What Are Integrated Payments: Meaning and Benefits for Your Business

Businesses that accept in-person payments or payments online know how critical the checkout experience is for their customers. A more efficient checkout process can be the tipping point for a great or poor customer experience.

Ultimately, business owners want to focus on the former and not the latter. So, how do these merchants ensure that they create such an experience and replicate the point of sale process to achieve this goal? Moreover, how do they simplify their checkout while automating important accounting and sales processes?

The answer lies in offering integrated payments. This article explores what these integrated payments solutions are and the multiple ways in which they can help your business and customers. Let’s take a closer look.

What are integrated payments?

Whether online or in-person, an integrated payment is a payment solution that is used when payment is made by a customer to a business for a product or service. This payment is integrated or “speaks to” the merchant’s payment processor and other systems/software through uninterrupted communication.

It avoids manual data entry, among a number of other benefits covered in more detail below. Ultimately, an integrated payment solution simplifies the customer’s payment process and reduces the chances for human error through automation. 

How do integrated payment systems work?

In order to understand how integrated payment processing works, we’ll look at two fictitious examples of sales. One is at the point of sale system and the other is an online transaction.

At the point of sale

At your coffee shop, your customer Fred would like to pay for a cup of coffee that costs £3. They would like to pay with a debit card. 

Fred approaches your payment terminal and taps his card on your device. The transaction is processed and the payment is approved. Your inventory system automatically picks up the transaction, merging with your accounting software and your inventory software. 

This will immediately signal to your bookkeeper that you’ve made a sale, while your supply chain management will be able to monitor the quantity of coffee supplies left over and decide whether to order more.

Online payment processing

In an online payment scenario, your customer visits your online store. They’d like to purchase headphones from you at a cost of £30. They add the item to their card and proceed to checkout. 

However, instead of being taken to a third-party website where they may be required to perform a manual input of their payment data, your integrated payments platform keeps the customer on the checkout page where they can complete the transaction. 

Once the transaction is complete, your integrated system will automatically signal to your accounting system that you’ve made a sale and record it there. Meanwhile, your inventory system or other software will also be updated, letting you know that your inventory contains one item less after the sale.

Integrated payment processing vs. non-integrated payments

Integrated payment systems differ in many ways from non-integrated payment processing. The latter refers to cases where a merchant’s payment processor does not communicate with your point of sale system or other payment-related software. As such, transaction data is not automatically in sync with your existing software.

For in-person payments, this means you’ll have to work on manually entering customers’ sales data and you also won’t be able to automatically record and reconcile your reporting, inventory and accounting software. For online transactions, your customers will be taken to third-party apps or websites to complete the payment.

In addition to non integrated payments, other alternatives to an integrated payment system include:

• Manual processes for accepting payments: These can be time consuming and prone to error. They can also cause customers frustration with the delays and additional steps that need to be completed.
• Hosted payment gateways or online or ecommerce businesses: When using these, customers are taken to a different page that requires input of their payment information. Through this method, customers often abandon their carts due to a disrupted user experience.
• Standalone payment processing software focuses on merchants, who have to switch between a myriad of apps for every payment. This is not only time-consuming but can lead to data discrepancies.

Benefits of using integrated payments solutions

Integrated payments and collections are a valuable tool for business owners who want to introduce efficiencies in and optimise their processes. However, customers also benefit from a faster and more convenient checkout process that gives them greater confidence in the safety of the transaction. 

Let’s explore some of these advantages in more detail below.

Benefits for businesses

Some of the benefits of integrated payments for businesses include the following:

• Enhanced security: An integrated solution for payments acceptance works with trusted payment gateways to enhance customer safety and security in online payments. Risks of data breaches or fraud are reduced this way.
• Greater efficiency: Integrated payment solutions, which are recorded automatically, create a faster and more efficient checkout process for merchants and consumers alike, eliminating time consuming manual work.
• Higher revenue: One of the greatest benefits of using integrated payments software is reduced cart abandonment rate, leading to more sales and complete transactions for online merchants.
• Improved data management: A payment integration solution also gives merchants automatic access into their business’ valuable data, in real time, by considering factors such as inventory, cash flow, customer behaviour and more.

Last but not least, the right integrated payment gateway for your online store means seamless and more secure payment acceptance.

Benefits for customers

Here is how customers benefit from integrated payment solutions:

• Convenience: A business’ integrated payments solution can provide significant advantages for customers, including greater levels of convenience when shopping online. They no longer have to navigate away from the merchant’s site and can complete the checkout in one secure location.
• Flexibility: The number of payment types that integrated payments offer are numerous and include credit and debit card payments and digital wallets, such as Google Pay, etc.
• Security: Merchants that process payments can enhance the customer experience by offering them a secure way to shop online and enjoy reduced risk associated with potential data breaches.

How to successfully adopt integrated payment processing

In order to successfully adopt an integrated payments process that enables your business to accept all types of payments, such as ACH payments and more, it’s essential to consider some factors when making the decision.

Here is a brief step-by-step guide on how to approach this:

1. Analyse your business-specific needs. For example, does your business operate only with a card machine in store through a point of sale system or do you also accept online payments?
2. Explore different merchant services solutions and discover what their offerings are.
3. Carefully study the pricing structure of your list of providers and dig deep to discover if there are any hidden fees in their offering.
4. Consider payment services providers that offer instant settlement of funds when you accept a payment from your customers.
5. Study every provider’s support offering. Ask whether they offer expert support with integration and set up and ongoing support for the duration of your contract with them.

Other perks to consider include whether your provider can offer you a free merchant business card and a free merchant account that you can access from the comfort of your PC or smart mobile device.

Conclusion

In the vast space of in-person and online payment acceptance, it’s essential to choose a payment solution that integrates with your existing software, such as accounting and inventory. This is how your business can become a streamlined and lean operation that works for you. 

Choosing an integrated payments service provider may seem like a difficult task. However, armed with the right knowledge, you can choose a partner that helps your business grow.

Frequently Asked Questions

What types of payments can you accept with an integrated payment system?

There’s a wide variety of payments you can accept with an integrated payment system, including ACH payments, digital wallets, credit and debit cards, bank transfers, etc.

What are the typical pricing structures of integrated payment service providers?

In the integrated service provider industry, most providers offer an interchange plus, a flat fee or tiered pricing. Make sure you check for any hidden fees that could add up over time.

How quickly can funds be settled into your merchant account once a payment has been made?

With myPOS, your integrated payments can be transferred to your merchant account instantly. Other providers may take several business days to do this.