According to data by Statista, the revenue in the software industry is expected to hit $650.70 billion in 2023 and reach a market volume of $812.90 billion by 2027. Because of this, software companies are also coming up in different sectors to help businesses streamline operations such as payment processing.
The shift to digital payments means Independent Software Vendors (ISVs) must invest in the latest payment technologies. If you provide CRM, ERP, project management, accounting, or data management software to different businesses, you need to sell state-of-the-art technologies that align with your clients.
You can capitalize on these profitable opportunities as an ISV by choosing the right payment processing partner. This blog will examine the advantages of partnering with a payment processor, the different available technologies in the market, and case studies of some successful partnerships.
An Overview of the Different Types of Software Companies
The global ISVs market size value was $93.29 million in 2021, and it might expand at a CAGR of 9.69% to hit $162.45 by 2027. As the market grows, software companies also specialize in different areas. Here are some common types of software companies and how they benefit from partnering with payment processors.
- CRM: Customer relationship management (CRM) software companies deal with customer interaction to help improve customer service and increase lead conversion. Partnering with a payment processor provides the tools to access real-time data, which will help you understand your client much better.
- ERP: If your company specializes in enterprise resource planning (ERP) software, your clients can use a single shared database to access all the operational and financial data. A partnership with a payment processor makes it easy to integrate your payment systems.
- Project Management: This software provides insights into how the company resources are being spent. You need to work with a reliable partner to get detailed data-driven analytics during reporting.
- Accounting: Accounting is an integral part of all businesses. You need to use integrated payment technology that works with your accounting software for real-time payment processing.
Advantages of Partnering with a Payment Processor
You should consider a payment processor partnership if your system capabilities are not well advanced to meet your client's needs. Here are the benefits you'll get:
Improved Customer Satisfaction: With the right payment technologies, your ERP or CRM company can provide seamless payment options to your customers, especially if you have recurring payments.
Secure Payment Gateways: All the payments can be securely processed thanks to the security features of the payment processor.
Improved Efficiency: You won’t have to invest in technologies; your payment partner will provide the necessary tools to boost your operations.
How Can Payment Processors Help Software Companies?
Payment processors will come in handy for your CRM or ERP company if you are looking to streamline your payment processing and reduce the risk of fraud. In recent years, fraud cases have increased tremendously, with 703 cyberattack attempts reported weekly in Q4 of 2021.
Because of this, your ISV needs to partner with a PCI-Compliant provider. This level of compliance protects customers' financial data and information during payment processing. Additionally, payment processors use technologies like machine learning to prevent identity fraud.
Case Studies of Successful Partnerships Between Software Companies and Payment Processors
There have been successful partnerships between software companies and payment processors. A good example is the partnership between the Salesforce CRM and PayPal. As one of the top-rated CRM solutions, it has in-built artificial intelligence algorithms and is designed to provide real-time data.
This partnership has been quite successful because PayPal provides a multi-currency platform in the payments industry. Thanks to the integration of these two platforms, online transactions can be recorded on the cloud platform. Salesforce users can use PayPal's Instant Payment Notification which syncs data in real-time, making payment processing much easier.
The other partnership is between Intuit and payment processor, Stripe. Intuit has significantly benefited from working with a payment processor because its users can access robust financial tools such as automated tax calculations, billing and invoicing optimization, and streamlined access to capital.
Future Trends for the Payments Processing Industry
As the world of payments changes, your ISV should adapt to enjoy the benefits. Digital payment trends like contactless payment models, real-time payments, frictionless checkout processes, artificial intelligence, machine learning, and digital currencies are the norm today. Therefore, your software company needs the right tools to future-proof the business.
Payment automation has also become more popular. For your CRM or ERP company to succeed, you must leverage trends such as cloud-based payment systems, mobile wallets, data security tools, and intelligent accounting software. This way, you can provide faster payment systems for your clients, reduce errors, and have cheaper transaction costs.
The Payment Processing Technologies in the Market Today
Here are some payment processing technologies you could use for your software company:
- Hosted Payments: For secure online payments, you need a hosted payment portal that allows you to accept both credit card and ACH payments. If you get this portal from iCG, it can be customized according to your needs.
- IVR Payments: IVR is an easy-to-use payment service that allows customers to make payments via the phone using their touch-tone. This service is ideal for your software company because it reduces the PCI scope of your transactions.
- ACH Processing: Instead of processing paper checks, you can use ACH processing for electric funds transfers.
- Credit Card Processing: You can accept credit card payments for every type of business.
- Email Invoicing: Customers can enjoy convenience by using an email link to pay directly.
- Virtual Terminal: The secure web-based interface allows you to process ACH and credit card transactions through a secure gateway.
ISVs can provide different types of services to their clients. To make payments easier, it's important to partner with a reliable payment processor like iCG. As a Nacha-Preferred Partner, iCG is a one-stop solution that integrates with existing systems. Become a partner today!