HOW DOES MANAGED PAYFAC COMPARE TO PAYFAC?

The payfac model has reshaped the payments ecosystem for field services software providers. With auto-approvals and instant onboarding of merchants, being a payfac puts control squarely in the hands of the software provider and makes the customer experience more seamless. But it’s not for everyone as program limitations exist and the costs are high, making the path to ROI long. Here are the key differences between the two programs.

. No card brand registration or associated fees.

. Required to pay registration and annual renewal fees of $5,000 each to Visa and MasterCard.

. 0% risk and liability for merchant portfolio. . 100% risk and liability for merchant portfolio.

. Simple API allowing you to provide your customers with a branded, instant onboarding experience as well as white-labeled statements.

. Full operational support from the payments partner provided to manage payments including risk and underwriting.

. Revenue share resembles that of a referral partnership, but with instant onboarding and auto approvals, Integrated Software Vendors (“ISVs”) begin earning residuals immediately.

. A team of payment experts to support and guide your organization through the entire development process.

. A dedicated partner management team who oversees all strategic and operational aspects of the partnership.

. Direct access to marketing services with both turn-key and custom campaigns to drive customer adoption.

. More complex API since in addition to instant onboarding and white-labeled statements, payfacs own settlement and funding disbursement.

. Copious staff resources are needed to provide customer support, risk, underwriting, IT, etc.

. Possible higher revenue share since most of the operational and structural responsibility lies with the payfac.

. Minimal development support provided.

. Limited guidance and collaboration.

. Marketing resources are not available.