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Posted by Grant Burrall - 08 August, 2022

How To Choose A Payment System For Your Business

Topics: Finance, Management

Payment systems allow your business to take credit cards and other methods of B2B payments. These providers then handle all the backend processing that needs to occur for your business to receive the payment. In this article, we'll see what goes into choosing a payment system for your business.

What Is A Registered ISO?

An ISO is a company that will handle your payment processing. They are similar to the last mile in DSL terminology. ISOs are the businesses that provide you with payment processing tools and usually the first point of contact when something goes wrong or when you have related questions.

ISO means independent sales organization. They are sometimes also referred to as MSPs (merchant service providers). 

There's a chain of events that make it possible for a customer to swipe their card, the coordination of money that gets deposited into the merchant's account and then the amount deducted from the client's bank account or credit card.

At the top is an association, which might be Visa or MasterCard. Next is a major bank, such as Wells Fargo or Bank of America. These are called association member banks or sometimes just member banks. Further down the chain and in a way closer to the merchant is the ISO. Technically, the ISO also has an agent, which is like a salesperson.

The ISO provides the swipe machine and other endpoint payment systems (also called POS - point of sale) to take customer payments.

When visiting an ISO's website, you'll often see something at the bottom such as: "Processor Name is a registered ISO of Wells Fargo" or some other bank name. A single ISO can also be registered with many banks.

How To Choose A Payment System?

It's usually much cheaper to use an ISO than going directly through a member bank, mainly because ISOs are specialists in handling payment processing.

Merchant rates will vary across ISOs. Usually, larger ISOs offer better rates. Although, there are many other factors to consider when choosing an ISO. Service offerings and reputation are two that are very important.

A few features you might want to consider are:

  • Fraud alerts via text or email
  • CVV and address verification
  • PCI-compliant card vault (where applicable)
  • EMV certified (able to process credit cards with chips)

Customized reporting is also another important feature. The following are just a few of the things you'll want to know:

  • How  much money is available to deposit in your account
  • How much money is pending
  • Number of chargebacks
  • Daily volume
  • Customers on a subscription vs. those using single transactions
  • Failed charges due to expired credit cards
  • Highest volume by customer

Having customized reporting allows you to dig into your transactions and discover various patterns, which is critical when it comes to finding what is working and what isn't.

Methods Of Integration Can Vary Across Payment Systems

Most payment systems will offer options for accepting credit and debit cards, which are two of the most common forms of payment. In fact, any payment processor you choose should at least have those two options.

But how easy is it to integrate those methods into your system? Meaning, what is involved with accepting mobile payments? What is involved with accepting payments through your website?

Let's discuss integration with your site first. Integration can be an involved process. The easier a payment system can make this integration, the better. Take PayPal for example, you create a button in PayPal and drop it on your website to begin accepting payments. It doesn't get much simpler than that.

If you need the payment transaction to further integrate with your inventory management system, that process will be more involved. Your inventory management system likely has pre-approved payment gateways (another name for payment system), which it can easily integrate with. If that isn't the case, you'll need to seek a third party integration provider to fill the gap.

These 3rd parties are software platforms. Additionally, you'll need to find a developer who is familiar with the 3rd party and the payment system you are integrating. They'll also need to have familiarity with your website platform (Wordpress, WooCommerce, Squarespace, custom design, etc). The more pieces involved, the more complex your system will be and the more it will cost to make any changes or upgrades.

Accepting mobile payments should also factor in as a required form of payment. This means being able to accept mobile payments on your website and through your mobile phone, usually with the help of a device that plugs into your phone. Payment systems providers will supply these devices.

Website mobile payments can only happen if your site is mobile friendly/compatible. Then the website will also need a mobile-friendly method of payment acceptance. You don't want customers having to type everything out on their phone, which can be difficult. Integrations such as Apple Pay, Google Wallet and various mobile integrations from credit card providers make paying via mobile accessible. Your developer will need to be familiar with the particular mobile payment method to successfully integrate it with your website.

There's a lot that goes into choosing the right payment system for your business. In this article, we've covered many important factors that should help you with this important decision. As you look for a payment system be sure to consider your business's needs as well as your customer preferences. Your customer preferences could revolve around accepting a specific type of credit card, or in many B2B situations, pay using a net payment term.

Net terms accounts receivable


Apruve enables large enterprises to automate long-tail credit and A/R so you can stop spending 80% of your time and resources on 20% of your revenue. We partner with each of our customers to solve their unique credit, payment, and accounts receivable challenges and build the right credit solutions for your markets, customers, and goals. 

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