Payments orchestration: why now? – exclusive interview with Spreedly

What is payments orchestration? 

Payments orchestration is the idea of integrating with and intelligently coordinating all of your payment services in a single platform to deliver a payment strategy that matches a merchants’ business needs. Merchants, platforms, and marketplaces orchestrate payments to support their entry into new markets and deliver greater customer experience and in turn drive a higher return on investment (ROI) from their digital payments. 

What sort of specific customer experience challenges are merchants facing in the payment space today? 

I think there are quite a few challenges that orchestration is able to address. One of the major ones that we've seen – among the problems that Spreedly has solved over time – is expanding into new markets. By enabling payments with over 120 payment gateways, across more than 100 countries, Spreedly enables all of its merchants and customers to connect into new markets seamlessly, so their businesses can expand as they're growing, without a whole lot of friction. 

The next area addressed by orchestration is optimising digital revenue. Using tools like smart routing improves transactions’ success rates and increases customer conversion with enhanced checkout experiences. Orchestration also enables reducing the cost of payments. We do that through leveraging multiple providers, avoiding fraud, and reducing overall operational costs of having to build a solution yourself. 

By leveraging our hundreds of prebuilt gateway connections, PCI Level 1 compliance, network tokenization, and support for evolving standards like 3DS2, all being applied in a single platform, we enable our customers to focus on their core business, while we manage the complexity of payments. 

There is a lot of discussion around the new demands for immediate diversification of payment gateways or types to ensure business continuity. How does payments orchestration help with these evolving needs? 

There are a few discreet needs around connecting to multiple providers. One of the big ones we see is avoiding downtime (if one provider has an outage, not being single-threaded, you are able to shift the traffic instantly to a secondary provider) – and then there’s also the ability to enter new markets (if your current provider is big in North America, but it doesn't have a Latin American presence, or if it is just serving a different segment of customers, you are able to switch seamlessly to a new provider in that geography). This also reduces the risk of trying new partners. It allows greater experimentation when there's not a lot of costs involved in building new integrations – it's easy to just try out new providers. The last thing we see is the ability to smooth volumes during high-traffic periods (such as Black Friday) over multiple providers, to avoid overwhelming a single provider. 

Minimising compliance risk can be a strong driver for adopting new technology. In what ways does payments orchestration limit the regulatory scope for companies? 

There are a couple of different areas addressed by orchestration. The first major one is around PCI compliance. Having a vendor-neutral token vault that provides PCI Level 1 compliance reduces costs significantly – the cost of providing that infrastructure is prohibitive for most merchants to begin working in the payment space. But having that third-party, neutral vault allows you to connect to any provider, and not have your payment methods locked into a single gateway, for instance. 

The other side of compliance is the single point for managing evolving regulations. There are regional regulations we see like GDPR and PSD2 in Europe and then also new card scheme requirements. So there are the Visa and Mastercard stored credential mandates and the shift to zero dollar authorisations for account verification – you can avoid the need to adapt those new technologies across multiple providers and build that yourself, as the orchestration layer can take care of that for you. 

Can you provide an example of where optimisation can directly impact ROI for a company or a specific industry? 

One of our greatest success stories here, at Spreedly, is working with our partner, Rappi. They started in Colombia and had seen massive expansion throughout Latin America. And they have a very interesting payment strategy – they do a lot of experimentation (as I have mentioned earlier), and they have leveraged Spreedly to expand with new payment providers. Rappi is transacting with multiple gateways in each country in Latin America, and they experiment to optimise both success rates and costs, in order to find the best provider for each specific niche in the countries they serve. 

About Lee Jacobs 

As director of product management at Spreedly, Lee is responsible for the strategic development of the payments orchestration platform. He has previously held positions in product management and engineering at Abrigo and Cisco. Prior to his civilian career, Lee served as a Captain in the United States Marine Corps where he specialised in communications. 

About Spreedly 

We orchestrate payments for the world’s most innovative businesses. Hundreds of global enterprises and hyper-growth companies grow their digital revenue faster by relying on Spreedly. Our Payments Orchestration Platform secures payments data and optimises nearly USD 14 billion of annual transactions across virtually any payment service and gateway.