Payment service provider
A payment service provider organizes cashless payment transactions for its customers by integrating the desired payment modules into their store systems. Since customers today place increased value on being able to shop securely online and on having a wide range of payment options to choose from, such services can be implemented easily and cost-effectively via a payment service provider.
High demand for diverse and secure payment methods
In addition to traditional payment methods such as bank transfer, purchase on account or payment by credit card, there are now also numerous payment methods that have been specially developed for the Internet. These include methods such as Paypal, Giropay, but also, for example, payment processing via cell phone. The demand for such methods is increasing because they are very secure and involve few risks. As a rule, there is buyer protection, which guarantees the customer that he will get his money back if goods or services are not delivered as agreed. In addition, many customers prefer not to have to provide their bank or credit card data in every online store. Using methods such as Paypal, the data is registered once with the corresponding payment provider and not transmitted to individual stores.
Third-party billing via payment service providers
Some payment service providers offer the processing of credit card payments as part of third-party billing. In Germany, every merchant offering payment by credit card must have its own credit card acceptance agreement with a credit card provider. In the USA, for example, it is not uncommon to process credit card payments via an Internet payment service provider. In this case, the merchant does not have his own acceptance contract, the payment is handled by the payment service provider and the latter also appears on the credit card statement. Since credit card payment is very popular with customers, such services are readily used, as this significantly reduces the number of aborted order transactions and thus increases sales.
High security for the merchant
Although the use of a payment service provider involves additional costs for the merchant, these usually pay off quickly. The fact that a provider can achieve higher customer loyalty and acceptance if it offers various secure payment methods in its store means that the expenses are quickly recouped with higher sales. In addition, payment service providers also offer the merchant higher security standards, for example through methods of fraud prevention or a collection service that can be used at no extra cost.
