Payment Processing For ISVs (Independent Software Vendors)

The independent software vendor (ISV) market is getting a bit crowded. 

According to expert projections, the number of unique ISVs worldwide is expected to hit one million by 2027—up from just 175,000 in 2018.  

Global payment processing has become crucial to ISVs and their operations. You must be able to support organizations in different geographic regions, and you need to stand out from your competitors. 

Need some help getting a competitive edge for your ISV operation? Are you looking for a simple way to accommodate the needs of your clients? 

You’ve come to the right place. This guide will explain your options and tell you what to look for as you’re evaluating different payment processing solutions.

Global Payment Processing For ISVs

International payment processing can drastically enhance a software’s potential user base. If you can serve clients overseas the same way you onboard and serve ones locally, you can expand your reach and gain a higher market share in your niche. 

This gives you a tremendous advantage over the competition, as not every ISV can accommodate global payment processing. 

Modern payment systems have become the anchor that flows into other aspects of a business. Solutions can be used to track units sold, integrate with marketing tools, and even flow into a holistic ERP system.

The best and biggest ISVs are offering software that provides clients with a complete overview of business performance. 

Any ISV that can offer clients global payment capabilities will stand out amongst other players in this space—especially if the software offers a holistic business solution. It not only separates your software from the crowd but it adds a ton of value to your customer base.

Historically, ISVs have viewed global expansion as a complex risk due to the high costs. Dealing with complicated APIs, international regulations, global onboarding, and compliance across international lines can be overwhelming. Many ISVs would also need to form relationships with new partners to achieve global scale.

Some of you might have priced around some local processing networks in different regions. But these smaller partners typically offer limited gateways and don’t always come with crucial features, such as fraud scoring. They also impose sky-high cross-border fees. 

Is Adding a New Partner Worth It?

Continuing with the point above, adding new partners in different regions for global expansion can be costly for ISVs. Each additional payment partner will have unique costs, fees, requirements, and integrations in your software stack.

These added integrations used to manage payments will ultimately lead to higher technical debt. Not to mention the costs associated with maintenance, updates, and more—all of this for each new country or region you’re expanding to.

When you factor in those costs with the challenges and fees from client onboarding, local compliance, taxation, and everything else, adding new partners probably isn’t worth it.

Rather than looking for multiple new partners, you can look for a single global payment solution that’s designed for ISVs. This will simplify everything for you.

What to Look For in a Global Payment Processing Solution For ISVs

ISVs that want an edge need a single global payment solution. This will solve the challenges associated with adding multiple partners while still giving you the opportunity to scale internationally.

Below are the top factors that ISVs should look for when seeking a global payment solution:

A Single Integration

First and foremost, you need to find a payment processing solution that offers a single integration for global payments. Not only does this simplify everything for you, but it drastically reduces your costs.

A single integration lowers your technical debt, simplifies maintenance, and lowers the complexity associated with your overall system. 

Money saved here gives you an opportunity to offer lower prices to your clients while also increasing your profit margin.

Simple Onboarding For International Clients

Successful international payment processing for ISVs must be consolidated to a centralized platform. This will allow you to onboard clients with ease, regardless of their geographic location.

In a perfect world, your payment processing provider can even help with the onboarding process or manage it completely for your ISV operation.

Built-in Compliance

Compliance is always a top concern in the payment processing space. You need to protect yourself and your clients alike. But this is a challenge as you cross international borders, as regulations vary from country to country.

For example, working with businesses that need payment solutions in the EU would force you to comply with the GDPR. This might not be a concern for you if you’re only used to dealing with clients in the US.

The best global processors for ISVs have experience with global payments and remove barriers associated with achieving payment compliance. 

Payment Processing Expertise

Smaller and regional partners just don’t have the same experience as an international provider. You can’t call them and ask for assistance or clarification with anything outside of their region—they just won’t know the answer. 

But a global provider should be equipped to handle the challenges associated with adding customers in new regions. The best providers offer strategic advice during these transitions and expansion periods.

Support

This piggybacks off of the last point. ISVs should have a keen eye for solutions that offer support on multiple levels for global payments.

I’m referring to things like go-to-market support, analytics and reporting, tech support, and more. 

If you have a question, you want the ability to speak with a real person quickly and get answers fast. 

Client Value

The best solutions for ISVs also provide immediate value to your clients. 

Your provider should offer simplified cross-border payments, global compliance, fraud protection, and other merchant tools. This gives your clients the ability to sell anywhere at the lowest possible cost.

Final Thoughts

Global expansion for ISVs isn’t just a dream. It’s something you can achieve without having to deal with astronomical costs and headaches.

But success in this space is contingent on finding a single payment processing solution that can accommodate the needs of you and your prospective clients alike. 

Keep the tips in this guide in mind as you’re shopping around and comparing solutions.