How SaaS Platforms Can Save on Payment Monetization

on Jul19
payment monetization
Written by
James Davis
Written by James Davis
Senior Technical Writer at United Thinkers
Author of the Paylosophy blog, a veteran writer, and a stock analyst with extensive knowledge and experience in the financial services industry that allows me to cover the latest payment industry news, developments, and insights. Read more
payment monetization
Reviewed by
Kathrine Pensatori
Product Specialist at United Thinkers
Product specialist with more than 10 years of experience in the Payment Processing Industry. I help payment facilitators and PSPs solve their various payment processing issues. Read more

Payment Monetization: Savings and Indirect Costs

Traditionally, software-as-service platforms did not provide merchant and processing services. Merchant services were provided by ISOs and other intermediary entities. Presently, however, SaaS platforms are in position to profit from merchant services instead of third-party intermediaries. Embedded payment features allow them to provide these services in addition to their core offerings. A SaaS company can sell its core product complete with payment functionality as a value-added offering. For this offering it can charge additional merchant services fees. This is the key payment monetization principle.

Specific mechanisms which a SaaS platform can monetize, are rather diverse. They include various markups, advanced payment features, diversified payment plans, transparent reporting, and payment hardware leasing. Some platforms can offer custom services for subscription-based businesses and franchisors, again, for additional fees.

Detailed description of all these payment monetizing tactics is available in the payment monetization guide.

In this article, however, we’d like to focus on savings and indirect costs, related to payment monetization.

How Payment Monetization Increases Savings and Reduces Indirect Costs

Most people would associate payment monetization for platforms with increasing of multiple revenue streams. However, embedded payments help SaaS companies not only increase their profits, but also effectively reduce their costs. As a result, they get an opportunity to streamline more funds to development of their core products and services. Indeed, a dollar saved is a dollar earned.

For example, integrated payments allow you to reduce the merchant onboarding cost. Moreover, as merchant statements become more transparent, you are also saving funds on tech support. Transparent reports reduce the number of support calls from the customers, as clear reporting data answers all their potential inquiries.

Besides that, a SaaS platform can motivate its merchants to consolidate their processing volumes. If merchants consolidate payments, it would be easier to negotiate better deals with underlying processors. Indeed, many businesses and platforms still consider processing costs the key factor when selecting a payment solution.

Concluding Remarks

SaaS platforms can both profit from and save on payment monetization. That is, in addition to monetizing payment features they add to their core offering, they can also reduce indirect costs.

The flexible white label payment gateway technology UniPay Gateway, already implemented by multiple SaaS companies, can make the process smooth and seamless. It will allow your platform to both earn and save money on payment monetization. Feel free to contact us for details and don’t forget to check out our comprehensive payment monetization guidelines.

Recommended to you

Previous postPayment Monetization for SaaS Companies Next postGlobal Payment Solutions for Indian Platforms

Copyright© 2024, United Thinkers