• Deepak Colluru, Director of Product Managemen at GoCardless


• 03.11.2023 01:30 pm
#payments #security

Last month, GoCardless launched the results of our latest global survey, revealing that over a third of businesses plan to consolidate the number of Payment Service Providers (PSPs) they use within the next 12 months. It’s clear from the responses that the current economy plays a key role in this decision, with 9 in 10 respondents telling us that they’re satisfied with their current suppliers but the need to reduce costs takes precedence.

The good news is that businesses aren’t leaving PSPs in the dark about how to gain a competitive edge and retain them as customers. Their call to providers is to offer a wider variety of payment methods, tools that can help boost successful payment rates and anti-fraud solutions. Businesses even shared that they’re willing to pay additional fees for these. At first glance that might sound strange given the need to cut costs. However, when you learn that over half of the surveyed businesses are using at least 3 PSPs to get the services they need, you can see how, objectively speaking, paying top-up fees for the services they actually need day-to-day is more cost-effective than onboarding and managing multiple suppliers.

These asks from businesses aren’t unreasonable. They aren’t demanding something trendy or complex, they simply want the ability to better cater to their existing audiences and to protect themselves from fraudulent or risky payers. The more daunting aspect is the timeframe in which businesses are looking to “judge” and consolidate their suppliers. Assuming that you’re a PSP who wants to rise to the challenge and enhance your existing offering, you might be faced with the classic dilemma of ‘buy versus build’. Should you pay to outsource a pre-built API when you have the technical skills and know-how in-house? If staying competitive and being first to market is a priority, then you may find that the best - and quickest - way to satisfy customer demand is to ‘buy’ through a third-party expert.

Yes, there is a cost to this. But that’s also true of building in-house. On average, it takes PSPs six to nine months to build and implement a new payment method. It requires people to dedicate their time and factor in risk and compliance, mandate management, data security, in-house training…the list goes on. Even in the most agile of organisations, this is a resource-heavy process. So, why not let third-party providers do the hard work and provide you with a single API that you can integrate, leaving you to spend your time on promoting and upselling rather than building to multiple very different A2A payment methods?

If you’re still unsure or want to find out more about what businesses are planning in the next 12 months, the full survey findings are published in our report ‘Embedding a Competitive Edge.’