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November 27, 2022 • Issue 22:11:02

Integrated payments are

here – are ISOs ready?

opportunities. Payment processing fits the bill, but building
out the technology to become a payfac is costly and time-
consuming. This, in turn, has opened up opportunities for
ISOs and their technology partners.
"It's a competition, so [ISOs and acquirers] better get mov-
ing quickly," said Vijay Sondhi, CEO of the payment pro-
cessing platform NMI.

The heart of the matter
"Software is the heart of a business," said Gary Liu, presi-
dent of the ISV/VAR channel at Bold Integrated Payments.
"And payments need to be integrated with that."

Liu understands first-hand the value proposition. He co-
created a POS system, called HotSauce, which began rolling
out to the hospitality sector in 2002. HotSauce soon began
By Patti Murphy working with ISOs for payment processing services, rev-
eling in the opportunity to collect recurring revenue from
o the ongoing list of threats to the ISO and agent these deals. But there was a downside: a dearth of infor-
channel, add software companies. But here's the mation in the monthly statements HotSauce received from
good news: ISOs and their channel partners have these ISOs.
T an opportunity to get in front of this threat by
partnering with independent software vendors (ISVs) to "They couldn't reconcile every income item and every ex-
integrate payment processing into their software. pense down to the penny, down to the interchange level,"
Liu said. That's when he decided to launch his own ISO,
"We're seeing a pretty dramatic acceleration in the sense
of urgency ISVs have for getting payments integrated,"
said Caleb Avery, founder and CEO at Tilled, a payfac-as-
a-service startup based in Denver. "ISVs are increasingly Contributed articles inside by:
interested in working with ISOs."

Some of these companies already integrate with payments Ken Musante ..........................................................................................14
company Stripe or PayPal's Braintree, Avery noted. These
managed payment facilitators were easy to implement Sumeet Puri ............................................................................................17
early on, and pricing was transparent. But as businesses Bryce Van De Moere ............................................................................19
grow and payments volume increases, the processing fees
(2.9 percent plus 30 cents, and 3.4 percent plus 30 cents for Natasa Cvijanovic .................................................................................28
manually keyed items) mount. Plus, all of the profits go to Sascha Munger ......................................................................................30
the payfac, which provides little to no customer service in
return. Gary W. Glover .......................................................................................34
At the same time, a significant number of software compa-
nies are facing slower growth and looking for new revenue
Continued on page 26