Hybrid PayFac Benefits vs. Traditional PayFac
Benefits of Becoming a Hybrid PayFac
Becoming a Payfac is appealing to software providers as it allows them maintain control over their payments program as well as leverage frictionless boarding. What if you could take advantage of these things without the fraud liability and increased capital requirements that come with it?
As a quick refresh, PayFacs are aggregators that use their own merchant account to provide payment processing services to their clients, which effectively become sub-merchants.
In exchange for transaction revenue and significantly faster onboarding, PayFacs have to deal with increased PCI DSS compliance, fraud liability and staffing requirements.
For many software providers, the costs that are required to develop and maintain a PayFac program are too great, limiting the barrier to entry. What many software providers don’t know is that they may have another option: the Managed PayFac model.
What Is a Hybrid PayFac?
Also called PayFac light, hybrid aggregation or hybrid PayFac. the managed PayFac model means software provider’s get many of the same advantages as a full-fledged PayFac but without the cost and risk. The best payment partnerships are flexible, allowing companies to adapt to the real needs of their client base.
Take Advantage of Hybrid PayFac Benefits
Why is the hybrid model attractive to many software providers? Here are several benefits:
- Faster merchant boarding
- Significant residual income
- Reduced fraud liability
- Reduced investment of time and capital
- Lower staff and operational requirements
As a hybrid PayFac, your company can handle client onboarding in minutes or hours instead of the usual 48-72-hour time-frame required for merchant account setup. At the same time, Paragon Payment Solutions assumes the majority of risk and responsibilities related to operational expenses, chargebacks, underwriting and PCI DSS compliance. This allows you to provide clients with high-value platforms for payment processing, and reap increased financial rewards, while staying focused on your brand and customers.
How to Partner with Paragon Payment Solutions
Software providers often have the perfect conditions — a large client base and steady purchase volume — to generate increased residuals from hybrid PayFac transactions. At Paragon Payment Solutions, we make it easy for our partners to implement everything from tokenization for recurring subscriptions to mobile payment options with our comprehensive development API.
Watch out our video and learn all about the payment facilitator model – an overview of how it works, the facts to know if it’s right for you and most importantly how to take advantage of the benefits without the burdens.
Ready to see our API or open a test account? Looking for more information on our Partner Programs? Are you a merchant with a question? We are here to help!