Over the last few years, consumers have increasingly demanded more seamless financial interactions, shifting more and more towards digital payments and online banking solutions. Recent data shows that 78% of Americans prefer to bank digitally, a number that’s only likely to increase as younger generations come of age. As such, companies have ample reason to invest in embedded payment. Expanding into embedded payments and embedded finance can be a way forward for software-as-a-service (SaaS) startups and independent software vendors (ISVs) to withstand the pressures of uncertain economic conditions.
What Are Embedded Payments?
Embedded payments allow consumers to make financial transactions anytime and anywhere through connected devices, including digital wallets, wearable technology, cars, appliances, and even the metaverse. Software companies have increasingly recognized that their customers’ payment needs haven’t been met by the payment providers they partner with. In response, many have become payment facilitators themselves, embedding payments directly into their own software products to create a seamless and cohesive experience for customers.
Since embedded payment systems are a natural function of the app or system being used, it is generally much more convenient for customers, benefiting from increased speed and convenience. It also allows software providers to deepen their relationships with customers and merchants. With experts predicting that the embedded finance market will be valued at more than $138 billion by 2026, the field is set to experience significant growth in the next few years.
What Are The Benefits of Embedded Payments?
Along with consumers’ growing preference for digital payment solutions, there are a number of reasons that ISVs should consider expanding into embedded payments. It offers both consumers and businesses a variety of benefits in terms of convenience, simplicity, and quality.
Here are five reasons why embedded payments are beneficial to consumers and businesses alike.
- Superior Customer Experience
Consumers have high expectations for service, so brands cannot afford to offer a subpar user experience (UX). Multi-step payments spread out across multiple channels can quickly become tedious, especially when those channels aren’t fully cooperating. Integrated payment solutions circumvent these issues by providing a seamless UX, ensuring that customers can checkout, enter their payment information, and complete their purchases on the same page.
- Improved Security for End Users
With cybercrime becoming an increasingly common problem, cybersecurity is a concern for everyone. Any time a customer is redirected to a third-party processor, there’s a chance that their sensitive financial information could be at risk. By using embedded payment solutions and investing in stronger security measures, ISVs can ensure that consumer data is safe. This also helps boost customer confidence and loyalty, as people are more likely to stick with a brand they can trust.
- Convenient For Merchants
Multi-step payments aren’t just frustrating for customers, but they’re an inconvenience for merchants as well. If a merchant is handling their accounting manually, an integrated payment solution could offer significant improvements, as they can get paid quicker, while also automating payment record entry, saving time and labor. Integrated payment options are also generally easier to understand, making onboarding merchants easier as well.
- More Efficient Troubleshooting
No matter how well you plan ahead, a payment service will run into problems at some point. However, having multiple third-party providers to support various aspects of your payments can complicate matters even further, leading to frustrating wait times. By partnering with a payments provider that offers all the tools you need in one solution, you can easily identify problems and quickly solve issues, all without the added friction of working with multiple outside vendors.
- Generate Additional Revenues
Software companies face a lot of competition, so they need any advantages they can get to stand out from the crowd. By adding functionality around payments, ISVs can generate additional revenue streams while developing offerings that differentiate them from their competitors. This includes the potential for premium features that can drive up customer interest.
Why Should You Consider Amaryllis?
There are a broad range of benefits associated with embedded payments, which makes it the best option for consumers, merchants, and ISVs. But who should you turn to if you’re looking to implement embedded finance services? Amaryllis offers a simplified yet robust technology stack that allows SaaS companies to create new revenue streams with a deeper suite of financial services. With our help, ISVs can implement high-quality embedded payments solutions without having to build a payment platform from scratch.
Four big reasons to work with us:
- Recession Proof Your Business
With the economy in a rough spot and inflation at historically high levels, companies need to expand their revenue streams. By adding new revenue streams, ISVs can multiply current revenues by 2-5 times within 18 months.
- Low Costs of Acquisition (CAC)
Setting up a payment platform from the ground up is expensive and time-consuming. With Amaryllis, we offer the benefits of a professionally developed embedded payment platform without the time and money investment.
- Boost Customer Retention
Consumers want fast, convenient, and seamless, so the platforms that can deliver stand to benefit the most. When your customers are happy with the experience that you provide, they’re more likely to keep using your services.
- Increase Valuation
Embedded payment solutions through Amaryllis offer several avenues for increased valuation through increased Lifetime Value (LTV), Customer Acquisition Cost (CAC), and Churn. We have seen large managed payment facilitators increase their LTV by 56 times!
Embedded payments are vital for ISVs and SaaS startups to withstand the mounting economic pressures and deliver the best possible experience for their customers. Amaryllis and our all-in-one payment facilitation platform can deliver that experience!