Turning transactions into growth: A guide to integrated payments for ISVs
From monetization models to white-label solutions, learn how independent software vendors (ISVs) can integrate payments to unlock new revenue streams.
Payment integration is rapidly becoming a strategic pillar of ISVs’ business models. Beyond enhancing the overall value of their platforms for customers, embedded payments unlock a lucrative new revenue stream, boosting profitability.
The numbers speak for themselves: McKinsey found that 50% of small businesses now use ISVs as payment providers, with another 15% planning to transition to them. For new businesses in particular, ISVs have become a popular choice for payment processing support.
This demand for integrated payments presents a significant opportunity for ISVs. By providing seamless, secure payments, they can unlock transaction-based revenue while enhancing the value of their core offerings.
However, navigating the path to payment monetization comes with its own set of challenges; each of which require the guidance of an experienced payments partner to overcome.
Why ISVs are prioritizing payment integration
Software vendors typically integrate payments with the following goals in mind:
Enhancing the user experience: Integrated payments enable users to complete transactions within the same platform, eliminating the need for third-party redirects or extra steps during checkout. This streamlined experience boosts satisfaction and conversion rates.
Increasing customer retention: Seamless, built-in payment solutions increase customer reliance on the platform, making them less likely to switch to a competitor that offers similar all-in-one functionality.
Gaining a competitive edge: In a crowded market, integrated payments help ISVs stand out by delivering a comprehensive end-to-end solution—especially in complex verticals like healthcare and property management.
Finding new revenue opportunities: Integrated payments allow ISVs to tap into transaction-based revenue, turning their platforms from simple service tools into powerful revenue generators.
Three major payment challenges ISVs face
1. Legacy technology that holds back growth
Many payment providers struggle to deliver integrated systems that run efficiently and reliably. ISVs need partners that constantly innovate, responding to new technologies, evolving consumer demands, and changing industry regulations.
Unfortunately, many ISVs partner with providers that can't keep pace, leaving them to rely on outdated or ineffective payment systems that limit growth and user satisfaction.
2. Revenue models that struggle to scale
Payment providers often offer the same referral-based models they have been using for years, putting ISVs at a disadvantage.
In these setups, ISVs must contact their payments partner with the details of each new client to manually onboard merchants individually. This process is time-consuming and can lead to delays in receiving revenue. Even worse, referral models typically offer ISVs only a limited share of transaction fees, significantly reducing their earning potential.
Over time, these inefficiencies can also introduce reputational risk, as users grow frustrated with clunky payment experiences and inconsistent service.
3. Solutions that don’t flex to their needs
ISVs often serve industries with highly specific needs. Yet, many payment providers offer one-size-fits-all solutions that lack the specialized features required to support the verticals they serve.
These providers often lack a deep understanding of the ISV’s platform architecture and business objectives, and their cookie-cutter solutions fall short when addressing unique or complex requirements, resulting in performance issues.
The route to payment monetization
ISVs typically take one of two paths to integrate payments. The first option is to become a payment facilitator (PayFac) and build an embedded payment solution. While this offers control over the payment process, it's also costly, requiring considerable upfront investment and ongoing compliance costs, including Know Your Customer (KYC) and Anti-Money Laundering (AML) checks.
The second approach is to partner with a provider that offers complete control over the payment experience without the administrative burden. Paysafe’s ISV program delivers exactly that: all the tools a software vendor needs to manage and monetize payments, without the setup costs, compliance headaches, or lengthy onboarding process.
Through a single integration, ISVs can start operating within the Paysafe ecosystem while maintaining full compliance. The solution is fully brandable, so software vendors can white label the experience, control pricing, and take full ownership of the payment journey. This approach not only simplifies operations but also enhances the user experience by keeping customers within the platform for a smoother, more intuitive checkout.
Looking for the right payment partner for your software business?
Here are four compelling reasons to consider Paysafe
Flexible monetization models
Paysafe offers two monetization options that go far beyond standard referral models:
1. SplitPay helps your company get paid faster by automatically extracting your share of revenue from each transaction—before the funds are settled. This simplifies complex revenue-sharing models and improves cash flow.
2. SplitPay with Fee Redirect provides full control over billing. Instead of us charging your merchants for processing fees, we bill you directly, so you can send merchants a single, white-labeled invoice that includes both software and processing costs. The result: greater brand ownership, simplified billing, and flexibility over how you present your service.
White-label technology
Our white-label payment solution seamlessly integrates into your software platform, supporting major card networks as well as alternative payment methods, such as digital wallets and eCash. A customizable interface creates a cohesively branded user experience that fosters trust and credibility.
Fast, hassle-free onboarding
Merchant onboarding happens in six easy steps, with approvals often taking just minutes. Our infrastructure handles underwriting, KYC checks, and risk screening, so you can get up and running quickly without compliance concerns.
Expert support
Our support teams deliver exceptional, responsive customer service. Recently awarded Best Credit Card Processor for Specialized Businesses by Business.com, Paysafe takes a consultative approach to ensure you receive a setup that not only meets your current needs but also scales with your business as it grows. With flexible solutions and expert guidance, we help you establish a solid foundation for long-term success.
Simplifying the path to payment success
More software companies are realizing that payments aren't just a backend function—they're a proven way to drive revenue and deliver meaningful value to customers. But creating a standout payment experience takes more than a basic plug-and-play solution; it requires a payment partner with the expertise, technology, and monetization model to help you succeed from the outset.
With 29 years of experience helping businesses grow with best-in-class payments, Paysafe delivers the fuel to power ISVs into their next phase of growth. Through user-friendly APIs, streamlined merchant onboarding, diverse payment methods, and global scalability, our platform gives businesses the tools to thrive.
Want to learn more about boosting profitability through integrated payments?
Download our whitepaper, The Freedom to Get Paid: Empowering ISVs with Control, Flexibility, and Profitability, to learn how future-focused ISVs are thinking about payments, overcoming challenges, and building momentum with Paysafe's PayFac-as-a-Service solution.
