Build vs. Buy Part 02: Taking Payments In-House With Embedded Finance

Platforms need payment facilities which is why many are becoming payment facilitators leveraging embedded finance to create new revenue opportunities. 

In Part 01 of our Build vs. Buy series, we unpacked the costs and risks of building your own payment platform, digging into issues like compliance, cost, anti-money laundering (AML), know your customer (KYC), and so much more. In part 02, we look at how companies enjoy all the benefits of becoming a payment facilitator without the burdens of cost, compliance and complexity. 

Leveraging embedded finance capabilities and next-generation technology, companies can benefit immensely from this approach. It allows you to seek new revenue opportunities, improve customer experiences, reduce friction, enhance cash flow and refine your processes. 

So, what do you need to know about becoming a payment facilitator or payfac? 

What Exactly is Payfac?

Whether you are an eCommerce platform, an accounting tool, a charity or fundraising platform, a booking service, a travel service, an events platform, or a retail outlet (among many other evolving and innovative payment platforms or marketplaces), you need a payments service that allows for your customers to easily manage their payments, charge their customers, and get paid.

A payfac solution built with someone else’s technology can deliver an array of services customised to suit what your platform and customers need. UNIPaaS allows you to white-label our technology within your ecosystem, so it is your brand and your platform that connects with your customers. Using a white-labelled solution, you own the entire payments ecosystem without the challenges of building your own payfac technology. Just take a quick read of our Part 01 post to unpack the fairly exhaustive list of things you need to remember if you want to build your own payments solution in-house.

Payfac, with a proven service provider, essentially gives you all the tasty goodness of a well-designed and well-managed payments solution without the hassle and the cost.

Hang on, what about traditional payfac solutions?

You can still turn to the more traditional method of managing payments within your platform if you want. A traditional payment facilitator solution is essentially:

  • A payfac solution that asks you to set up a merchant ID and bank account so you can take payments from other merchants. You register your merchant ID with an acquiring bank and all transactions sit under your name.
  • You taking control of onboarding, KYC, AML, auditing and PCI compliance, which is a challenging and rigorous process that expects you to stay ahead of regulations while juggling a significant amount of admin.
  • You needing to manage a variety of different rules, relationships, and payment systems to ensure that your merchants are paid, that the banks are receiving the right information, and that you are aligned with different rules and regulations.
  • Oh, and if your merchants start earning over a certain threshold, they have to create their own relationship with the acquiring bank and get their own merchant ID, which can be frustrating when they’ve already got a relationship with you.

The immense value of becoming a payfac

An in-house payment facilitator platform that leverages the unique capabilities of a service provider like UNIPaaS essentially ticks all the boxes demanded within a traditional payfac system but without the complexity and the costs.

While there is merit in building your own traditional payfac platform, there’s also this very long and impressive list of benefits that come with leveraging a trusted technology such as UNIPaaS:

  • Quick and easy time to market with a much lower cost-to-benefit threshold and financial investment.
  • Immediate access to an array of features, capabilities and services allows you to smooth over the payment pathway for your customers and create new revenue opportunities.
  • A fully embedded payment solution that allows you to rapidly gain a foothold in your market and launch a new business at speed and on a budget while providing an agile and customisable payments experience.
  • Automate invoices and payment requests and ensure your customers are paid instantly with open banking.
  • Own the customer experience with a rich ecosystem of payments accessibility and management tools that increase customer loyalty and lifetime value.
  • Control customer and payment journeys to create a frictionless and streamlined experience within a unified system that allows your customers to gain control over their funds and cash flow.
  • A fully white-labelled payment platform allows you to embed financial services into your digital platform and provide a range of valuable functionalities that support your customer’s business needs.

UNIPaaS is a prominent player in the payfac space, providing comprehensive capabilities while reassuring you of absolute compliance and security. UNIPaaS has invested heavily into compliance and security - the hallmarks of an established payfac solution that understands the market and customer needs - and we consistently evolve our offering to ensure these services remain a priority.

The UNIPaaS advantage

In addition to compliance, security and seamless capabilities, UNIPaaS is also designed to make integration as easy as possible. You want a payfac solution that makes integration seamless and has a low barrier to entry and this is what UNIPaaS is committed to providing.

Our established and proven payfac solution provides pre-built integrations, developer-friendly APIs and all within user-friendly interfaces that reduce the time and effort required to implement the solution while simultaneously improving user experiences. UNIPaaS is also PCI DSS compliant - a compliance that reassures you that we’ve taken steps to ensure the protection of your data and the security of your payments ecosystem.

Do you want to know which payfac option to choose? 

To determine which payfac option works best for your business, ask yourself these questions:

  • Do I want granular control over the customer experience while creating new revenue opportunities within an ecosystem that can evolve and adapt to suit my changing requirements as a platform?
  • Do I want to enjoy the benefits of a compliant and secure payments solution that is aligned with regulations and provides my customers with ongoing assurance and peace of mind but without having to build, maintain and manage it?
  • Do I want to use next-generation technology that can be implemented fast so I can operate even faster?
  • Do I want to invest in my core business or a high-maintenance payfac ecosystem that costs time, money and expertise?

Grow with UNIPaaS

UNIPaaS allows you to say YES to ease of use and intelligent payfac immediacy and NO to ongoing complexity, with an array of additional benefits that will support your growth and your customers.