At one time, merchants saw payments simply as the cost of doing business. Today, however, payments are seen as a strategic battleground—one that can drive revenue and loyalty when done right. Against this backdrop, and coupled with the rise in digital payments, acquirers and banks must work harder than ever to provide the payment types, speed to market, cost point and reliability merchants are demanding.
A recent study by ACI and Edgar, Dunn & Company revealed that more than half of merchants already have a multi-acquiring strategy in place, while 70 percent of PSPs plan to extend their acquiring relationships in the next 12 months. Clearly, the numbers show that the multi-acquirer setup is not only important, but also set to continue and thrive.
There are several reasons for this. First and foremost, balanced management of risk is a top priority for all members of the payments ecosystem—and different acquirers have different appetites for risk. Each offers its own unique experience and services to combat fraud and risk, allowing merchants to attain a balance while maximizing conversions.
This is complemented by local expertise, whereby a particular acquirer will necessarily have a greater understanding of the local consumer or merchant base, as well as the rules and regulations of a region. Local acquirers will tend to give a greater uplift to conversions for that area, and with multiple acquirers, merchants can ensure they’re delivering an optimal experience to a wide array of customers. This can also enable cross-border expansion, helping to quickly break down barriers into new markets.
Another clear conversion driver is the ability to offer the payment methods and channels consumers prefer. Simply put, the more acquirers a merchant or PSP works with, the more payment options they can offer to consumers. There really is no substitute for being able to accept a consumer’s preferred payment type, which is a major building block in building and maintaining loyalty.
The benefits of multi-acquiring are clear, and merchants and PSPs are increasingly relying on this strategy to ensure flexibility, drive conversions and control costs. Acquirers must be aware of this new landscape and adapt—or else risk losing customers to competitors.
For more information on how acquirers can drive the modernization that creates a true competitive differentiator, I encourage you to download our latest whitepaper, Meeting Disruption with Modernization: How Today’s Acquirers Can Win Tomorrow.