Everybody's Got A Solution By Chuck Riegel, EVP, Software Products & Partners for Payment Processing, Inc. (PPI)
Over the last 12 months, the activity surrounding integrated payment processing has accelerated to the point that every provider of merchant account services is offering or trying to offer an integrated payment solution. Why has the focus on integrated payment solutions increased so dramatically from merchant account service providers? Simply stated, businesses are demanding integrated solutions. But what's fueling the demand?
In our opinion, the answer seems clear: Businesses are requiring integrated payment processing because it is the only way to manage the aggressive growth they are seeing in electronic revenue. As a stand-alone process, large volumes of electronic payments are error-prone and an administrative burden. The demand for integrated payment processing has increased because the number of consumers using electronic forms of payment has increased.
Much of this new payment activity can be attributed to credit card usage. Do you know anyone who doesn't have a rewards card? Everyone wants their free miles or gift points at their favorite store. Personally, my favorite card is my L.L. Bean card. Does it get any better than free fishing gear? In addition to increased credit card usage, the use of debit cards has seen dramatic growth and will continue to grow, which adds to the overall volume of electronic payments.
We conducted interviews with businesses that have switched from a stand-alone system to an integrated one, with the goal to understand exactly how integrated processing had addressed the ability to manage this increase in electronic revenue. There were four common themes that were noted as the main reasons businesses selected and implemented an integrated solution:
Reduce errors in payment data entry
Improve reporting
Reduce administrative tasks
Improve training for unskilled labor
Overwhelmingly, these business owners said their integrated system provided significant relief by addressing these problem areas. They were able to quantify the monthly financial impact, reported an improvement in customer care and recommended other businesses consider the switch. Much like the old Nike commercial, the most common advice they offered a business considering this switch was: "Just Do It!"
Providing integrated solutions requires a significant investment in technology and technology personnel. For a company providing payment services, this is an enormous undertaking and one that cannot be addressed by merely reselling a technology vendor's integration technology. To provide a complete solution for software developers, VARs and businesses integrated solution providers must make a significant investment in technical staff and technology solutions. This is no small hurdle for companies that are mainly resellers of financial services. To succeed, they must become technology and financial services providers. This combination of electronic payment technology and merchant account services is a marriage of two completely different environments, but a combination that is necessary to provide stable and well-supported integrated payment solutions.
The challenge for VARs and software developers is to partner with an integrated payment processing company that can provide technical services and stable, proven technology in combination with a full range of merchant account services. It is only with this comprehensive offering that the range of products and services necessary to support these new integrated solutions are possible. If they don't find the right partner, software developers and VARs will have to deal with a significant increase in support costs, customer dissatisfaction and half-baked solutions.
However, the opportunity for software developers and VARs is the ability to capture a booming market expansion and one where additional revenue streams can be significant. Software developers and VARs really can't choose to ignore this demand any longer. Pick your partners carefully. The right partner will result in increased revenue and satisfied customers. The wrong partner will cost a lot of time and money.
Chuck Riegel is EVP, Software Products & Partners for Payment Processing, Inc. (PPI). A technology management veteran with more than 20 years of experience, Riegel manages PPI's strategic sales, software partnerships and technology initiatives.
Over the last 12 months, the activity surrounding integrated payment processing has accelerated to the point that every provider of merchant account services is offering or trying to offer an integrated payment solution. Why has the focus on integrated payment solutions increased so dramatically from merchant account service providers? Simply stated, businesses are demanding integrated solutions. But what's fueling the demand? 
