Innovations in digital payments technology benefit merchants and consumers. Shoppers use mobile wallets to make fast, convenient payments while business owners streamline their accounting needs through digital transactions. With all these advancements, POS transactions via cash dropped to 12% in 2020.
Several tech and banking institutions contributed to the modernization of digital payments. However, the most crucial leaders behind payment processing innovations include Visa Inc., Mastercard Incorporated, and JP Morgan Chase & Co. Of course, third-party processors like Stripe, PayPal, ACI Worldwide Inc, and Fiserv are pretty prominent as well.
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Financial institutions like card networks, banks, and global fintech companies dominate the digital payments industry. In most cases, these companies run in-house front- and back-end payment processing.
Third-party processors rely on another commercial institution for front- and back-end processing. They often have less stringent guidelines. Some processors even work with businesses from high-risk industries.
Carefully assess your business when deciding between commercial banking institutions and third-party payment processors. Remember: one-size-fits-all processing systems do not exist. Only submit your application after weighing the pros and cons of your prospective digital payment processor and meeting their requirements.
However, don’t obsess over just one or two companies. There are dozens of processors on the market, so you can reapply as many times as you want. Find the ideal provider based on your individual processing needs.
Do you find yourself stuck between payment processors? Processing Card has you covered! Use our in-depth comparison review of the best digital payment processing systems as a starting point.
Florence Carpenter is passionate about ensuring that the process of opening merchant accounts is as straightforward as possible. She graduated from the University of Michigan with a bachelor’s degree in Marketing.
