CX Craze: Merchant Experience is the New Customer Experience

Customer experience, or as it’s more commonly known these days, “CX”, has been a hot payments trend for the last couple of years.

Major banks, acquirers, card providers, and other payments organizations are scrambling to cater to the end-consumer - the customer who will actually be paying the merchant. Questions about how to offer more seamless, instant, and even “invisible” payment solutions like Uber are swirling through publications, conferences, and board rooms.

Research and data have been gathered to prove how consumers will spend more when they have a convenient, fast experience. From chip-in, to contactless, to cashless, the penetration of mobile has shaped customer expectations worldwide. At the same time, news of breaches and hacks have increased the consumer concern to have a safe transaction in which they can be sure their information is secure.

But while apps like Apple Pay have changed the consumer experience, apps like Square have changed the merchant experience. While Airbnb hires Payments Customer Experience Managers, payments companies continue to quietly hire Merchant Experience Managers.

Focus on the merchant, not just the consumer

Many payment service providers say they “put their merchants first”, or “offer great merchant services”, but not many talk about offering a secure and convenient merchant experience.

If the mobile world has disrupted payments for consumers, it has for merchants too. If consumers expect increased security and convenience, so do merchants. If security and speed makes customers spend more, the same applies to merchants. So why aren’t we talking about MX? What about the merchant experience? They are your customer, not your customer’s customer.

E-commerce and mobile-commerce have changed the global market and increased the need for small payments with small merchants, which only continues to grow. How can an ISO or traditional acquirer afford to cater to each of these small merchants setting up their own websites and selling their wares?

According to ING, over 25,000 fintech companies worldwide were eating away at the bank’s share of the payments market. And that’s only growing. But that’s no reason to pull your small merchant programs and solely focus on large merchant accounts. If you do, you’ll miss out on a massive, increasing micro-merchant market.

How to remain competitive in today's market


When considering merchant experience, think of any moment they interact with you. Begin with the merchant boarding and underwriting process. While PayFacs and ISVs aim to get merchants boarded in under an hour, most traditional systems take days or weeks today. Streamlining and automating the process can help offer the merchant experience you need at a lower cost.

Think of your priorities:

  • Secure
    Your first priority is to ensure that whatever onboarding and underwriting processes or platforms you use are secure. Not only do you want to conduct the necessary KYC, AML and other risk assessment due diligence in your underwriting, but ensuring your merchant’s data is safe is of paramount importance to your customer.
  • Fast
    Second, just like a consumer, speed is incredibly important to merchants who are busy setting up their businesses. The faster the onboarding and underwriting process, the faster they can be approved and start processing payments. Automated workflows have seen a drop in application NIGO (not in good order) rates from 40% to 1%. Not only does automation free-up your back-office staff to focus on larger accounts, it also increases the volume of merchant accounts you have for a very low cost per lead. This allows you to get into micro-merchant markets that were previously too expensive to service.
  • Open
    Once you have a system in place that is secure and fast, you’ll have the chance to open up APIs and collaborate with other industry leaders in your ecosystem. By working together, let’s say a merchant acquirer and an ISO, you can offer a seamless, end-to-end experience for your merchant, so they won’t be asked the same question twice and they won’t even notice the difference when they switch from one platform to the next. This is best done digitally. A more open relationship with partners can facilitate innovation to advance your business and reap the benefits.

Next, think of the requirements to get there:

  • Change the Attitude
    It’s difficult to keep up with these web- and mobile-minded merchants when you’re stuck in the legacy systems of yesterday. This step is often overlooked when companies embark on “digital transformation” projects. Without a team that’s completely committed to change, you’ll fall back on the old ways of doing things and your innovation will be for naught.
  • Invest
    To improve the merchant experience, you’re going to need a payments framework with an extremely flexible architecture. Changes to the industry and to regulations are occurring as little as every six months. You must be prepared to invest the time, energy, and people resources to make this happen, or partner with an established technology company with industry experience.
  • Collaborate to Innovate
    Whether you’re working with organizations that exist within your payments ecosystem, forging new industry ties, or partnering with a fintech company, collaborating on your new merchant experience project will be easier, more innovative, and better integrated when you work together.

Learn more

To learn more about how automated onboarding and underwriting can deliver a competitive merchant experience, download one of our eBooks, The ISO's Guide to PayFac-like Customer Experience, or The Merchant Acquirer’s Ultimate Guide to Onboarding More Merchants.

Interested in learning about how a partnership with Agreement Express can help you reach maximum merchant experience effectiveness? Book a call. We’re happy to collaborate to innovate.

Buitenhek, Mark (2015, May). “Payments is all about customer experience.” ING. Retrieved from

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