November, 2021 - PAYARC

Mobile App Payments Commentary: MobilePaymentsToday.com
Jared Ronski, Principal at PayArc, was recently featured in MobilePaymentsToday.com. He offered commentary on the $101 Billion Mobile App Opportunity for merchants, noting the importance of understanding different, nuanced monetization models in mobile apps. He also offered best practices for business owners and developers looking to take advantage of this sector, point to the following key considerations:
- Payment experience should not be an afterthought
- Security
- Customer service
- Fraud prevention
You can read the full article here. Please comment to let us know your thoughts.
Payarc

November 15, 2021

Security, Technology

mobile-apps-payments
Mobile Ecommerce Trends 2018: The Customer Rules
Mobile app developers know they’re onto a good thing — especially those planning to monetize app ideas. Consumers love apps, including apps used to shop for all sorts of treasures.

Retail experts at Forrester predict mobile payment transactions to account for $282.9 billion (in the U.S. alone) by 2021. Indeed, they predict a compound annual growth rate (CAGR) of 20.3% until then.

Forrester also highlights benefits of customer loyalty and engagement ROI that accrue to retailers either setting or following mobile commerce trends.

Clearly, you’ve joined the m-commerce movement at a great time.

And like any good retailer, it pays to keep up with the trends influencing both consumers and competitors. One thing’s for sure in 2018: The Customer Rules.

But what mobile commerce trends might affect your success this year? Let’s take a look.

Smartphones & Tablet Users Hail Apps 5 Hours Per Day

Does anyone even remember the days before smartphones and tablets? No quick peaks at Facebook or Twitter between meetings. No email shadowing you everywhere, twenty-four/seven.

We’re talking only fifteen years ago. Yet it seems akin to “way, way back in time” when we made do with old-style mobile phones.

According to an MIT Technology Review article by Michael DeGusta, “The era of the smart phone in America really began in 2002, when existing PDAs took on the ability to make phone calls.” About five years later, Apple launched the iPhone.

MIT’s question at the time of their study (2012) was whether smartphones and other mobile devices were achieving mainstream adoption faster than any other technology in human history.

Unanswerable then and now, yet the number of users worldwide continues logging impressive growth. Tablet market adoption followed a fast track too. Mobile commerce trends both drive and benefit from garnering one third of most marketing budgets.

More to the point today, US consumers now spend five hours per day on mobile devices, with 92% of their time spent in apps. Page down a bit in that link, and you’ll see the breakdown of favored app categories, according to a study by analytics firm Flurry.

M-commerce shopping accounted for $22.7 billion (or 21%) of online spend in the 4th quarter 2016. No doubt 2017 results will outpace that. So, app developers: You’re in the right space at the right time.

Three Mobile Commerce Trends to Embrace

A Google search on “mobile commerce trends 2018” returned more than 2,000,000 results at the time of writing. Let’s review one.

Lacie Larschan, writing for Granify (purveyor of AI-based eCommerce tools) identified three customer-centric mobile commerce trends for 2018:
1. AI-Backed Everything
2. One-Click Payments
3. Blended Offline – Online Experiences
Mobile eCommerce (m-commerce) has come of age, providing opportunities for traditional retailers and eCommerce merchants alike.

Artificial Intelligence (AI)

“AI-Backed Everything” might be an overstatement for small merchants today, but there’s no doubt that AI-backed m-commerce especially helps support high risk merchants in the fight against fraud.

Financial fraud is pervasive, and on the rise. Payment card issuers, payments processors, and merchants large and small go to great effort and expense to detect and prevent upwards of $8.6 billion in fraudulent payment card transactions.

AI-based solutions help m-commerce apps fight the good fight, using machine learning and real-time fraud prevention capabilities to detect potentially fraudulent transactions before they’re completed. Machine learning-based tools can also be applied to “increase revenue, save time, and reduce costs.” That’s a win for eCommerce merchants.

One-Click Payments

Everyone who’s shopped on Amazon even once since 1997 knows about one-click payments. Patent-protected since then, one-click purchase capabilities are now in the mix for all eCommerce vendors. Because Amazon’s patent expired.

App users frequently abandon their shopping carts because it’s Too Much Trouble to enter 30-40 characters to complete an order. But they’ll do it once to set up an account, and continue shopping. Labeled the end of an era by some, it’s good news for m-commerce.

