Merchants around the globe rely on marketplaces to connect with customers and facilitate transactions. What makes one marketplace platform stand out from the next is payment capabilities.
In particular, a great marketplace payment solution should not only execute seamless checkout experiences but also offer merchants the chance to build their ideal payment tech stack.
Marketplaces need well-designed payment solutions to attract and retain merchants — but what makes such a solution great and which features should marketplaces be prioritizing?
Join us today as we discuss what establishing an effective, efficient marketplace payment system really takes.
What Does the Marketplace Payments Process Entail?
Marketplace payments encompass the transactions and payment processing that can occur across various marketplace platforms. In a marketplace payment system, the marketplace facilitates all transactions.
For individual merchants, marketplace payments are often essential for operating their digital storefront. This makes it crucial for marketplaces to consider the needs of their merchant clientele and implement a payment infrastructure that meets these needs.
Let’s look at the three key participants in marketplace payments:
- The Merchant: The merchant is the participant actively using the marketplace payments system. For merchants looking for the right marketplace, one key factor to keep in mind is the scope of each marketplace’s payment process and whether or not it reaches the merchant’s target customers.
- The Marketplace: The marketplace is responsible for implementing and maintaining a marketplace payments system. Marketplaces can accomplish this independently or in partnership with a payment platform or payment service provider. When a marketplace is determining how to design and implement its payments system, three factors must remain priorities — cost efficiency, time efficiency, and global reach. Additionally, marketplace payment systems need to account for the regulatory requirements at play in all the regions where that marketplace is available.
- The Payment Platform: Without the right payment platform solution, marketplaces bear the responsibility of developing, implementing, updating, and maintaining an entire payment infrastructure in-house. This can be a daunting and time-consuming task, especially if they don’t have a large IT budget. Payment platforms serve as a vital middleman, enabling marketplaces to easily integrate a variety of different payment services with ease.
As for the actual marketplace payments process, this involves several distinct activities and processes, all of which need to be as seamless as possible to ensure a great payment experience for both merchants and their customers. This can include:
- Payment Gateway Integrations: Payment gateways play a huge role in the marketplace payment process, as they provide merchants’ customers with the payment portal for completing a purchase. Gateways not only facilitate the checkout process but also collect the relevant payment information to then send to a payment processor to validate the transaction.
- Transaction Optimization: A lot goes into a successful and efficient transaction besides the right payment gateway integration. Marketplace payments should provide the tools and capabilities necessary for routing and retry of card payments, as well as a variety of alternative payment methods, to best serve the widest range of customers.
- Payment Data Storage: In many cases, marketplaces offer to store customer payment information to make future checkouts easier and more convenient. To safely and legally store this payment data, marketplace payments systems need the right protocols and compliance strategies in place to ensure that data is secured and aligned with regulatory requirements.
- Payment Connections: For a marketplace payment system to be as optimal as possible, a wide range of available payment connections is required. These connections include not just gateways but also bank redirects, cash-based vouchers, bank debits, bank transfers, Buy Now Pay Later (BNPL), digital payment wallets, and traditional debit and credit card payments.
Key Features to Look for in a Marketplace Payment Solutions
For marketplaces looking for a marketplace payment solution that can meet all of their unique payment needs, it is critical to know what to look for in such a solution.
Here are three features that should be prioritized when selecting a marketplace payment platform:
1. Fast Merchant Onboarding
One of the most essential features to look for in any marketplace payment solution is an efficient merchant onboarding process. Marketplace payments can quickly become complicated if the solution a merchant chooses does not offer streamlined onboarding.
Ideally, merchants need the ability to get started quickly by bringing their own set of preferred PSPs, gateways, and other key tools to the marketplace. The marketplace should enable merchants to easily set up and connect to this unique set of payment services and tools, rather than requiring merchants to switch providers or use non-preferred connections.
With an ecosystem of ready-to-launch payment integrations in place, marketplaces can not only onboard merchants with greater speed but also help merchants achieve an exceptionally fast time to market.
2. Value-Add Services
Making a marketplace successful is all about attracting and retaining merchant clients — and what better way to do that than with optional value-add services?
The ability to offer value-add services to merchants enables marketplaces to embrace upselling opportunities and provide greater overall customization to merchant customers.
With the right mix of value-add services available, this can assist merchants in building custom marketplace payment solutions that meet their exact needs according to the volume of business they handle and other key factors.
Additionally, value-add services can be the key to maximizing revenue for both the marketplace and its merchants. For instance, account updater technology can be an excellent value-add service that enables merchants and marketplaces to keep payment methods up-to-date, helping facilitate a more streamlined and frictionless checkout experience.
3. Agnostic Orchestration Capabilities
In many cases, a payment service provider (PSP) may offer marketplace payment solutions that are specific to that provider’s products and services. For instance, a PSP that offers a payment gateway product may not offer integration capabilities for gateways developed by other brands.
Though this can be a good option for some marketplaces operating in limited capacities, the true power of marketplace payment solutions is found in agnostic orchestration — a type of payment orchestration that is not specific to any one brand or provider, offering connections to products and services from many different providers around the globe.
The ability to connect to more than one provider’s products and services is vital for achieving a marketplace payment system that is flexible, adaptable, and scalable on a global level.
Spreedly is the Only Marketplace Payment Solution You Need
Here at Spreedly, our payment orchestration platform is made by merchant and marketplace experts.
Along with offering automation, multi-bank connectivity, and agnostic orchestration, Spreedly offers many additional features that ensure your marketplace transactions are speedy and secure.
Key benefits of Spreedly for marketplaces and merchant aggregators include:
- Minimized payment infrastructure costs and risks
- Compliance management and updates
- 120+ payment service connections and integrations
- Accelerated merchant onboarding
- Increased revenue via transaction optimization
- Competitive differentiation in your target markets
Contact the Spreedly team today to embrace the power of automated, agnostic marketplace payments.