Why Your ISO/ISV Isn’t Satisfying Merchants and How to Fix It
December 30, 2021
As an ISO or ISV, your role inherently involves merchants. Therefore, the merchant experience is an integral part of the success of your business. While ISOs and ISVs are not the same thing and do not perform the same duties, a key part to achieving success for both kinds of entities involves a quick, satisfying merchant onboarding and underwriting process.
That said, roadblocks are a commonality in every business model and in the points below, we further explore the main issues that prevent ISOs and ISVs from beating their competitors in providing the best quality service to their customers. For ISOs, that involves delivering top-notch merchant services and for ISVs, it includes selling the best merchant software.
In the end, if these roadblocks and pain points faced by both ISOs and ISVs are not addressed, increasing revenue and enhancing business processes become harder to achieve as these entities struggle to stay afloat with their current broken processes and systems.
In this blog, we discuss these roadblocks as well as detail a simple solution to all of these pain points that boosts merchant satisfaction and profit for both ISOs and ISVs.
The Role of an ISO
ISOs, or independent sales organizations, are third-party payment processing companies that handle merchant accounts for businesses that deal with merchants.
ISOs have relationships with acquiring member banks that allow them to provide ISO merchant services to their customers. These ISO merchant services consist of handling the day-to-day activities of a merchant account for a business.
The Role of an ISV
These companies can develop, market, and/or sell software solutions that streamline merchant experiences through tools like data automation, informational organization, and procedural insight dashboards.
Onboarding and Underwriting: The Keys to Keeping Business Booming
However, it is not all merchant fun-and-games for ISOs until a merchant has been underwritten and onboarded; two processes that typically are the hardest for ISOs to perform in a timely and risk-free manner.
The fact of the matter is that merchants will not seek out ISO merchant services if the process of underwriting is slow.
In fact, 70% of merchant abandonments are a result of slow and inefficient underwriting processes.
Similarly, ISVs should be marketing and selling software solutions that help rid underwriting and onboarding of the roadblocks it can suffer from when a company uses inefficient software (or no software at all).
How to Take the First Step in Digitizing Your Company’s Processes
Whether you’re an ISV or an ISO, examine your company with a scrutinizing lens to try and identify any of these inefficiencies that might be causing dissatisfaction with your merchant software or in your merchant experience, and seek to remedy them. Below we outline the most common pain points ISOs and ISVs face when trying to keep up with the ever-evolving payments industry.
Points of Inefficiencies that You Should Stomp Out with Software
- Manually Entering Data
Data entry by hand often leads to typos; not to mention, it is a huge time suck. Many software solutions require manual entry only once and then generate that data throughout other documents automatically. This saves companies a lot of time in the underwriting process, which typically is data-entry heavy.
- Using Spreadsheets
Although beholden to many companies, spreadsheets are incredibly susceptible to mistakes and are difficult to edit. They have quickly become an outdated method of data representation. Instead, many software solutions keep track of data in a database, allowing individuals quick access to important information for a quick and accurate underwriting process.
- Relying on Shared Drives
Hosting information on a shared drive can become messy and confusing, and lead to data breaches and increased risk because of the lack of security.
Many underwriting software solutions have strong security systems built into their infrastructure, meaning extra protection for the sensitive information involved in underwriting. Furthermore, software solutions built specifically for underwriting have tools that keep data organized, with the additional perk of being able to send documents inter-departmentally for a quicker overall process.
- Creating Long Email Chains
Email chains are inefficient mazes that are bound and determined to result in wasted time spent searching for documents. With underwriting software, underwriters can send messages straight off of a platform and keep track of all the attachments, replies, and document submission, resulting in a quicker overall process.
- Utilizing Subjective Decision-Making
This simultaneously characterizes one of the biggest problems in modern merchant underwriting, and one of the biggest ways software can help smooth out the bumps in the underwriting process. Digital tools often have analytics running in the background, calculating how risky a merchant is based on data aggregation and paradigms that the human eye alone cannot discern. Combined with the knowledge of an underwriter, this feature of many software programs proves advantageous for avoiding risky merchants.
- Managing Multiple Software Programs
Working with multiple software programs that all play different parts in the underwriting process just leads to inefficiencies, errors, and confusion. Potential merchant clients will have a difficult time figuring out how to submit their applications, and it makes it difficult for underwriters to keep track of documents and information. A software program that instead handles all aspects of underwriting is more organized and more efficient because of it.
Automated Software: The Way to Give Merchants an A+ Experience Every Time
One of the biggest issues that arise out of any and all of these roadblocks is the lack of compliance that comes with being less confident in your data and risk analyses in the underwriting process.
Stop going with your gut on underwriting decisions and make approvals or denials with data-backed confidence. Agreement Express’s automated risk scorecards help businesses decide whether or not a merchant is risky, and our onboarding and underwriting software provides a smooth merchant application process that reduces abandonment and boosts satisfaction.
Ultimately, the bottom line is if you aren’t digitizing your onboarding and underwriting processes with automation software, you’re not giving your merchants the best experience on the market, and this increases your vulnerability to your competitors. And this lack of a satisfactory experience means a loss in revenue.
ISO vs Merchant Acquirer: What’s the Difference?
Some ISOs call themselves a merchant acquirer, because an ISO is a type of merchant acquirer. Merchant acquirers are the financial institutions that help to allow merchants to accept payments.
What Does ISO Mean in ISO Merchant Services?
ISO stands for Independent Sales Organization, and they provide merchant services for companies that deal with merchants in the payments space.