Of all the mobile commerce trends in play today, one-click payments may increase revenues most directly for app developers who choose to implement their own one-click purchase capability. Simplify the user experience, and see your repeat customer revenue skyrocket.

Blended Offline – Online experiences

Consumers want consistent experiences from a retail brand, no matter where they shop. Known as omni-channel marketing, one example of blending offline and online experience is implemented through in-store mobile apps — one of the mobile commerce trends of 2018.

Retailers like Home Depot have led the way blending offline and online shopping experiences. Customers often need help finding the product they want within a huge hardware store. Mobile commerce trends to the rescue, blending offline and online experiences.

Home Depot provides a downloadable mobile shopping app that helps in-store customers find the aisle housing what they seek. Rushed customers unwilling to wait for a “live” customer support person to show them the way find it very helpful.

No longer do shoppers rely only on imagination when shopping in bricks-and-mortar stores. Brands like IKEA utilize augmented reality technology to bring a virtual kitchen to customers through their mobile devices. The IKEA VR Experience is in pilot now.

As offline and online marketing converge, app developers play a significant role implementing retail strategies. Mobile payment solutions complete the apps and allow them to generate revenues.

Conclusion

When you need an eCommerce payment solution that both saves your money and gives you peace of mind, look no further than PayArc.

Our mission is to bridge the gap between online merchants and payment solutions — for all types and sizes of merchants and app developers. PayArc provides merchants with the latest technology and pay options allowing them to focus on growing their businesses.

PayArc’s mobile SDK makes it easy to integrate mobile payment solutions into your app.

Our industry leading payment processing solution gives you all the tools you need to start accepting payments while lowering your risk to fraud and giving you some of the lowest rates in the industry.

PayArc wants to act as your payments advisor and consultant, not only your processor. Because you have a business to run… Our business is to help you run it better. Why not start processing with PayArc today?
Payarc

November 15, 2021

Industry Insights

mobile-commerce
Mobile-First Payments: Understanding the New Way to Pay

February 2018 study from Pew Research found that 77 percent of Americans now own a smartphone. That’s more than double the amount of smartphones than when Pew first began tracking these numbers in 2011 (it was only 35 percent then). And as more smartphones make their way into the pockets of Americans, it’s more likely that they’ll turn to that device to make payments in their everyday life.

It might sound far-fetched now, but consider what happened in China: Mobile payments have swept rapidly through the country, displacing traditional payment methods like cash and credit. It’s possible to leave your house only with a phone, and pay for food, transportation, or other necessities by scanning QR codes and paying with apps like WeChat or Alipay.

Though mobile payments haven’t reached the same saturation in the US, they’re nevertheless on the rise. A 2017 report by the Mobile Ecosystem Forum said that 78 percent of people have made at least one purchase on a mobile device in the last six months.

“Clearly, the migration from desktop to mobile can only accelerate,” says Christian Von Hammel-Bonton, EVP of Global Product Strategy at Wirecard. “So my message to all businesses around the world is: if you neglect to offer services and products through the mobile channel, you will lose – not only your customers but also your business.”

Making Mobile-First Payments a Priority

This means that developing a plan to implement mobile-first payments is increasingly crucial for merchants. In order to capture business from tech-savvy users, business need to make the structure of mobile-first payments a priority.

An easy way to start making mobile payments a priority is simply to make your business’s website adaptive. This means structuring your site so it will automatically adjust to the screen size of the user browsing it. That means that whether customers are logging on from their PC or their phone, they’ll have the same experience on the site. Or, merchants can go a step further and optimize their site for mobile first. Customers will appreciate an a shopping experience that was designed for mobile users and will be more likely to make a purchase.

Having an good grasp of mobile payment is a must for merchants who hope to focus on mobile first payments. One key aspect of this is understanding how exactly your customers want to pay on mobile. While AliPay and WeChat aren’t as popular for payments outside of China, digital wallets are gaining users and popularity. Digital wallets are simply a tokenization of a user’s data stored digitally. This means that while a digital wallet can include payments (more on that in a moment), it can also include other types of data like boarding passes, room keys, or identification.

Mobile wallets (or the “Pays” — Apple Pay, Google Pay, and Samsung Pay) are what merchants who are interested in a mobile-first payments experience should be paying attention to. This is the much touted “tap and go” method of mobile payment. This technique uses a smartphone’s built in NFC (Near Field Communication wireless technology) or BLE (Bluetooth Low Energy) a payment is made to the merchant. These mobile wallets offer both convenience and security. Paying with a mobile wallet is a quick experience in a brick-and-mortar store, and is nearly instantaneous when paying online. When considering the pros of investing in mobile-first payments, merchants shouldn’t overlook the benefits to their own business: nearly instantaneous access to funds, access to real-time data, and a competitive edge that comes from giving the customer a fast and secure payment option.

