The perfect checkout scenario: How Payment Orchestration benefits both merchants and customers

Gox Mailer, Chief Strategy Officer at IXOPAY has provided insights into the benefits of payment orchestration for both merchants and end customers.Definition of payment orchestration in today’s market

When we use the term 'payment orchestration' today, we typically mean a layer between the POS/Shop System of a merchant and the payment methods it is offering to its customers. After years of relying almost exclusively on PSPs and aggregators, today’s enterprise merchants have realised the importance of controlling the payment processing infrastructure themselves, taking control not only of fraud prevention and risk management, but also being able to utilise smart routing in order to reduce fees, increase acceptance rates, and utilise tokenization to streamline recurring billing, while avoiding provider lock-in.

It can surely be said that it’s no longer a trend, but rather a best practice to use a payment orchestration platform. It’s not easy for individual PSPs to live up to their 'just integrate our platform and be set for life' pitch. Merchants of today are better informed, often need to consolidate multiple legacy systems and want to enter new markets quickly without having to update their internal processes when they do so. 

What has further accelerated this shift is the big wave of consolidation we have seen in recent years in the processor, acquirer, and PSP space – there have been countless mergers and acquisitions, many of them citing 'synergies' and 'optimisation' as main drivers for such deals. In reality, the more relevant factors are the acquisition of additional volume and market share – there is rarely a priority on efficiency. The process of consolidating multiple legacy platforms typically is a time-consuming one. Due to this, merchants are often left with the same challenges they had initially – having to deal with multiple, disparate payment platforms themselves, even if these platforms are now under the same ownership.

Benefits from a merchant’s perspective

On the post-processing side of things, the benefits of using a Payment Orchestration Platform as a Service for merchants are clear: they instantly have access to centralised settlement control, reconciliation, and risk management over all their brands and payment methods. They can minimise their exposure to regulatory issues like PCI compliance, GDPR, and PSD2/SCA while maintaining maximal control over their payment data.

In addition, they do not have to worry about adding new payment methods to their portfolio or maintaining API changes in existing ones and, of course, smart routing helps them keep MIDs 'healthy' and cross-border fees low.

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Additional benefits for customers

An often overlooked effect of applied payment orchestration, however, is the streamlined checkout process for the end-customer. Presenting them with country-specific payment methods and prices in their local currency improves not only conversion, but also the user experience. 

At IXOPAY, for example, we put a strong focus on the incorporation of merchant-specific data into this process (think 'VIP Customer Flags' or 'Manual Review' between Authorisation and Capture). A feature we call 'Customer Profiles' optimises the checkout process even more by letting the end-customers store and prioritise the payment methods they would like to have on file, which can then be presented in a format optimised for the relevant client device – all this while never compromising on security, thanks to dynamic risk scoring in the background. 

General trends and summary

Customer access and customer loyalty remain highly important topics for merchants – especially in times where large players such as Amazon increasingly succeed in 'going full 360' and closing off their ecosystems, your check-out process needs to be state-of-the-art and not merely a lot of payment logos in a row. Furthermore, user experience is a cardinal requirement for modern consumers to make an emotional connection with a brand, potentially resulting in win-win situations if merchants can provide tailor-made special offers to their clients based on the data provided during the checkout. 

Disruption is also approaching the point of sale: SoftPOS is coming of age, increasing numbers of 'brick and mortar' stores implement customer loyalty programs, stored payment methods, 'floating cashiers' and self-scanning, further blurring the line between 'card present' and 'card not present'. 

Lastly, even the card schemes, through EMVCo, have realised the potential of this topic and are now trying to address the very large ecommerce customer segment known as 'Guest Checkout' with the introduction of Secure Remote Commerce, for which initial specifications have just been released last June.

The payment space is changing at an ever-increasing pace – almost as quickly as customer expectations! As a merchant, you should stay on top of things and get closer to the perfect checkout by opting for advanced payment orchestration now – your customers will thank you.

 

About Gox Mailer

 Gox, Chief Strategy Officer at IXOLIT Group, looks back on a strong consulting background in various     positions in the IT, both on the supplier and the client-side. In the last decade he has put a strong focus on   online payments. He has joined the IXOLIT Group in 2010 to help it enter this space, advised enterprise   clients, handled strategic business development of the internal PSP, expanded strategic partnerships and   spawned the development of the IXOPAY Payment Orchestration Platform. Connect with Gox on  LinkedIn. 

About IXOPAY 



IXOPAY is a highly scalable and PCI-certified payment management platform for White Label Clients and Enterprise Merchants. The modern, easily extendable architecture enables the orchestration of payments, provides intelligent routing, and cascading functions as well as state-of-the-art risk management, automated reconciliation, and settlements along with plugin-based integration of acquirers and PSPs. IXOPAY is part of the IXOLIT Group, which was founded in 2001 and maintains national and international customers from Vienna, Austria, and Florida, USA. The owner-managed and financed company has grown to an IT specialist with over 60 experts developing innovative solutions and products.