website and other systems. With such providers, you save time and money.
Look at the features
Once you shortlist merchant service providers within your budget range, you can explore their range of features.
Most providers offer premium and modern features to will prove valuable to your business. The features can range from tracking to same-day funds to accounting software integration or other premium features. These additional benefits can be powerful for growing businesses.
Speed is vital
No business wants to wait weeks to access funds from complete sales. You need to partner with merchant services providers that offer quick bank deposits. The good news is the disbursement of these funds is at its fastest currently, making it easy for businesses to maintain liquidity to keep their orders coming in and going out.
Explore the deposit timelines and double-check if they have same-day deposit options. Some might also offer instant deposits at an increased cost.
Security
Speed shouldn’t compromise security. Ensure your merchant services provider uses the latest security measures to secure your transactions and customers’ information. In the same breadth, it should be easy to access your money and deal with any emerging complications.
User reviews
Just before settling on one MSP, take a minute to review the user reviews of all the finalists. Ensure the provider has a good reputation for their services and customer support.
Who is the Best Merchant Services Provider?
Ideally, you would have to look into multiple merchant service providers during your search. Some merchants are lucky to find the perfect match on their first try, while others are always searching. You can save yourself the worry and constant searching by partnering with Pay iO. With us, you can finally get back to growing your business while we provide you with the features and support you need to get your payments and finances in order.
Pay iO has tried and tested technologies that will make it easier and smoother for merchants to send and receive payments. With Pay iO, you have an MSP that is obsessed with making payments for merchants as easily and as transparent as possible, so you don’t have to.
Why You Should Work with Pay iO
Pay iO ticks on most of the features and needs that most merchants are looking for in an MSP. With our experience in payment processing, open banking and payment gateway, we are the partner you’ve been looking for to help you revolutionise how you receive payments in your business. Here are some of the outstanding features that Pay iO offers;
Easy access
Accessibility for you and your customers is a crucial factor. Customers often abandon their carts if they can’t access payment options easily. You can access Pay iO through the mobile app and on the web. We have apps on Appstore and Google Playstore. Our responsive website and apps ensure you can keep tabs on the financial health of your business wherever you are. You just need an internet connection.
Small business features with big business thinking
Small businesses rely heavily on timely payments to maintain cash flow and survive. You can cut costs by getting bank payments directly from your customers and managing your transactions and expenses in one place. You don’t need to have an entire financial team helping receive payments with our help. You have everything you need neatly organised so you can understand the financial health of your business at a glance.
With fast payment processing and multiple payment options present, your business can receive payments quickly and make payments to suppliers efficiently to keep you growing.
Big business capabilities with the touch of a small business
Big businesses have higher demands and requirements. They must send and receive payments globally and manage everything from one convenient account. Like small businesses, big businesses also love saving money, and we can help you with that by helping you cut back on administrative time and effort.
With the ability to process payments in multiple currencies, you can receive money in over 50 currencies and convert it to your local currencies. You can also open different currency accounts that will make it easy to manage different currencies and save you money in foreign exchange rates.
The beauty is in how we handle our big business clients. They get the same responsive and hands-on customer support to ensure problems are quickly fixed and you go back to your smooth operation.
Modern convenience
You can create a digital wallet, and a dedicated bank and business card details online hassle-free. You get to enjoy the convenience of the fast-moving online financial world. You can access your account and make payments anywhere in the world. Your business never has to go to sleep because business hours are closed. With Pay iO, you can realise your dream of being a 24/7 entity.
Currency exchange rates
Big and small businesses making money in multiple currencies can always expect to get the real mid-market rate with just one low fee to exchange currencies. With the volume of transactions your business handles in a day, you can save thousands of pounds in exchange rates, which can cover other overheads or increase your margins.
Simplicity and instant access to open banking
Pay iO easily integrates next-generation payments into any application. We will help you turn complex payment infrastructure into a simple code allowing you to focus on building better payment services. Your customers can enjoy swift, convenient, secure payment options from their phones or computers. You never have to miss out on a sale again because your provider is having difficulties. Should you find yourself in a bind, we have a responsive customer support team that will help solve any challenges quickly within the shortest time possible.
The latest security features and technology
We deploy the latest security features and technology to safeguard your money and your customer’s financial details. We use 2FA, biometrics and end-to-end encryption and other security technologies to ensure we provide you with peace of mind.
Rapid onboarding process
Time is money. That is why we try to keep things simple and make the onboarding process as quick and as easy as possible so you can start receiving payments on Pay iO in as little as 24 hours instead of taking weeks and causing your business substantial losses.
You can contact us for more information on how Pay iO can help your business grow and take advantage of emerging payment technologies as well as merchant services provider products.
How to Apply for a Merchant Services Provider
Applying to have Pay iO as your selected merchant services provider is simple. You can complete the process in five quick steps, if not less.
Prepare your documentation
You will need several verification documents when applying for your merchant services provider account. Ensuring you have the right documents beforehand will prevent unnecessary delays and make the registration process faster and easier. Some of the documents you will need include;
- Bank statements
- Photos for identification
- Tax information
- Incorporation information
- Information about your business website with all your business details clearly displayed.
Apply for an account
With your business documentation ready, you can head to our sign-up age to apply for your account. The application process is entirely online, so you can quickly apply and upload soft copies of your business. We’ve watered down the process, so there are only a few steps to complete.
Wait for a decision
We will review your applications. It’s not automatic that your application is approved, but we have an exceptionally high approval rate, so there’s a good chance your request will be approved. The underwriting process may be longer if you’re also applying for a traditional merchant account. The approval times can vary depending on the size of the business, but in most cases, we can get it done within the same day. However, don’t be deterred if you don’t hear back immediately.
You can make the process easier and more efficient by providing us with as much information as possible when signing up to avoid a lot of back and forth, which will take more time.
Begin processing
Once we approve your business, you will be up and running in no time. Your business can accept credit and debit card payments. You won’t need to rely on cash payments to fund your operations anymore.
Maintain good payment practices
Once you start processing payments, it’s crucial that you maintain good payment practices. Not doing so can lead to loss of your merchant account.
If you have too many chargebacks, we might consider cancelling the account. We offer chargeback prevention tools and other security resources that can help to mitigate such occurrences.