But despite the fact that these mobile wallets do offer heightened security with encryptions similar to chip cards, good old card not present (CNP) transactions are still what most customers are most familiar with. Though e-wallets are burgeoning in popularity, many users will still first turn to the card in their physical wallet to make payments — even if they are making their payments on mobile. Though digital wallets and mobile payments are evolving quickly — and merchants should be keeping an eye on these trends for when (not if) they need to adopt them — to capture the most sales business should offer customers the option to perform CNP transactions on mobile.

The evolution of mobile commerce is perhaps one of the most crucial payment developments in recent years. Merchants who want to stay ahead of the curve should be looking for ways to start implementing mobile-first payments into their current business model.

Payarc

November 15, 2021

Industry Insights

mobile-apps-payments
Modern eCommerce: How to Support Your Online Business

here are numerous steps to take when launching an online business. You’ll likely acquire inventory, plan your marketing strategy and choose from several ecommerce platforms and payment solutions. There are an estimated 2-3 million ecommerce businesses in the world, with over 500,000 companies on Shopify alone. With so much competition, you’ll need every advantage. Cash flow will keep your business afloat during slow periods while smart investments help you grow. Want to know which funding option to choose? Keep reading.

Business Credit Cards

When you open a bank account, you may be offered additional services like payment solutions and business credit cards. If your personal credit rating is decent, then a business credit card can provide you with working capital. Drawbacks may include high interest rates, and annual fees, though you may qualify for introductory offers like 0% interest. Payments are flexible and you can earn points, redeemable for rewards, airfare, and cash back.

Business Line of Credit

A business line of credit is typically an unsecured loan. As some loans can approach $1 million, you may need collateral. You have a good chance for approval with a personal credit score over 600, and loans can be lump-sum, or divided into smaller amounts as-needed. Creditors provide different payment solutions and terms. Fundbox offers $1,000-$100,000, and next-day funding on 12-week term loans. Street Shares offers $5,000-$250,000 within 1-5 days and a term of 3-36 months. Other sources include Kabbage and BlueVine. Fees are generally high, at 10-40% or more, partly contingent on the term length.

Business Growth Term Loans

Business growth term loans, or term loans can quickly provide you with growth capital, without giving up equity. If you’ve been operating for at least 9 months and a decent business credit score, you may qualify for a term loan of up to $500,000 from a bank, credit union or online lender. You may need to put up your business or other collateral to secure the loan, but interest may be tax-deductible, and rates are typically low, depending partly on the repayment period. Unlike labor-intensive bank loans, the application process generally takes ten minutes with cash delivered within three days. Such funds are often used to capitalize long-term investments, like large equipment purchases, real estate, office renovations, and working capital.

Term loans are generally repaid within 3 years, and payments may be based on cash flow, followed by a large balloon payment due at the end of the term. There are three main categories of business term loans: short-term, traditional-term, and SBA loans.

Short-term loans are best for smoothing out cash flow issues when unexpected needs arise, such as inventory shortages or new business opportunities. Applications can often be filed within ten minutes, and you can have cash in hand within 2-3 days. Keep in mind that if you take out a short-term loan, you may not get approved for more funds until it’s paid off.

A traditional-term, or medium-term loan is a fixed amount used for a specific business purpose, such as purchasing property. You get more capital than with a short-term loan, and the application process may take several weeks. Once approved, you’ll receive a fixed amount of money over a fixed term, with a fixed interest rate. A record of on-time payments can improve your business credit score for future loans, though you might get penalized for paying off the loan early.

The Small Business Administration, or SBA is a federal agency that provides small businesses with education and contracting opportunities. It serves as a guarantor of bank loans offered by special SBA lenders, with many options available. SBA loans are good for companies that may not do well in the commercial lending marketplace, with opportunities available for women and minorities. Loan options include the SBA 7(a) for general business purposes, and the Certified Development Company (CDC) 504 Loan Program for equipment and commercial property. You may borrow up to $5 million, with possible prepayment fees on loans that mature in 15 years or longer. The SBA Microloan program provides $50,000 or less.

