How payment facilitators will continue to disrupt the acquiring market in 2018

March 8, 2018


Square, Stripe, and PayPal have become the poster children for the new acquiring era of payment facilitation. Less than ten years ago, these technology-focused disruptors entered the market with a fiercely underestimated growth potential. After all, how could offering product solutions built for micro-merchants make a significant dent in the mammoth portfolios of traditional acquiring banks?

A decade later Square made almost $50 billion in gross payment volume. If Square were an acquirer, this would make it the 9th largest in the United States after top players Chase, Bank of America, and Vantiv/WorldPay.1 As the payment facilitation model is sweeping the globe, traditional merchant acquirers are worried about their own future and scrambling to come up with new technology and new distribution packages. Research by the Double Diamond Group suggests that even when removing the “big three” – Square, Stripe, and PayPal – the payment facilitator market could grow to over $500bn in gross processing volume within the next five years.2

Merchant Acquirers 2015

As for the traditional ISO, their future is dead. An increasing number of traditional independent sales organizations (ISOs) are looking to find ways to become a payment facilitator, or at least become more payfac-like. The ISO we know today will soon be no more, as they start to transform into ISVs, payfacs, or a new kind of hybrid. One study estimated that there are about 10,500 B2B SaaS companies in the United States alone that could operate as payment facilitators, given the right tools.3 ISOs should be striving to get ahead of these tech companies and employ these tools before they do.

In a recent article Peter Fitzpatrick, Director of Market Development at Agreement Express, covers:

  • The components of a payment facilitator that matter, and that other payment service providers should consider adopting
  • How to remain competitive against payment facilitators

Read the full article here.

Payment facilitators are a growing force to be reckoned with, and are pushing technology use into the acquiring market faster than anticipated. The traditional ISO will soon die, but only to make way for a newly digital ISO, employing key components of payment facilitation to their advantage.

To learn more about how your organization can remain competitive, read The ISO’s Guide to PayFac-like Customer Experience. This eBook covers how to improve merchant experience, how to decide whether to build or buy a solution, and a checklist to help you assess vendors.


  1. Gross payment volume (GPV) of Square Inc. from 2012 to 2016 in US$bn – Statista, January 2018
  2. The World’s Top Card Issuers and Merchant Acquirers: 8th edition.” The Nilson Report, May 2016
  3. Oglesby, Rick. “Why Software Vendors Should be Payment Facilitators: Don’t miss out on this revenue opportunity.” Double Diamond Payments Research, LLC. 20 October 2016