In this article, we will look at what pain unites e-money issuers, and what are the options for its "treatment"
An electronic money issuer (EED) is an organization that is authorized to issue electronic money (digital version of good old cash). There are 479 such organizations registered in Europe alone, more than half of which are located in the UK.
The list of their services is quite diverse, from personal banking and issuing elite credit cards to organizing international money transfers. Moreover, EEDs often provide services to different groups of the population.
And yet, they all share a common pain.
And it's not about the consequences of Brexit at all.
It's about the cost of developing and maintaining a payment gateway.
Remember this figure in case you decide to build a system from scratch. It will help you navigate the market and assess how ready your company is for such a step.
Why so expensive?
Now we will explain everything step by step.
To get started, you will need to hire a team of experienced professionals with experience in the payments industry. We recommend starting with three developers, a QA specialist and also an information security specialist. On average, the salary expectations of specialists of this level are about $ 3.5 thousand per month for one person, which in total for the entire team will be $ 17.5 thousand.
You may also like: How to save 50% on payment processing with a white-label system.
Based on our own experience, as well as the experience of our partners in the online payment industry, the development of the system will take from six months to two years. It takes six months to create the most basic functionality. But keep in mind that with the ever-growing expectations of potential customers, basic functionality will not be enough for you. The requirements of your target audience are now higher than ever! Therefore, keep your pockets wider - and be prepared for the most expensive end.
With such calculations, you will need $ 420 thousand to create a system.
Unfortunately, the costs don't end there. From the moment the platform is launched, your team switches from development to maintaining the system. In addition, at this stage, you will need to hire two or three payment specialists, depending on your transaction volumes, to monitor and manage cash flow. This addition to the team will also cost you about $ 10.5 thousand per month.
We will not exaggerate if we say that only a few e-money issuers can afford this luxury right from the start. So what options are there for those who can't afford their own payment gateway?
Moreover, such systems are often equipped with a number of innovative features that can take your EDI to a whole new level.
1. Smart routing
Smart routing, at its core, is an attempt to increase the number of confirmed transactions by changing their standard “route”. This feature allows you to route each payment to a pre-selected channel with the highest likelihood of passing. Smart routing is a real lifesaver for high-risk business owners. And at the same time, it is great for those whose line of business is not considered to be risky.
With this feature, you provide customers with the opportunity to enjoy a seamless payment process, thereby enhancing their own brand image in their eyes and fostering their loyalty.
2. Smart invoicing
Without exaggeration, this is one of the most desirable features in a payment system. Smart invoicing allows you to dynamically determine which customer actions to charge a commission. To set it up, you need to predefine payment actions and triggers for each individual customer. As a result, you can earn more with a flexible commission structure.
Other advantages of this functionality include: reducing the time and resources of the company through the automation of processes, simplifying the management of invoices and reducing the cost of processing for the client due to customization of commissions.
Unfortunately, this functionality is rather complicated in its implementation, and it is offered only by a few payment software providers. The good news is that Akurateco is one of the few innovative providers to offer Smart Invoicing to their customers.
You may also like: Smart Invoicing: Behind the Scenes of Automated Invoicing
3. Tokenization
Tokenization remains a rather underestimated feature, although it has the potential to be a decisive factor in building customer loyalty to your brand through the introduction of one-click payment. And given that tokenization always comes with a range of security measures, it can be a real boon for your company.
4. Cascading
While smart routing prevents declined transactions by directing them to the channels that are most likely to miss them, cascading offers a solution to the problem of already existing declined payments.
The system allows the merchant to track and clearly understand the reason for each individual failure, as well as analyze them and make the right business decisions in order to avoid a repetition of the situation.
5. Fraud prevention module
Online scams are a constant headache. It is real and merciless.
About 82% of organizations experienced some form of online fraud in 2018, according to the Association of Financial Professionals.
It can become the main threat to your EDI business if you choose the wrong payment gateway. When choosing, pay attention to whether the system meets the highest safety standards. So, for example, Akurateco fully complies with PCI DSS standards, thus providing its customers with the opportunity to prevent fraud by entrusting an experienced provider with the technical side of the issue.
Sounds too good to be true? But such a decision is real. If you are looking for a reliable white-label software provider, Akurateco is the perfect solution. You can book a free demo of our system to see our system from the inside by filling out this form. See you!
An electronic money issuer (EED) is an organization that is authorized to issue electronic money (digital version of good old cash). There are 479 such organizations registered in Europe alone, more than half of which are located in the UK.
The list of their services is quite diverse, from personal banking and issuing elite credit cards to organizing international money transfers. Moreover, EEDs often provide services to different groups of the population.
And yet, they all share a common pain.
And it's not about the consequences of Brexit at all.
It's about the cost of developing and maintaining a payment gateway.
What is a payment gateway?
