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Education

may be replaced with new competitors who are free to
pick and choose where, when and how they will pick off
legacy providers.

Speed of business is accelerating
The digital world is speeding up, and we all need to keep
up or risk relegation to stagnant, low-growth market
segments, or worse. Investors are eager to put their bets on
disrupters – in the first half of 2018, according to KPMG,
U.S.-based fintech companies attracted more than $5
billion in venture capital investment.
As the ground shifts, those who provide traditional
Educating small merchant payment solutions must compete to create an
advantage in the traditional task of finding and holding
on to merchant accounts. That requires the ability to
merchants on smart understand the capabilities of new solutions, learn how to
sell them and train merchants on how to use them. Market
POS solutions research reveals that retail small and midsize businesses
(SMBs) currently do not see acquirers as their leading
source of information on innovative solutions.
By Martina Jeronski Only 14 percent of retail merchants are using the new
AEVI category of multi-app smart POS solutions, but more
than 90 percent have expressed some degree of interest
elling payment services to smaller merchants in these. However, only a small fraction – 4 percent – said
used to be pretty simple. Card payment ter- that acquirers are their primary source of information on
minal options were limited in number and this category of merchant payment solutions. More than
S performed the same basic tasks with little half of those with annual revenue of $500,000 or less said
differentiation. The biggest difficulties lay in explaining they have heard of smart POS systems from other business
complicated fee arrangements. owners. Among larger businesses, the most likely sources
of information are POS vendors.
Today, it's an almost completely inverse situation. Payment
fee schedules are simpler, while choices among payment Bridging the gap
solutions are increasing. For the acquiring community, Merchant payment solution providers should have an
particularly the ISO and merchant level salesperson, the edge in targeting and reaching the 72 percent who aren't
challenge is how to move from selling what is essentially already using smart POS systems and may be potential
a one application (payment) device, to a true business sales. But if the acquiring community doesn't take steps to
solution that incorporates payment with vital customer- educate SMBs on these solutions, it will create openings
facing and back-off business functions. for fintech up-and-comers who can leverage the Internet
for low-cost sales and support.
The good news for the acquiring community is that
small businesses generally are happy with their payment Selling traditional payment terminals and PIN pads
providers. The not so good news is that they're ready to will not be sufficient in the digital age. The world has
make a switch in a heartbeat if they can get a better deal. shifted from a hardware focus to software and services.
In a survey of retail merchants conducted by PYMNTS Retail merchants need to be able to keep up with the fast-
in collaboration with AEVI, more than half of those changing patterns of consumers, who are accustomed to
with revenue up to $250,000 a year are willing to change online price-checking and ordering, mobile payments, and
providers, with price followed by ease of use being the seamless transactions such as hailing an Uber, providing
primary considerations for an alternative. an address, and paying, all in one app.
It is a serious challenge. As we've seen in other industries Merchants, too, want to be able to grow their businesses,
undergoing digital transformation, those who disrupt perhaps through online ordering, ecommerce websites,
old ways of doing things win out over those that don't. and integration with delivery services. And they must
Consider the examples of taxi companies versus Uber, be better equipped to manage their business, with ready
Blockbuster video versus Netflix, or brick-and-mortar access to inventory, supplies, staff management and
bookstores versus Amazon. Familiar foes of yesterday payments reports.

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