What’s the Next Big Thing for Payment Service Providers?
These new trends, technologies and innovations are stirring things up in the payments space:
- B2C and corporate payments
- Blockchain solutions
- Immediate payments
- In-app payments (e.g., Uber)
- Mobile wallet, NFC and other technologies
- Non-banking players entering market
- Security and authentication enhancement
- Social and mobile commerce
- Virtual currencies
- Virtual reality shopping experiences with integrated payments
However, the expense, IT resources, and time required for Payment Service Providers (PSPs) – i.e., issuers, acquirers, payment processor, payment gateways, eCommerce platforms, etc. – to capitalize on these various trends differs greatly. Similarly, the risks and rewards vary widely. Sorting through the possibilities and permutations can be daunting.
But there is one trend that PSPs can capitalize on that involves no capital investment, little risk, and proven ROI: the accelerating growth of CNP fraud. Wait, what? Isn’t fraud supposed to be bad?
The short answer is yes. Some facts (pay special attention to the last two):
- CNP fraud accounted for $4 billion in losses 2016
- CNP fraud losses are projected to soar 80% by 2020
- Mobile commerce — the fastest growing CNP channel – is 2X more likely to involve fraud, according to The Fraud Practice
- About half of eCommerce and mCommerce merchants say controlling fraud costs too much
- One in three declined transactions turns out to be a false positive (large eCommerce/mCommerce merchants)
To summarize, here’s why these trends represent an opportunity for PSPs:
- CNP fraud costs your eCommerce merchants dearly and it’s only getting worse
- Your merchants want to spend less money fighting fraud
- They’re losing too much revenue due to ineffective fraud screening
What’s the solution? Offer your merchants payment processing that includes enterprise-class fraud prevention integrated as a baseline service. It’s a smart response to the trends in CNP transactions, right? But can you do it in a way that involves no capital investment, little risk, and proven ROI?
The short answer is Kount Central. Again, some facts:
- No capital investment. Kount Central is delivered via Software as a Solution (SaaS). There’s no technology equipment to buy. No IT infrastructure to deploy. A typical integration for Kount Central takes less than 60 days for the vast majority of PSPs.
- Little risk. Leading payment processors – including BlueSnap, Braintree, Chase Paymentech, GoECart, Magento, and X-Cart have deployed Kount Central. If they can profitably offer portfolio-wide fraud prevention to their merchants, so can you.
- Proven ROI. Chase Paymentech merchants saw their chargebacks drop 30% to 50%. Other merchants saw increases in their top-line revenues. And one top Internet retailer handling more than 25,000 orders per day was able to consolidate its fraud review program to a single full-time employee.
“Our business has doubled while the chargeback rate for our merchants has declined 500%,” says John Johansen, Fraud Manager at BlueSnap.
There are a lot of other reasons why Kount Central is an innovative response to market trends that makes sense for PSPs:
Competitive differentiation. Services and pricing are becoming commoditized. Helping your merchants easily address the accelerating threat of CNP/mobile fraud is a game changer.
Fight margin compression. Instead of cutting fees to win or retain accounts, offer greater value.
Frictionless onboarding. Quickly approving merchants helps you win new business. Doing it safely with Kount Central protects your profits.
Regulatory compliance. Monitoring merchant activity is essential to avoiding legal issues (AML, OFAC, KYC, etc.). Kount Central makes it easy and cost-effective.
Find out how you can transform a source of constant friction between you and your merchants – chargebacks, product losses, fraud costs, fees, etc. – into a business-building opportunity. Download the eBook “Protect Your Merchants. Protect Your Profits” and discover how you can easily and cost-effectively capitalize on one of the key trends affecting the payments industry.