Curious About Integrated Payment Solutions? Here’s What to Look for.
Imagine that you could key-in information once, then automatically use wherever or however else it’s needed, eliminating the possibility of re-entry mistakes. As long as the data is entered correctly from the start, the numbers are always accurate, even across multiple related databases.
That’s the basic idea behind integrated payments.
The integrated payments concept lets you take credit card information obtained during a transaction and forward it to other accounting programs for processing and posting. It sounds great... but does it work? In this post, we look at how an integrated payments system can benefit your business.
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What is an Integrated Payment System?
- Integrated Payments
An integrated payment system is an automated payment processing platform. It takes transaction data from the point of sale, sharing information directly with other connected systems without manual input.
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As an eCommerce merchant, you’ll need a lot of different services in your tech stack. We’re talking payment processing services, an accounting system to track transactions and profitability, an order management system to track inventory and purchases, a customer relationship management (CRM) system to track customers, an online storefront for customers to shop and checkout from… and more.
Traditionally, your payment processor, accounting system, order management system, CRM, and website aren’t integrated; they don’t sync up or talk to each other. This is fine if you’re running a small operation, but it quickly becomes a problem when you serve thousands of customers and need to track tens of thousands of orders.
That’s where integrated payments come in.
It’s a strategy to closely link together all of your information systems. It helps prevent duplicate or out-of-date data, sidestep manual importing and exporting, and ensure that every transaction submitted for processing is seamlessly and accurately reflected in your accounting software, order management system, and CRM.
This is especially relevant to merchants who might otherwise need to manually copy, or even key-in numbers. Payment information comes straight from the online checkout, and is automatically used to process and post payments to the associated transaction or invoice.
What Are the Benefits of an Integrated Payments Model?
The immediate advantage here is streamlined operations. Through integration, payments are posted and ledgers are updated at the time of sale. But, there are a few other long-term benefits to an integrated approach that you should consider, too:
| Non-Integrated | Integrated |
| Multiple Programs & Systems: Standalone systems don’t connect to your POS, meaning you’ll need at least two (and usually more) processing systems. | Everything Together: Integrated payment systems connect directly with your POS and transfer data without needing a third-party processor. |
| Multiple Entry Points: Manually keying in the same information in multiple locations is not only tedious, it increases the odds of a mistyped entry. | One Entry Point: Data received directly from the POS and used consistently by the entire system dramatically lowers the odds of entry mistakes. |
| On-Site Data Storage: There is always the risk of data theft or fraud. If you’re storing personal customer information, you’re responsible for going through all the necessary steps to keep it safe. | Integrated Storage: Integrated payment systems are required to comply with PCI DSS regulations, which are global standards for data security and loss protection. |
Use Cases for Integrated Payments
Integrating your payments system with your other information systems can help you eliminate errors inherent in manual data entry and migration. It also saves you time and hassle.
Take Shopify, for example. Its flagship product is its eCommerce platform, which allows you to build a website, list products for sale, and direct customers to checkout.
Shopify Payments is tightly integrated within the Shopify ecosystem. This is the company’s payment provider, which lets you accept all major credit and debit cards on a one-time or subscription billing basis. It eliminates “the hassle of setting up a third-party payment provider or merchant account and having to enter the credentials into Shopify.”
In the past, an eCommerce store wasn’t so easy to set up. You’d have to sign up for a website hosting service, build a website yourself, design a checkout flow, sign up for a merchant account, obtain API keys, and then manually link the payment gateway to your checkout portal. With an integrated ecosystem like Shopify, all this is already taken care of.
Intuit is also investing heavily in integrated payment technology. QuickBooks, the company’s signature accounting software solution for SMEs, isn’t just a platform for recording, categorizing, and reconciling transactions. Today, QuickBooks is also an integrated payment processing service that lets you accept payments in-store and online. Once payments are captured, and transactions are automatically recorded and categorized in the QuickBooks accounting system; no manual bookkeeping required.
Key Features to Look For With Integrated Payments
Not all integrated payment systems will pair seamlessly with every one of your existing information systems. But, they should all meet certain basic criteria:
PCI Compliance
Tokenization & Encryption
Recurring Billing & Subscription Support
Reporting & Analytics
Multi-Channel Support
Increased security for transactions is important
...but it won’t protect you from all types of payment fraud.
