ThePaypers: Interview with Head of Product Management and Chief Architect Falk Brügmann about new merchant onboarding requirements

By Falk Brügmann on 27. May 2013 in Market Insights, Open Payment Technology

This week I gave an interview in the ThePaypersregarding new market-driven merchant onboarding requirements and how PAY.ON is solving these through its platforms PaySourcing and PayPipe. The conditions have changed: The new generation of merchants wants a direct and streamlined access to the payment network including free individualization of the payment process. Additionally, the mPOS market speed-up the development of infrastructure providers as PAY.ON to access a multitude of merchants within a very short time. This process has got great impact to the whole market and will sustainably affect the future of the payment industry.


Following you find the summery of my interview statements. I am looking forward to receiving your feedback – so please comment or send an e-mail directly to!

ThePaypers:  Has competition for the merchant become fiercer over the last years and what are the new merchants demands?

Falk: At any point in time, there are always players who keep raising the bar. As a result, market expectations change. Product features and services that were nice differentiators a couple of years ago are now part of the basic expected feature set.


The mobile POS segment is one of the primary drivers of current trends. Other important drivers are demands by providers targeting small merchants from the e-commerce long tail. These merchants are no longer happy to receive a basic feature set through a hard-to-integrate programming interface with a PDF integration document more than 100 pages in length and an onboarding process that takes several weeks.


Instead, such merchants are looking for a smooth, streamlined, easy and fast integration experience. After applying for an account with a PSP, they expect to be able to process immediately or after a few hours. For the integration of the payment solution, they expect to be able to copy a couple of lines of code, make some very simple URL requests, and that’s that. The same applies to documentation: merchants are asking for short interactive online tutorials with ready-to-use code samples.



ThePaypers: What are the advantages of this new generation of payment methods and integration options?

Falk: Earlier payment integration options for merchants offered a choice between flexibility and ease of use. Hosted payment page solutions are easy to integrate and make it easy for the merchant to be PCI compliant, but give the merchant only a certain level of control over look, feel and features. For some merchants, these solutions fit the bill perfectly – but others require greater flexibility especially in matters of corporate design.


Classical, typically XML-based payment programming interfaces, on the other hand, provide the merchant with full control over the payment page and workflow, but require more development effort on the merchant’s part. Furthermore, the merchant has to be fully PCI-certified when directly handling credit card data. Such interfaces are perfect for some purposes – for others, they require too much effort on the merchant’s side.


New-generation payment integration solutions like PAY.ON’s COPYandPAY (other interview in ThePaypers do not force merchants to make a trade-off between flexibility and ease of integration. Instead, they offer the best of both worlds. They are the easiest to integrate by far, but still give the merchant full control over the layout of their page, the workflow and the payment options and schemes offered. At the same time, they significantly simplify the issue of PCI compliance for merchants.


All in all, by extending its proven and full-featured PaySourcing platform with a very strong integration solution in line with new-generation technology, PAY.ON has helped to strengthen the range of products offered on the market by its clients (e.g. payment service providers and independent sales organizations) in the mPOS and small and medium-sized merchant segment.



ThePaypers: How can payment service providers speed up their merchant onboarding processes?

Falk: The main prerequisite is a seamless automation and integration of the corresponding back-office processes which include a merchant risk assessment solution such as G2, Web Shield or WorldCheck – and, of course, are fully integrated with the acquirer system.


PAY.ON offers an optimised merchant onboarding tool that covers KYC document upload and management and integration with multiple acquirers; it can also connect to a choice of different merchant risk assessment solutions, includes real-time validation and plausibility checks and, of course, automatically sets up the on-boarded merchants in PAY.ON’s PSP/ISO platform-as-a-service PaySourcing. Both the administration user interface of the tool and the workflow are customisable to fit the process requirements of the PSP, and the tool has an online programming interface that can, for instance, be used to connect existing merchant-facing registration front ends with the tool.


For payment service providers/independent sales organizations who already have merchant onboarding solutions in place or want to roll their own, our PaySourcing platform sports an online interface that allows users to programmatically create and manage the merchant data in the PaySourcing platform from the outside. This way, the PSP/ISO can tap into the feature power of PaySourcing and its hundreds of connections to payment providers and schemes, while concentrating their efforts on sharpening the selling proposition where it counts – at the front end towards the merchants.


Examples of companies that have successfully taken this path are Paymill, Stripe and iyzi payments. iyzi payments, for instance is targeting the Turkish market, using PAY.ON’s COPYandPAY as their primary payment interface.



ThePaypers: Why is fast merchant onboarding crucial to the success of a payment services provider?

Falk: First of all, when you get merchants up and running more quickly than your competitor, you have a significant competitive sales advantage. When your merchants start to process earlier, you start to earn money earlier, thus improving your cash flow.


Then, of course, automation saves expenses, both directly in reduced manual effort, and indirectly through better data and application quality and reduced reworking. Merchant risk checks reduce the risk of merchant fraud. This improved application quality and lower risk are important assets in your position towards the acquirers.


If you want to capture the long tail of the market consisting of small and medium-sized merchants, an efficient onboarding process is a must-have today.


PAY.ON is one of the few players and the only one in Europe who is able to offer such a strong and flexible solution.



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