Free Your Business From Payment Data Silos
The word “silo” originates from the Greek word “siros”, which means “a pit to keep corn in.” And there might be nothing more nostalgic than a picturesque red barn with corn silos. Those in technology have a different thought: one of “data silos.” In the era of big data, data silos are a topic of interest and not so nostalgic. Instead, the conversation revolves around how bad silos can be and how to get rid of them in order to free our information. Commonly, this means a company has internal data buried deep within its systems. It wants to surface the information for wider and more beneficial usage throughout the organization or the world at large.
It means the same to us here at Spreedly. We have revived our Payment Gateway Index and turned it into Spreedly Open Data. Open Data is our effort to share with the payment industry the tremendous amount of performance data we collect. With Open Data we bring to light data that allows online marketplaces, merchants, payment providers and other PCI compliant service to compare the performance of payment participants so that the entire industry can do more than just compete solely on price.
We also released a tool so our customers can better measure and track the performance of their payment gateways. It’s called Insights.
And we’re always publishing articles and studies on payment processing data.
However, there is another way to think about data silos. That is from the perspective of our customers. Our customers often ask us about the flexibility of payments. For example, “How can I make my payment system more flexible and resilient?”
Most modern payment gateways are good at what they do. They also share similar characteristics. They use the latest technologies to provide a secure way to obtain and store payment methods in order to conduct e-commerce transactions on behalf of merchants.
So then where do our customers’ question originate? What is it that they dislike about today’s gateways?
Flexible Payment Options
It comes down to flexibility. Beyond the ability to capture and store payment information, are you able to use the data flexibly? In this respect, the flaw we often hear is payment gateways are unable to do all the things customers need to do really well.
Customers find some gateways are good because they connect to a lot of banks and acquirers, but maybe their fraud solution doesn’t improve success rates. Or maybe they have a lot of functionality for subscription payments, but they don’t have a lot of customization in their iFrame, leading to cart abandonment. A lot of times it can be because the payment gateway just doesn’t have an API that is easy to work with.
Soon customers end up in a bind. They find themselves in a situation where all their information is in a payment vault with a single provider. The customer is now stuck using the provider no matter the terms. Maybe the fraud solution is too expensive. Or maybe it’s not the raw expense that hurts. Rather, the fact that it’s unable to screen enough fraudsters and increase successful transactions means the ROI is low. Not to mention the inability to send payment information to a 3rd party API. We refer to this as payment gateway lock-in.
Avoid Payment Data Lock-In
Businesses can solve for this, but it requires a big step. And this step isn’t easy. Pull payment data in-house by building a card data environment (CDE) and creating multiple integrations. Do you hear the sound of money blowing out the window? An internal CDE isn’t desirable because it’s not aligned with your business. Executing on this type of initiative is a drain on multiple resources: time, money, and personnel, to name a few. Any cost savings and optimization you were trying to achieve by doing it yourself is lost.
Instead, a more elegant solution is to find a service that can handle the needs and flexibility of your business and store your payment data for you. This also allows you to make better use of your resources and deploy them toward your business’ core product.
Here are three things to look for to make sure your payment information isn’t locked up in a data silo.
- Find a provider that can securely vault the data for you but leaves it completely under your control and ownership. Don’t forget to make sure that the service is PCI compliant.
- Check to see if the service has the flexibility to transact with multiple payment gateways and 3rd party API services that meet the exact needs of your business.
- And finally, ensure the provider provides open portability of the data. If you leave, your payment data needs to leave with you without any friction or exorbitant fees.
Companies that do this can insulate their business for the long term. By disaggregating your data from the services you regain the scale and flexibility required to run a thriving enterprise.
Here at Spreedly we strive to enable a world where our customers have their payment information in their hands. We also want to ensure that this data is made readily available to provide the right service at the right time without restriction for the benefit of their own customers.
If you would like more information about how Spreedly helps companies break payment data silos, read more about our PCI compliant payment solutions, where you will learn about the Spreedly vault and our unique product offering, Payment Method Distribution (PMD).