The advancements in payments solutions in the U.S. over the past five years have been dramatic. Value-added resellers (VARs) and managed services providers (MSPs) that haven’t considered reselling payment services for a few years will find a whole new slate of functionality and features that they can offer to their clients today.
Shawn Prasaud, Senior Product Manager, EVO Payments, answers questions for solutions providers about what’s new, what’s in demand, and what to look for in a partner that can make adding these solutions to your line card easier.
How have payment processing solutions changed in the past five years?
Prasaud: The obvious disruptor for the U.S. has been EMV. The 2015 liability shift forced EMV adoption in the U.S. in most industries, with the exception of petroleum, which goes in to effect in October this year. Payment solutions had to be adapted to accept chip cards. From a processor perspective, this means either:
- Recertifying existing solutions to accept EMV on our processing platforms, or
- Providing semi-integrated solutions to our software partners to ease the certification and migration burden
We continue to see more changes from the schemes. While Credit PIN still isn’t a popular option for U.S. issuers, we’re seeing more cards issued with contactless capabilities. This is a good thing, as digital wallets still have a slow adoption rate—only 1 in 4 consumers.
Which demands are trending among omnichannel merchants?
Prasaud: We’re seeing more and more merchants accepting payments via online/web and, thus, requiring solutions for card-present as well as card-not-present and card on file. Card on file seems to be a growing need. Having a card on file for regular customers reduces the friction for payments and allows the merchant to focus more on customer service.
Are mobile payments growing—and what can help increase adoption?
Prasaud: Adoption rates in the U.S. are still low (1 in 4). In order for mobile payments demand to grow, consumers and issuers need to adopt contactless payment methods. Issuers are only now starting to issue contactless-enabled cards. This may be due, in part, to some issuers realizing that contactless may be a way to speed up EMV transaction processing times.
What are some features of a payment solution that VARs and MSPs need to consider today that they may not have looked at in the past?
Prasaud: We are seeing a trend towards cloud processing. Many ISVs have ported their point of sale (POS) applications to the cloud, making software installation fairly seamless to the users. POS processing solutions need to be able to accept requests from cloud-based POS applications as there usually isn’t a connection between a POS application and a POS terminal that are inches apart on a counter any longer.
VARs and MSPs also need to research the available security features of any solution. At a minimum, the solutions should have P2PE (point-to-point encryption) and tokenization, two must-have features. P2PE will ensure the primary account number (PAN) data is encrypted while in transit to the processor, and tokenization will ensure the PAN data is obfuscated while at rest with the merchant.
Are there features designed to make doing business easier for payments partners?
Prasaud: Online reporting and self-service are two main features of a processor’s solution that can make life easier for everyone. Additionally, ISV specialized service, when needed, is a must-have. In recent conversations with ISVs and software resellers, we’ve found that while commissions and residuals are what keeps things afloat, these three services typically outweigh compensation.
Choose a partner that specializes in partner relationships and service.