Streamlined Payment Processing

An overlooked way to keep cashflow strong is to work with a payment processing partner that caters to your unique needs as a business. For online businesses, the ability to accept credit card payments is lifeblood. Working with a reputable merchant services provider will enable you to get setup with a reliable merchant account so you can receive and manage payments from sales. They will also help you choose the right payment gateway so that you can begin accepting payments online right away, as well as a virtual terminal to securely enter credit card details when accepting mail and telephone orders.

Each of these items can impact cashflow, so be sure to choose a payment processor that offers quick funding along with trustworthy integrations, support, and fraud prevention tools.

Conclusion

You need positive cash flow to excel in business. Employees, vendors, and overhead must be paid, regardless of fluctuating revenues. Business loans and other credit can smooth out the rough spots, so think about your short-term, and long-term goals, and then plan your financing accordingly.

Payarc

November 15, 2021

Uncategorized

payment-processing
Using payment solutions to grow your meal prep business

Ecommerce merchants choose their industry sectors for many reasons. That’s half the fun of coming up with, and executing on, a business idea.

Sometimes your choice furthers a life-long passion, while other times it’s as simple as recognizing and filling a market need. Being first off-the-block is often a winning strategy for a sprint, but not so much in a marathon.

Of course, meeting market needs in the long-term isn’t really a simple affair. Long-term business viability falls more into the marathon category. What’s required are several layers of expertise — Some related to the chosen product or service, along with know-how in managing your business.

For example, a passion for healthy eating and good cooking may lead you to open a meal prep business. You’ll love the first stage, when serving delicious and nutritious food made with your own hands proves super-rewarding.

But for how long will that “hands-on” approach serve the business well, given your ambitions and the blossoming market in your chosen niche?

As your business grows, reaching out to others who possess the knowledge and skills — the expertise — you need isn’t always easy. But it might be the best option to support the growth ambitions you harbor.

Using the meal prep sector as a proxy for all ecommerce shops, let’s take a look at an example of tough decisions one merchant made while managing business growth. The business lessons demonstrated in the story remain universal, proving useful to all ambitious ecommerce merchants.

Another lesson to consider while in the growth phase of your business: Leveraging expert payment solutions helps online shops grow.

True Rapid Growth Story Shares Lessons for All

Business principles remain true for all merchants, regardless of the chosen sector. eCommerce may be relatively new, but the quest to launch and grow a business persists in all industries. Like the story of a couple whose meal prep business growth lessons will resonate with all small business owners.

Danielle Hrzic told the story to HuffPost. The Hrzics built a meal prep business to improve the quality of school lunches available in Chicago. Gourmet Gorilla began by producing meals and snacks for three area schools. Now they serve schools throughout Northern Illinois and Wisconsin.

As more schools and parents joined the service, the business outgrew their initial kitchen space, and also the ability for the Hrzics to remain “hands-on” with meal production. As Hrzic says, “Small business owners often feel the need to be a part of every aspect of the business.” Letting go can be hard.

But Danielle learned that she had to pull herself away from the business, “…to work on it instead of in it” — and the business expanded rapidly.

Merchants keen to launch their own payment prep businesses will find useful information on the sector here, including info on the types of expert payment solutions needed in the sector.

Become Expert on Business Growth

It’s one thing to work in a business, and quite another to own and manage one. Launching and running an ecommerce business, regardless of sector, takes a lot of energy and passion for what you do.

Some online merchants open up shop following business careers, but many don’t have the first clue about doing the books, ordering and managing inventory, or supervising employees. And without stellar funding and steady cash flow, hiring the expertise just isn’t possible.

Do you know about the standard business growth curve? From start-up to survival to success at various levels, and all the way up to mega-successful large corporations — five growth stages get you there.

Start-ups challenge even the best and brightest new merchants. Passion for your business only takes you so far, when cash flow makes or breaks the business. It’s financial survival that moves the company up the curve. And expert payment solutions help ensure financial success.

Reaching out to experts to help your company grow — and letting go when necessary — reflect mature resolve as an owner. Our featured story didn’t highlight payments, but it’s clear that selling to schools requires B2B payments expertise, and directly to parents means B2C payments.

Do other eCommerce merchants know enough about payments, to get past start-up and survival, then on to success? Like why a landing a merchant account reflects your best interests, and how to protect your payments from fraud? If not, payments may be an area in need of expert assistance.

