Full-Service Payment Processing vs. Payment Gateway Only Providers

If you’re like most software providers, happy, satisfied customers are essential assets.  As a result, giving your customers the ability to process credit card payments through your software is crucial to maintaining and growing your business.  With a wide range of options available, it can be challenging to decide which type of payment integration is better —a payment gateway provider or a full-service payment provider.

What is a Full-Service Payment Provider?

A full-service payment provider acts as both a payment processor and a gateway.  This gives customers a choice when it comes to who provides their merchant services.  When software providers work with a full-service payment provider they are working with a partner that owns their technology.  Many third-party payment gateways are often used by merchant services providers that do not own their own technology.

Another advantage of using a full-service provider is merchants can take advantage of value added services such as tokenization, card account updater and point-to-point encryption.  Rather than just simply serving as a toll booth to route the transaction to an endpoint, a full-service payment provider does it all.

When software providers choose to partner with a full-service payment provider, both the software provider and their merchants benefit as the payments chain is drastically simplified and cost is reduced.

 What is a Payment Gateway?

A payment gateway only provider is an interface that simply routes payment transactions to an endpoint. A payment gateway interface adds payment functionality to software applications and e-commerce websites. Since the gateway acts as a transaction router only there are additional fees that merchants must pay in addition to their traditional merchant services fees.  When issues arise merchants may experience service frustrations as with a payment gateway only provider there are additional players in the game.

We recommend asking yourself three questions before deciding if a gateway-only option fits your needs:

1. Does it improve the user experience?
2. Will your customers incur increased costs?
3. Will it help me grow my business?

If any of these answers are “no,” it may be time to consider a full-service payment provider.

Integration Perfected

Paragon Payment Solutions offers solutions that are designed especially for software providers and their customers. Focusing on integrated payments and strategic partnerships, we provide cost-effective custom-built programs to meet your needs. Contact us to learn more.