A payment gateway is software used by payment providers to organize payment processing. It is a solution that allows a merchant to receive payment for their services through a website, mobile application, etc. In other words, this is a system that transfers funds to the merchant's account from the client's card after he clicks “Pay”.Payment gateway cost for EDI
Believe it or not, a transaction that often takes only fractions of a second is technology that costs hundreds of thousands of dollars to build and maintain. According to our calculations, on average, the creation of a payment system costs the company $ 420 thousand.Remember this figure in case you decide to build a system from scratch. It will help you navigate the market and assess how ready your company is for such a step.
Why so expensive?
Now we will explain everything step by step.
To get started, you will need to hire a team of experienced professionals with experience in the payments industry. We recommend starting with three developers, a QA specialist and also an information security specialist. On average, the salary expectations of specialists of this level are about $ 3.5 thousand per month for one person, which in total for the entire team will be $ 17.5 thousand.
You may also like: How to save 50% on payment processing with a white-label system.
Based on our own experience, as well as the experience of our partners in the online payment industry, the development of the system will take from six months to two years. It takes six months to create the most basic functionality. But keep in mind that with the ever-growing expectations of potential customers, basic functionality will not be enough for you. The requirements of your target audience are now higher than ever! Therefore, keep your pockets wider - and be prepared for the most expensive end.
With such calculations, you will need $ 420 thousand to create a system.
Unfortunately, the costs don't end there. From the moment the platform is launched, your team switches from development to maintaining the system. In addition, at this stage, you will need to hire two or three payment specialists, depending on your transaction volumes, to monitor and manage cash flow. This addition to the team will also cost you about $ 10.5 thousand per month.
We will not exaggerate if we say that only a few e-money issuers can afford this luxury right from the start. So what options are there for those who can't afford their own payment gateway?
White-label payment gateway
Surprisingly, but true: only a few EDI are aware of the amazing possibilities of a white-label payment gateway, which allows you to legally sell a ready-made payment solution fully branded for your company. As a result, you get a system packed with the latest technology without having to invest in the development and support of the platform itself.Moreover, such systems are often equipped with a number of innovative features that can take your EDI to a whole new level.
Key functionality of a white-label payment gateway
1. Smart routing
Smart routing, at its core, is an attempt to increase the number of confirmed transactions by changing their standard “route”. This feature allows you to route each payment to a pre-selected channel with the highest likelihood of passing. Smart routing is a real lifesaver for high-risk business owners. And at the same time, it is great for those whose line of business is not considered to be risky.
With this feature, you provide customers with the opportunity to enjoy a seamless payment process, thereby enhancing their own brand image in their eyes and fostering their loyalty.
2. Smart invoicing
Without exaggeration, this is one of the most desirable features in a payment system. Smart invoicing allows you to dynamically determine which customer actions to charge a commission. To set it up, you need to predefine payment actions and triggers for each individual customer. As a result, you can earn more with a flexible commission structure.
Other advantages of this functionality include: reducing the time and resources of the company through the automation of processes, simplifying the management of invoices and reducing the cost of processing for the client due to customization of commissions.
Unfortunately, this functionality is rather complicated in its implementation, and it is offered only by a few payment software providers. The good news is that Akurateco is one of the few innovative providers to offer Smart Invoicing to their customers.
You may also like: Smart Invoicing: Behind the Scenes of Automated Invoicing
3. Tokenization
Tokenization remains a rather underestimated feature, although it has the potential to be a decisive factor in building customer loyalty to your brand through the introduction of one-click payment. And given that tokenization always comes with a range of security measures, it can be a real boon for your company.
4. Cascading
While smart routing prevents declined transactions by directing them to the channels that are most likely to miss them, cascading offers a solution to the problem of already existing declined payments.
The system allows the merchant to track and clearly understand the reason for each individual failure, as well as analyze them and make the right business decisions in order to avoid a repetition of the situation.
5. Fraud prevention module
Online scams are a constant headache. It is real and merciless.
About 82% of organizations experienced some form of online fraud in 2018, according to the Association of Financial Professionals.
It can become the main threat to your EDI business if you choose the wrong payment gateway. When choosing, pay attention to whether the system meets the highest safety standards. So, for example, Akurateco fully complies with PCI DSS standards, thus providing its customers with the opportunity to prevent fraud by entrusting an experienced provider with the technical side of the issue.
Conclusions
A white-label payment gateway can be a solution to the pain often experienced by EED. You don't have to invest hundreds of thousands of dollars to get a quality payment solution. Choosing a white-label system, you do not need to spend money on the development and maintenance of complex infrastructure. Plus, you can save up to 50% on processing costs.Sounds too good to be true? But such a decision is real. If you are looking for a reliable white-label software provider, Akurateco is the perfect solution. You can book a free demo of our system to see our system from the inside by filling out this form. See you!