Expert Payment Solutions Help eCommerce Shops Grow

No matter where your business falls on the growth curve, you need expert payment solutions to help you grow. To find payment solutions that will both save your money and give you peace of mind, look no further than PayArc.

Our mission is to bridge the gap between online merchants and payment solutions — for all types and sizes of merchants.

PayArc’s industry leading payment processing solution gives you all the tools you need to start accepting payments online, while lowering your risk to fraud and giving you some of the lowest rates in the industry.

We leverage strong industry relationships — developed over decades in the payments industry — to help you land an individual merchant account so you can start processing payments quickly and securely.

Take the headache out of credit card processing, so you can process with confidence. PayArc wants to act as your payments advisor and consultant, not only your processor.

You have a business to run. Our business is to help you run it better.

Give us a shout today.

Payarc

November 15, 2021

Industry Insights

payment-processing
HSAs and FSAs With PAYARC
If you’re a doctor or a merchant that sells medical equipment or supplies, you probably have to consider that patients and customers may want to use an HSA (Health Savings Account) or FSA (Flexible Savings Account) to pay. Perhaps you’ve been considering switching to PayArc,but aren’t sure if you will still be able to accept these forms of payments.Good news—you will! If your practice or business falls under one of the following MCCs, you will be able to accept HSA and FSA.
- 4119 –Ambulance Services
- 5975– Hearing Aids – Sales, Service, and Supply Stores
- 5976 – Orthopedic Goods, Prosthetic Devices
- 7277– Counseling Service – Debt, Marriage, Personal
- 8011– Doctors and Physicians (Not Elsewhere Classified)
- 8021– Dentists and Orthodontists
- 8031– Osteopaths
- 8041– Chiropractors
- 8042– Optometrists and Ophthalmologists
- 8043– Opticians, Opticians Goods and Eyeglasses
- 8049– Podiatrists and Chiropodists
- 8050– Nursing and Personal Care Facilities
- 8062– Hospitals
- 8071– Medical and Dental Laboratories
- 8099– Medical Services and Health Practitioners (Not Elsewhere Classified)
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Payarc

November 15, 2021

Uncategorized

payment-processing; hsa; fsa; healthcare
Mastercard Negative Option Billing Rules

Negative Option Billing is a business practice that has built a reputation as being somewhat shady or deceitful. The premise of this practice relies on the customer signing up for a service that it is a free trial or reduced price, and then once that trial is over the customer gets billed for future products at full price. For example, a customer will sign up to receive free cosmetics for one month but will have to give their credit card information to the company. The customer receives the free cosmetics in that first month, but then will be billed for more cosmetics in subsequent months. In order to avoid being billed, the customer must contact the company and unsubscribe from the service. Because this business practice relies on customers staying subscribed long enough to be charged, companies offering this service make it hard to unsubscribe.

On April 12, 2019, MasterCard established new rules regarding negative option billing. These new rules apply only to card-not-present subscription services in which the customer receives a physical product. These rules do not cover digital services,such as streaming TV or music services. If your business relies on negative option billing practices, it is important to understand MasterCard’s rules in order to avoid charge backs and possible action against you. So, what do these new rules entail?

·       Notification:A merchant offering a free trial must notify the customer once that trial has ended, before charging the customer. The customer must also be notified of the transaction amount, the date of transaction, the merchant name, and how to terminate the service at any time.

·       New MCC: Any merchant offering a free trial of a physical product will be assigned an MCC of 5986 – Direct Marketing: Continuity/Subscription Merchants.

·       High Risk Classification:Merchants who make use of negative option billing are classified as “high risk,” which may affect a merchant’s credit card processing fees.

·       Permission: The merchant must obtain explicit permission from the customer before charging their card.

·       Trial Period: Instead of the trial period beginning once the customer completes the transaction, the trial period must begin on the day that the customer receives the product.

·       Verification: Acquiring banks must monitor and verify multiple purchases from the same account holder.Merchants must be able to provide proof of sale for a year.

·       Customer Service:A customer service phone number must be available on the website when that site is down for maintenance.

·       Cancellation: A merchant must provide the customer with clear, direct instructions on how to cancel their subscription on their website and on customer receipts. If a customer cancels the subscription, the merchant must provide written confirmation of that cancellation.

·       MasterCard Registration Program:Acquiring banks must register merchants using negative option billing and any third-party service providers in the MRP.

Need help keeping track of these rules and staying compliant? PayArc can help! Call or email us today to help get started with a merchant account.

