Relationship Between Process Model And Process Description

Posted by Agile Payments on November 25th, 2020

The buzzword over the past few years for SaaS requiring a payments component has been Payment Facilitation, and for good reason ACH Integration. Payment Facilitation provides the opportunity for a frictionless boarding process. Good processing rates can be provided and there’s opportunity for revenue generation for the SaaS organization. The potential downfalls are that any SaaS at its early stage won’t typically be able to support a true payment facilitation model. You’re essentially becoming a payments company and taking on the burdens of customer support, KYC and compliance. The costs of payment facilitation can easily outweigh the advantages of frictionless on-boarding.

Of course there can be managed payment facilitation that can be considered. In this type of relationship the compliance, KYC and underwriting burdens are off-loaded to what would be your Master Payment Facilitation partner. For being relieved of those burdens you will expect to pay a higher processing rate, yet still be able to generate some revenue while at the same time providing your using base with competitive rates.

Lastly there’s the Payments Partnership model for an option. While this model has been around for a long time, technological advancements have recently made this option more attractive. A payments partnership also provides the best option for providing the user base with a good processing rate and also for revenue generation.

Not too long ago the underwriting and boarding process for a payments partnership was to have a SaaS merchant user fill-out a PDF application and wait days or even weeks – and then the on-boarding process was clunky. These days the merchant account provisioning can take place all through an API where a form can be completed on your SaaS site. Underwriting can be near instant because of processor integrations to various tools that perform background, KYC and credit checks. Assuming all information was entered correctly, SaaS merchant users can be boarded within an hour or two. Moreover, API credentials can be generated by the SaaS organization and once their merchant client is approved than can complete what would be the missing piece of the puzzle to enable them for live processing.

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