What is a Payments Service Provider?
Working with the right payment service provider (PSP) is crucial for a business in a digital-first economy. These are third-party service providers who help you build a secure, flexible, and optimized payment solution. And, in turn, to convert and retain customers. There are several advantages to working with a PSP. They help you with instant payment settlements with higher payment acceptance rates. Working with a PSP, a merchant can get started with their online business and start accepting online payments quickly, and often at a lower cost.
Different payment service providers have different approaches and offer various services based on specific business models and needs. Plus, they have various years of experience and levels of expertise. As a retailer, you must know which services are necessary for your business. For example, what type of goods/services does your business sell? Which regions do you operate in? What are your transaction volumes, etc.?
Based on your needs, you can choose a PSP that is best-suited to your business. In this article, we look at five questions that you must ask while choosing a PSP for your business.
1. What payment methods and solutions will the Payment Service Provider support?
Flexibility, ease of use, and need for higher security have made payments a more personalized experience. Real-time transactions, mobile wallets, P2P payments, and other digital payment methods have eased the payment experience for both customers and merchants. Being able to cater to consumer preference is vital for a business to grow. So when choosing a PSP, you must ensure their payment solutions enable you to seamlessly accept payments across the most relevant payment gateways and platforms. Usually, you get a country-specific, multi-payment service via a Payment Service Provider. This lets you offer multiple payment methods based on your customer preference while cutting out the costs of integrating all of them.
Additionally, your PSP will protect you from significant financial liabilities by simplifying the payment process. From minimizing failed payments and chargebacks to managing recurring payments, a suitable payment provider will help you with all your needs. For example, Novalnet supports over 150+ country-specific payment methods in 125+ currencies, helping you to serve customers across the length and breadth of Europe, and beyond.
2. What is the integration process like? Will it work with other software?
As an online business, you will need a good payment gateway to support various payment methods, process payments, comply with data safety laws, and offer a seamless checkout experience to customers. Moreover, there must be a smooth technical interaction between your shop, website, and/or mobile app, and the PSP’s processing software. A good service provider will offer easy integration of APIs with existing software and business processes so that all of your payment processes (including verification and authentication) are secure, smooth, and hassle-free. APIs help different software to work efficiently with one another so that payment information flows smoothly and the payment process is more seamless. The right PSP should be able to offer the APIs, the tech support, as well as smooth and easy integration to get you up and running with your payments within the least amount of time.
3. What level of compliance, data protection, and security policies do they offer?
Protecting customers from fraud and giving them full data security is necessary for an e-commerce business. Current payment laws in Europe require a business to comply with PCI-DSS, PSD2, AMLD, GDPR and BaFin, along with other regulations to protect consumers from fraud and prevent money laundering and terrorist financing. A good PSP will offer you AI-based fraud prevention measures and help you with all necessary regulatory compliances, and risk management services. Their AI risk management tools and other customized features will help you monitor and prevent fraud in real-time, and fully protect your business from any type of data breach, payment error, or chargebacks. With every successful transaction, you will have a secured inflow of revenue coming in.
For example, when you work with Novalnet, we are 100% compliant with all regulations in the EU. Not only that, we offer advance risk management solutions that are based on AI and machine learning, which helps keep your payments secure and give you peace of mind.
4. What markets do you specialize in?
The right PSP should be able to expand your market presence and operate in all your target markets. They should be able to understand your business market and offer services and insights specific to the given market your customers are in. As a business, you need to know what makes shoppers click. An engaging customer experience, especially in cross-border e-commerce, depends largely on the payment experience. And so, your PSP should be able to offer local payment methods, help you partner with local acquirers, and support your business to build up a loyal customer base.
An international PSP works across different countries and has good relationships with local banks and acquirers. They can help streamline your payments and also build the right payment mix suited for your business. They can also perform smart payment routing to increase your payment success and help you navigate local laws and regulations.
5. What add-on support will you offer?
Opportunities and challenges will grow as your business grows. So, it’s good to have a flexible partner who can help you scale your payments as your business grows. You may wish to expand with new ventures and markets, or offer new types of payments or require guidance with tax compliance, payment-related issues, or overall insight and analytics. Your PSP should support you with their expertise and experience in the entire payment value chain. Financial reconciliation, risk mitigation, tech support, and other services that balance flexibility with costs are valuable add-on services. So, how you choose the right PSP will also depend on the level of support you can gain from the partnership.
A smooth, secure, and flexible payment experience is at the heart of a successful business. So, working with a Payment Service Provider should free a merchant from dealing with complex issues related to payment processing. The use of specialized AI-based tech, complying with all requirements of PCI-DSS as well as customized services, enables a merchant to create an optimized payment experience that delights customers.
How Can Novalnet Help
We are a global PSP with years of experience in processing payments for the European industry. Many of Europe’s leading brands trust us to handle their payments. Our tech can help you accept payments seamlessly in 125+ currencies in 150+ country-specific payment methods. Our instant plug-ins get you up and running within minutes and with minimal coding. With our AI-based risk management solutions and advanced analytics, you can securely process payments in a PCI DSS-compliant environment.
Give us a call today to learn more about how we can help with your payments and enable you to become the best in your game.
Jose Augustine is the Chief Business Development Officer at Novalnet with extensive experience in European payment industry and a knowledge powerhouse.