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Payarc

November 15, 2021

Industry Insights

chargebacks; payment-processing; mastercard
Merchant Account Providers Vs Processing Aggregators
Are you planning to launch a new eCommerce business? What an exciting, busy time it will be — if a bit scary.

Of course, if you’re a veteran of online merchant gigs, you’ve no doubt learned a thing or two about launching and building an eCommerce business.

But have you learned enough to find early success with your new venture? Like are you au fait with payment processing… including the benefits of merchant account providers vs processing aggregators?

You’re determined to choose wisely — to support your business needs now, and beyond the heady launch days.

American comedian Eddie Cantor said, “It takes 20 years to make an overnight success.” But does it really? Perhaps by understanding your payment processing choices, and choosing wisely to support your unique needs, it won’t take that long.

Let’s take a look at what merchants need to know about merchant account providers vs processing aggregators.

Key Terms — A Very Good Place to Start

Defining key terms helps ensure we’re on the same page.
- Merchant Account Provider (MAP): Payment processors that help merchants attain their own — individual — merchant accounts at acquiring banks. Without a merchant account agreement (between the merchant and a bank), businesses cannot accept payment cards to sell goods or services.
- Processing Aggregator: Also called payment aggregator, or simply an aggregator, these services utilize their merchant accounts to process payments for many, many merchants — who don’t require bank approval, and face very little scrutiny. Well-known aggregators include PayPal, Stripe and Square.
Processors of either type act as middlemen between merchants and payment card companies. They send transaction data (like payment card number and purchase amount) to the card networks’ interchange, to be routed to customers’ issuing banks for approval.

Approved and settled transactions result in money being deposited via the funding process into the related merchant account, to be paid eventually into the merchant’s business bank account.

Every Business Choice Brings Pros, Cons, and a Few “Gotchas”

When seeking to make your merchant account providers vs processing aggregators choice, pay attention to the pros and cons of each. With many choices available, what matters is what’s best for your business.

So be sure to identify your requirements, growth plans, and what you care about most. Don’t simply take the easy route. If you’re concerned about business longevity, do your due diligence and choose carefully.

Pros and cons — and “gotchas” to watch out for — of merchant account providers vs processing aggregators include:

Start Up Process: Aggregators represent a low entry barrier. With almost no scrutiny applied to merchants’ personal credit histories or business plans — no application fees — and relatively easy implementation, new merchants can be up and running very quickly.

Because little scrutiny is applied to applicants, the mix of merchants using processing aggregators carries a higher risk for fraud than most merchant account provider portfolios, leading to another issue…

Account Stability: Unfortunately, the primary aggregator reaction to suspicious activity or irregular transaction behaviors is to:
- Freeze your account,
- Hold your funds for up to 180 days, and/or
- Terminate your account…
…Often without warning.

So yes, landing your own merchant account means a lengthier application process because bank underwriters perform due diligence to understand your business plan, personal credit history, and industry focus before approving your application.

But once approved, you’ll see fewer interruptions to your payment processing. And merchants will be notified if unusual activity occurs — rather than waking up to a frozen or terminated account.

Customer Service: This is the least appreciated aspect of the aggregator business model. PayPal finally added “live” customer support capabilities after years of complaints about slow, ineffective email support. Now, merchants who don’t want their calls to languish in a queue purchase “Enhanced” or “Premium” support services ($159 or $459 per month). Stripe and Square offer only email support. Their merchants complain about slow response times too.

Funding: Did you notice the use of eventually above? Well, when you process with an aggregator, the monies earned flow into the aggregator’s merchant accounts, not directly to the merchants who made the sales. Merchants may need to request their funds from an account portal, following a set schedule (PayPal). If merchants want their money more quickly, they can request it and pay an extra fee.

Aggregators may take up to a week to transfer the money you earned (minus their fees) to your business bank account, whereas a merchant account provider transfers gross funds within 1-2 business days and bills merchants monthly to collect processing fees.

Processing Costs: Aggregators’ rates are fixed for all merchants. Easy to understand, the rates include a fixed percentage of each transaction amount, plus a flat fee. For example, one aggregator charges 2.9% plus $0.30 per transaction. Note that aggregators are also adept at creating and charging additional fees for services often provided at no extra charge by MAPs.

On the other hand, merchant account providers offer more competitive pricing because they tailor rates to each business, sometimes offering very competitive rates.

