Looking ahead to 2016, many ISOs will be faced with a variety of challenges to stay competitive within their markets. Today’s payment environment has evolved significantly, even from the past several years. With that being noted, what do ISOs and Independent Sales Agents need to do so they can differentiate themselves within the New Year?
Here are some helpful guidelines ISOs and Independent Sales Agents can follow to ensure a successful 2016:
Think Long Term, Not Short term
It is vital that ISOs and Independent Sales Agents stay prepared throughout 2016. Developing a long-term strategy will help guide ISOs and agents on future decisions and goals that will arise.
Likewise, ISOs and agents need to stay well informed on the latest payment offerings that are rising in popularity for 2016. ISOs and agents who sell older, traditional payment models will not survive long term up against competitors, hurting their chances of receiving profitable revenue. As a result, ISOs and agents need to re-evaluate how they plan to market themselves and their products.
“You either need to be an integrated payments company or you need to become a software provider,” spoke Rick Oglesby, senior analyst and consultant with Double Diamond Group in Centennial, Colorado. “Most ISOs can only be one or the other.”
Embrace Mobile Payment Solutions
Looking ahead, ISOs should look to incorporate a variety of payment solutions that will dominate during 2016 – including NFC technology and mobile payments. Developed from radio frequency identification (RFID) technology, NFC hardware is pre-integrated within countertop terminals merchants’ use for their business. NFC will be a valuable tool for both merchants and consumers, and has already been emerging at point of sale counters, ticketing booths, and vending machines to accept mobile payments. NFC technology is undeniably changing the way we pay for transactions, making it a high-demand solution ISOs should invest in for their products.
On a similar note, ISOs have the opportunity to accept alternative payment options from consumers, such as mobile wallets, leveraging the NFC technology. With the recent emergence of mobile wallets like Apple Pay, Android Pay, and Samsung Pay, many consumers are now utilizing their smartphones to make purchases. As a result, it would be wise for ISOs to join in on this progressing trend to gain profitable revenue. Mobile wallets are an alternative payment method that is greatly expanding and expected to continue to grow in usage throughout 2016.
Encourage Merchants To Adopt EMV
With the liability shift in the past, ISOs and agents need to continue urging merchants to adopt EMV technology. There are still a substantial low percentage of merchants who have adopted EMV capable solutions, and ISOs and agents need to step in.
In order to expedite the process of getting merchants incorporated with EMV technology, ISOs need to develop a strategic plan aimed at assisting merchants who have delayed integration. This plan will help safeguard ISOs and agents from liability of a fraudulent instance, and equally protect merchants from a possible fraudulent charge.
To further encourage merchants to integrate EMV, some ISOs are beginning to charge a fee to merchants lacking EMV solutions. In fact, several processors have begun working with ISOs to apply this fee to incompliant merchants.
Stay Up-To-Date on the Payments Industry
Throughout 2016, ISOs and agents need to make sure and stay attentive to recent industry news and regulations that are being enforced within the payment industry. As of late, regulators are looking to apply “Operation Choke Point”, a solution that is targeted from preventing fraudsters from having access to the bank accounts of consumers. However, this initiative holds ISOs and payment processors responsible for the misgivings that could be acted out by legal merchants.
On a similar note, The Financial Crimes Enforcement Network has recommended new regulations in regards to customer identification that could also be completed during 2016. These guidelines are significant, as they would increase the amount of people from which banks have to gather personal information. The responsibility of gathering the information will be mandated to ISOs and processors, possibly causing compliance issues for them.
For 2016, ISOs and agents have a lot to do to ensure a prosperous year. ISOs and agents can take advantage of the changing landscape of payments to guarantee their merchants have access to the latest solutions to grow their business. By developing a long-term plan, encouraging merchant adoption to EMV, and staying up-to-date on the latest industry regulations, ISOs and agents will have a better opportunity to stay successful in the long run for years to come.