Payments-as-a-Service Solutions Boost Global Omnichannel Commerce

Payments are part of the shopping experience for today’s consumers. A retailer’s point of sale payment options can make it or break it for a customer, whether they’re making a purchase in-store, online, or on a mobile device. And since e- commerce is becoming increasingly global—calling for a quicker, easier, and more affordable movement of money between parties—merchants are under additional pressures to expand their payments capabilities.

Outsourcing Payments System to the Cloud

Enter innovative cloud-based solutions in the form of Payments-as-a-Service (PaaS). These offerings, referred to as the “high-tech Swiss Army knives of payments services” by PYMNTS.com in Payments As A Service: A Consumer-Driven Challenge?, are being embraced around the world to meet the needs of merchants, banks, consumers, and other stakeholders in the payments process.

Using a Software-as-a-Service (SaaS)-based methodology to connect disparate payment systems as well as other components including loyalty and reward programs and mobile wallets, PaaS solutions make it easier for companies to adopt new technologies and offer in-demand payment methods to their customers.

And importantly, owing to the flexibility and affordability inherent in the SaaS model, PaaS solutions enable businesses to easily scale their operations while remaining EMV and PCI compliant and competitively cutting-edge—without overhauling their technology infrastructures. Read A Quick Untangling of the “-as-a-Service” Payments Universe for more about the benefits of leveraging cloud-based technology.

Meeting Global Payments Challenges

Aside from being manual, the more traditional payments methods (e.g. ACH, direct debit, and SWIFT) require buying a terminal or other hardware, purchasing software services, and partnering with a vendor for maintenance. And they’re certainly not “built” for modern-day cross-border transactions, often carrying cost and time constraints that limit merchants’ ability to compete profitably in a global market.

It’s easy to see why this evolution is boosting the popularity of alternative payment systems—like those offered by PaaS solutions—that are especially conducive to transacting on a global scale. Consider marketplace leaders like

2Checkout, whose hosted or API-based solution enables merchants in 211 markets around the globe to accept a range of major payment methods including credit cards, debit cards, and PayPal; or Stripe, who offers a suite of APIs allowing businesses to operate online payment systems. PaaS solutions like these align the payment processor and merchant in a single interface and invisibly handle the complexity of moving funds between providers—no matter where they are in the world. And on the back end, parties get rich transactional data that can be used to inform business decisions.

Digital technologies are changing the way business is done and shifting consumers’ point-of-sale expectations, which today include using foreign currencies, paying on smartphones, and applying rewards program coupons to purchases. PaaS offerings are making it possible for merchants to meet these customer needs and will continue to be an important area of focus for technology innovators and retailers alike. Stay tuned for more insights into PaaS offerings and how they’re expected to impact the B2B payments space.