Aggregator fixed rates work well for startups that process few transactions, but become quite pricey as businesses grow. Not only that, but processing aggregators enforce low processing limits. Exceed the limit, and risk account termination.

So merchants wanting to grow their businesses quickly — and without harsh limits — will find their interests better served by merchant account providers vs processing aggregators.

Only you can decide which better serves your needs, merchant account providers vs processing aggregators. Just remember that your business success is at stake when you make your choice.

Conclusion

When you need an eCommerce payment solution that both saves your money and gives you peace of mind, look no further than PayArc.

Our mission is to bridge the gap between online merchants and payment solutions — for all types and sizes of merchants.

PayArc’s industry leading payment processing solution gives you all the tools you need to start accepting payments online, while lowering your risk to fraud and giving you some of the lowest rates in the industry.

We leverage strong industry relationships… developed over decades in the payments industry… to help you land an individual merchant account so you can start processing payments quickly and securely.

PayArc wants to act as your payments advisor and consultant, not only your processor. Because you have a business to run… Our business is to help you run it better. Why not start processing with PayArc today?

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1. Top 6 Considerations Your Mobile App Payment Gateway | PayArc – […] is often the least appreciated aspect of the payment aggregator business model, along with funding timeframes and account stability.…
2. How to Use Expert Payment Solutions to Grow Your Meal Prep Business | PayArc – […] enough about payments, to get past start-up and survival, then on to success? Like why a landing a merchant…
3. Card Brand Fees 101: Understanding Network Access and Brand Usage (NABU) Fees | PayArc – […] the money charged for card brand fees goes to the card (VISA, for example), the credit card processor doesn’t…
Payarc

November 15, 2021

Industry Insights

payment-aggregators
Midigator: Simplify Your Payment Disputes
Chargebacks are a huge problem that face merchants today. The incidence of friendly fraud is around 23% of all fraud claims, so disputing chargebacks can be a big benefit to your business. There are several services designed to help merchants manage their chargebacks, including Midigator: a user-friendly, effective software with many features to make disputes easy to keep track of. If you’re concerned about how chargebacks are affecting your business, consider monitoring them using Midigator.
- Intelligent Dispute Responses: This feature will generate a customized chargeback response that analyzes evidence relating to the chargeback and helps you build a package to win the dispute.
- Chargeback Prevention Alerts: When a customer disputes a transaction and the issuing bank sends an alert through the network, Midigator informs you of the chargeback and allows you to easily refund the customer, stop order fulfillment, and update order information. Once this has been done, the dispute is resolved and no chargeback occurs.
- In-Depth Analytics: With the analytics feature of Midigator, you can identify marketing strategies that produce more high-risk customers and discontinue them, while also zeroing in on strategies that produce loyal customers; determine the chargeback reason code that most often turns up in order to reduce friendly fraud; find out when in the subscription cycle customers are most likely to file a chargeback and remind them of your cancellation policy instead; learn which products are being charged back the most and reduce the risk by removing those items from your inventory; discover new markets overseas and see if the reward is higher than the risk and which price point is most likely to make customers charge back the purchase; and determine the preferences of different issuing banks to create the best strategy for winning a chargeback.
- Custom Notifications: Pick which metrics you want to monitor and receive email or dashboard notifications about them: Chargeback Ratio, Chargeback Count, Chargeback Dollar Amount, Total Sales, Transaction Counts,and Card Network Regulations.
- Real-Time Account Reporting: Midigator compiles your data for you to see in real time so you can make educated decisions about your business.
- DisputeFlow: Instead of manually downloading chargeback data from different portals, copying and pasting data into documents, struggling to understand submission expectations, and wasting time searching for response results, Midigator’s DisputeFlow feature receives all chargeback information in a single portal,builds dispute responses, sends packages with one-click submissions, and monitors detailed reporting and automatic results. This significantly cuts down on the time and frustration spent on fighting chargebacks.
Midigator is a unique software built for merchants, by merchants. If you want to prevent chargebacks and reduce payment processing risk, fight chargebacks and recover lost revenue,and automate tasks and streamline processes related to chargebacks, Midigator may be right for you. After all, your business depends on have the least chargebacks possible!

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Payarc

November 15, 2021

Fraud Prevention

chargebacks; fraud-prevention; payment-processing
How to beat business goals without breaking the bank
Business objectives drive the best choices every business owner makes.

At least, owners wanting to make money in the real world look to their business objectives when deciding how to take products to market.

