Payment orchestration is the process of managing and optimising all aspects of payments within a business or organisation. It involves consolidating and streamlining payment operations and enabling businesses to offer multiple payment options to their customers – while ensuring efficient payment acceptance and processing.
Payment orchestration platforms (POPs) are software solutions that act as an intermediary between merchants and payment service providers (PSPs), aggregators, acquirers, and other relevant parties involved in the payment ecosystem. POPs offer a unified interface and set of tools that allow merchants to integrate and manage different payment methods, such as credit cards, digital wallets, bank transfers, and alternative payment methods (APMs) – including Buy Now, Pay Later (BNPL) providers.
POPs offer several benefits to merchants, including:
Reduced complexity and costs: POPs simplify the complex process of integrating and managing multiple payment methods and payment partners, which can save merchants time and money.
Improved customer experience: POPs enable merchants to offer their customers a wider range of payment methods, which can improve the customer experience and increase conversion rates.
Increased flexibility and agility: POPs allow merchants to add new payment methods quickly and easily or change their payment mix, which gives them greater flexibility and agility in the ever-changing payments landscape.
Enhanced security and compliance: POPs help merchants maintain compliance with complex payment regulations and protect their customers' data.
Overall, payment orchestration is a critical component of the modern payments infrastructure. However, evaluating different POP providers can be a complex and challenging task for merchants. There are several factors to consider, including:
Features and functionality: POPs offer a wide range of features and functionality, so it is important to select a solution that meets the specific needs of your business. Some key features to consider include the number of payment methods supported, the ability to integrate with your existing systems, and the level of reporting and analytics available.
Pricing: POPs can vary significantly in terms of pricing. It is important to compare the pricing plans of different providers to find the best solution for your budget.
Security and compliance: It is crucial to choose a POP that meets all applicable security and compliance requirements. This includes ensuring that the POP is PCI DSS compliant and that it offers the appropriate level of fraud protection.
Customer support: It is important to opt for a POP that offers good customer support. This will ensure that you have someone to help you if you have any problems with the platform.
In addition to the factors discussed above, there are several other obstacles that merchants may face when evaluating POP providers. These include:
Lack of transparency: Some POP providers do not offer clear and transparent information about their features, pricing, and security measures. Therefore, it can be challenging for merchants to compare various solutions and make an informed decision.
Rapid innovation: The POP landscape is constantly evolving, with new providers and features emerging all the time. This can make it difficult for merchants to keep up with the latest trends and select the best solution for their needs.
Complexity: POPs are complex systems, and it can be tricky for merchants to fully understand all the features and functionalities that they offer. This can lead to problems during implementation and ongoing use.
To overcome these challenges, merchants should carefully consider their needs and requirements before making a decision. Many merchants have chosen to build their own payment orchestration solution. However, before starting with that approach, they should also compare the features, pricing, security, and customer support extended by different providers. It is also important to opt for a platform that is transparent about its features and pricing and that offers good customer support.
Here are some additional tips for merchants based on the experience we have gained at Edgar, Dunn & Company (EDC) when evaluating companies that offer POPs:
Read reviews from other merchants: This can give you valuable insights into the pros and cons of different POP solutions.
Talk to other merchants: Ask for recommendations and advice on choosing a POP provider.
Seek independent advice: This is a great way to learn about the latest trends in the POP landscape and capture a reliable and independent perspective.
Get free trials or demos: This is an effective approach to test out different POPs by using real data before making a commitment.
Since the end of 2020, EDC has been tracking the leading providers of payment orchestration solutions. This has been a challenging endeavour because some are not offering payment orchestration in the true sense of its definition. This is further muddled because there isn’t an agreed definition of payment orchestration. EDC currently has 51 different solution providers on its POP database that claim to be offering payment orchestration solutions.
Evaluating and assessing the appropriateness of 51 different companies that claim to provide payment orchestration solutions – in different ways and in different commercial arrangements – can be a daunting task. These businesses are emerging, and their average age is only eight years old, which means that they are still relatively new, and their roadmaps are not yet fully developed. This can complicate the assessment of which one is the best fit for your specific needs.
Some of the issues that you may face when evaluating these POP providers include finding reliable information about these companies, especially since they are new and relatively unknown. The POP landscape is constantly evolving, with new providers and features emerging all the time. This can make it difficult to keep up with the latest trends and choose the best solution for your needs. POPs are complex systems, and it can take a lot of effort to fully understand all the features and functionalities that they offer. This is not a decision that a finance person should make on their own – but it is beneficial to have a technology expert with considerable experience in the payments industry to assist, a resource that not many retailers have readily available. Some POP providers may not be transparent about their features, pricing, and security measures – which complicates the process of comparing their capabilities.
It is also best to keep in mind that there is no one-size-fits-all solution. The best POP provider for your business will depend on your specific needs and requirements. EDC has found that when evaluating emerging POP providers, one should take into account whether or not they are backed by reputable investors – as this can be a good indication of the company's long-term viability. A provider that is transparent about its roadmap is also a key consideration. This will give you an idea of the company's plans for future development. Also, make sure that the company has a good customer support team. This is important in case you have any problems with the platform after implementation.
Composing an exhaustive and lengthy request for proposal (RFP) isn't practical due to a shortage of available POP providers with the capacity to respond comprehensively. Therefore, opting for a self-service evaluation process can prove highly beneficial. This approach involves formulating a set of specific criteria aligning with your business requirements for a POP provider and, subsequently, appraising potential candidates based on these parameters. The steps involved in this self-service evaluation process are straightforward, yet effective. Initially, you define your essential needs, financial constraints, and security and compliance prerequisites. Next, you compile a roster of potential providers through online research or peer recommendations – or work with an independent specialist consultancy, such as EDC.
Next, you evaluate each provider against predetermined criteria, which may encompass scrutinising reviews, engaging with sales representatives, or accessing free trials and demonstrations. As you progressively whittle down your list to the top contenders, you can schedule meetings and demonstrations with them to gain deeper insights. Ultimately, you arrive at a well-informed decision, selecting the provider that best aligns with your business's unique needs. This self-evaluation process is an agile and efficient alternative to the traditional RFP, allowing you to adapt to the changing circumstances and find the best POP provider for your company.
To maximise the effectiveness of this approach, consider these additional tips. Begin by crafting a concise and transparent set of criteria to facilitate objective and consistent evaluations. Invest time in thorough research, including reading reviews, consulting peers, and participating in sandbox testing to experiment with a short list of POP solutions before making a commitment. Remain open and transparent with providers regarding your needs and requirements to establish a mutual understanding. Lastly, be prepared to make a timely decision, recognising that the POP landscape is in constant flux. By adopting the self-service evaluation process, you empower your business to make informed choices, even when confronted with limited resources and providers capable of responding to a traditional RFP.
EDC has spent the last three years mapping a comprehensive and independent picture of the payment orchestration landscape. Consequently, we have written a guide that can be downloaded from the EDC website, packed with independent, expert advice and recommendations which should be considered when integrating payment orchestration into your business.
Mark Beresford is a Director at Edgar, Dunn & Company (EDC) and has over 25 years of strategic consulting experience in the payments sector. He is responsible for the company’s Retailer/Merchant payments practice, working with omnichannel merchants and payment service providers across the globe.
Edgar, Dunn & Company (EDC) is an independent global payments consultancy. The company is widely regarded as a trusted adviser, providing a full range of strategy consulting services, expertise, and market insights. EDC expertise includes M&A due diligence, legal and regulatory support across the payment ecosystem, fintech, mobile payments, digitalisation of retail and corporate payments, and financial services.
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