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Challenges & Considerations With Integrated Payments
Integrated payments sound excellent in theory. You get to cut down on manual data wrangling, and all your information systems work together in the background. But, there are some downsides to consider:
Technical Integration Complexity
A fully-integrated payment system is more sophisticated than a standalone payment processing solution. The process of integrating a payment system itself may take many hours of development time, plus deep knowledge of other components of your tech stack. There will also be ongoing troubleshooting requirements even after initial setup.
In any case, it’s not a walk in the park. You should expect integration to take a substantial upfront investment of time and money.
Vendor Lock-In Concerns
You don’t have to integrate a payment system from the ground-up. You can also choose out-of-the-box solutions (e.g. Shopify Payments or QuickBooks Payments) that come pre-integrated with one or more information systems. The difficulty, however, is that you may have a hard time switching away from a vendor if their solutions become so deeply embedded into your operations.
Besides, prepackaged integrated payment systems often feature tighter integrations with certain components of your tech stack and weaker integrations with others. For example, Shopify Payments is most closely linked with Shopify’s eCommerce platform, while QuickBooks Payments is most tightly integrated with the QuickBooks accounting platform.
Data Migration Risks
Chances are, you already have an existing payment processing provider. If you’re looking to switch to an integrated payment system, you’ll need to port over your existing data into your new solution.
This is no trivial task. Data can easily become lost or corrupted during migration, which means you risk losing critical transaction information in the process. Out of an abundance of caution, create a backup of your data before you attempt to migrate anything over.
Costs & Fees
An integrated payment system can be more expensive than a standalone service. That’s natural; an integrated solution is more functional and desirable than a standalone module, and you may find the additional expense to be worth it.
The key here is to find an integrated solution that produces a positive return on investment. Does the time and labor saved exceed the incremental cost of your integrated payment system? If so, go for it. Just make sure that pricing is laid out fairly and transparently so that you can accurately estimate ROI.
Finding the Right Integrated Payment Processing Partner
An integrated payment platform obviously has a lot to offer. So, how do you get started?
Not every payment processing provider can help you integrate your operation. Your first step is to locate the best processing partner for your business. Here are a few things to consider as part of your search:
Does your business need integrated payments? The short answer is “yes.”
Think about the kind of shopping experience you want to offer your customers: fast, easy, and secure. Now, think about the sales experience you want for your operations: streamlined, accurate, and as easy as possible.
Integrated payments can help you accomplish both of these things.
That said, the exact structure of an integrated system is unique to every business. To reap the full advantages of integration, you’ll need to look at all your requirements, from payment options to security and fraud protection. At Chargebacks911, we’re familiar with all the components needed for secure processing. If you’d like help finding your best solution, contact us today.
FAQs
What is an example of an integrated payment?
One example of an integrated payment is an online checkout flow that’s to the merchant’s QuickBooks account. Upon payment, the transaction is automatically entered and categorized within the merchant’s QuickBooks accounting software.
What are the benefits of integrated payments?
Integrated payment solutions save time normally needed for entering and reconciling payments, which reduces your costs and streamlines cash flow. They also lower the potential for errors by eliminating manual data entry. Most importantly, they greatly increase the security of data storage and transmission.
How do you integrate payment services?
Talk to your gateway provider or processor. If they handle integrated payments, they can help you set it up.
What is the difference between integrated and non-integrated payment processing?
Integrated processing is built into the point-of-sale or customer relationship management (CRM) software being used. It does not typically require re-entry of the transaction amount, but rather pulls the amount from the software itself.
Non-integrated processing typically requires a human to manually input the amounts, often in more than one location. This takes time and opens the possibility of errors in recordkeeping and data transmission.
What does payment integration mean?
Payment integration occurs when a merchant’s payment processing system is linked to their customer relationship management (CRM) software, accounting software, order management system, and website. This creates a seamless ecosystem that is secure, but allows for data to be pulled and shared across multiple platforms.
What is an integrated payment system?
An integrated payment system is a payment processing system that is tightly linked to other information systems, including a merchant’s website, order management system, accounting system, and customer relationship management (CRM) system.
What is the difference between integrated and embedded payments?
Integrated payments involves connecting different information systems together, while embedded payments refer to payment processing capabilities that are built into a single system.