Mobile app monetization represents one such choice that all app developers must make. Have you thought that through for your app?

Of course, you may have embarked on developing an app just because you love mobile technologies, and wanted to make your mark among tech peers.

If that’s the case, then good luck to you!

But if your objectives include earning your share of the projected $101 billion (with a B) app store revenue, then you owe it to yourself to learn more about mobile app monetization.

Let’s look at mobile app monetization models — and how to monetize your app without breaking the bank — by choosing the right business partner.

Considerations for Mobile App Monetization

Several models exist that support mobile app monetization. Which one is right for you? You may want to know which monetization model drives the most revenue, but no simple answer exists.

What really matters is that the monetization model you choose best suits your app. It needs to support your revenue and user adoption objectives — along with the product or service you’re taking to market.

Before you can choose the right answer for your business, it pays to be sure you’ve done the right marketing analysis. Such as:
- Who is your target audience? Determine their demographics and app usage patterns. Do they prefer video or perhaps written content consumption? Align your choices with the behaviors of your target market.
- Your Core Set of Users Includes ___? The most successful apps address a specific user pain-point. That’s a Marketing 101 truism. Yet many business owners overlook that solving a problem — aka providing value — for specific users generates profitability.
- Choose the mobile app monetization strategy which rewards match your app’s user value. Simply put, the more value provided by the app, the more users will be willing to pay.
Choose Among Mobile App Monetization Models

Pay Per Download: This is perhaps the most common approach to generating revenues with an app. But how do you convince a new user to pay the price you demand without letting them to try it first? If you can’t market your app as truly unique — compared to all the free apps out there — keep looking. Great marketing and PR are imperative with this model

Advertising App Monetization Model: You’ll find more people willing to download your app with no cost barrier (as in pay per download apps). The advertising model offers several “flavors.” It’s often used in mixed-model approaches. Common ad formats currently include:
- Banner Ads
- Native Advertising
- Video Ads
- Voice Ads
- Interstitial Ads
- Rich Media Ads
- Location-Based Ads
- Pop-Up Ads
- Notification Ads
You’ll find examples of these ad types here, here, and here.

Choose the advertising app monetization model if you expect users to visit the app frequently, and stay awhile during each session. You’ll also need to collect user demographic and behavioral data to ensure ads are relevant.

In-App Purchase Monetization Model: Do you plan to sell virtual or physical goods or services from your app? This model works well for retail, gaming, or services apps. It’s been the top mobile app monetization strategy used by high-earning game apps. Be sure to include well-designed purchase incentives that don’t spoil the user experience.

Freemium App Monetization Model: This strange-sounding model replicates the subscription model used in many ecommerce businesses. If you can attract free users, and then entice them with super-unique premium features, choose the freemium app monetization model. The 30 top grossing apps in the Apple App Store may be downloaded for free, but they all offer desirable premium content for a fee.

Subscription or Paywall Model: This app monetization model is similar to Freemium, but content is locked, not premium app features. Users are able to view a specific amount of content for free, but then must subscribe to the app to view more. Service-oriented apps succeed with this model (think Netflix or Spotify). The Subscription or Paywall model works well when the app itself inspires repeated — and frequent — use.

The bottom line is to choose the mobile app monetization model that fits your objectives, and the analysis of your target market. In-App Purchases and Subscription models continue to be most successful at driving revenue (33% and 22% respectively), according to a recent study by Apptentive. But a hybrid approach may be best for your app. Let objectives drive the choice.

Put a Cherry on Top with PayArc

Regardless of which mobile app monetization model you choose, your business definitely requires the right payment processing capabilities. They provide the cherry on top when you go to market!

Because, if you cannot accept payments via your app, then dreams of monetization go out the window. Be sure to choose a processor with a mobile app payment gateway optimized for your success. Choose PayArc.

Our mission is to bridge the gap between online merchants and payment solutions — for all types and sizes of merchants and app developers.

PayArc provides merchants with the latest technology and pay options allowing them to focus on growing their businesses. And PayArc’s mobile SDK makes it easy to integrate mobile payment solutions into your app.

Our industry leading payment processing solution gives you all the tools you need to start accepting payments while lowering your risk to fraud and giving you some of the lowest rates in the industry.

PayArc wants to act as your payments advisor and consultant, not only your processor. Because you have a business to run… Our business is to help you run it better. Put the cherry on top… Start processing with PayArc today.
Payarc

November 15, 2021

Security

mobile-apps-payments