Digital Transactions Authoritative, insightful and timely information for payments professionals
Independent sales organizations and acquirers looking for a payment gateway have another resource to use. Payments consultancy The Strawhecker Group recently released its Payment Gateway Directory, which catalogs 58 data points about 73 companies.
The report also analyzed the performance of the gateways by assessing the account-boarding process, evaluating developer tools and application programming interface technology, sending real-time transactions through the gateway, and by completing the process of opening a merchant account.
Among the slate of top-performing gateways are CyberSource, BluePay, Shopify, Worldpay, Authorize.Net, and Stripe.
Payment gateways are viewed by many as essential to providing integrated payments, which connects point-of-sale software used on computers to the payments system, says Jared Drieling, Strawhecker senior director of business intelligence, says in an email to Digital Transactions News.
“Gateways, as the name implies, connects merchants and payments through a platform,” Drieling says. “However, gateways are becoming more sophisticated and [are] now thought of as an integrated payments platform that can connect shopping carts, point-of-sale, etc.” The effort is to aid merchants in providing a shopping experience that works for customers across multiple channels.
Many merchants, especially those in retail, view omnichannel commerce as vital to competing against the likes of Amazon.com Inc., and also to keeping up with how consumer-shopping habits are affected by mobile devices.
This connectivity is key to the developing omnichannel payments environment, Drieling says, “and hence why there is an aggressive play by acquirers and ISOs to have a robust gateway platform.”
One recent instance of that is Network Merchants LLC’s acquisition of Creditcall, a United Kingdom-based payment-gateway provider, processor, and vendor of EMV kernel software. In another, JPMorgan Chase & Co. bought WePay Inc., a payment facilitator and API developer. Last year, First Data Corp. purchased BluePay for $760 million.
“Although there is still a mix of independent gateways and gateways developed or owned by acquirers and other entities, the trend is clearly towards integration (and they are a hot M&A target),” Drieling says.
ISOs and acquirers considering a gateway not only must consider the performance of the prospective vendor, but also other factors, he says. Some gateways may be better suited to different merchant categories, like government services. Other factors are the typical merchant size for the gateway, how well the gateway can integrate with other value-added services, and how easily a merchant can be boarded. Geographic coverage may be important, too, especially if the payment provider’s merchants are either selling internationally or plan to.
