What is a payment processing company Company (PSP)? How to choose a PSP that will drive business growth

In recent years, with the expansion of the e-commerce market, online payment has become an integral part of business success. However, don't you think that payment processing company companies that provide online payment method are "infrastructure providers that take care of the paperwork and systems on your behalf"?

Today, payment is seen as more than just infrastructure, but an important foundation for growing sales, improving user experience, and even expanding your business. Overseas, it is common to call these businesses "PSP (Payment Service Provider: payment Service Providers", but in Japan, businesses that play a similar role have been called "payment processing company companies".
In this article, we will explain the latest overseas trends, current required functions, and how to choose them, based on the basic mechanism and role of .

It's not just about cost savings, it's a step towards finding the best payment strategy for enhanced security, improved user experience, and future business expansion.

What is a payment processing company Company (PSP)? How it works and what it does

A payment processing company company (PSP) is a business that stands between multiple payment companies, such as e-commerce and credit card companies, CVS Payment, and carrier payment, and centrally handles payment procedures.

The process for an end user to purchase a product and perform a payment on an e-commerce site is as follows.

1. End users: Select payment method on your e-commerce site and enter payment data.

2. E-commerce Operators: Send the payment data received from users to the payment processing company Company (PSP).​

3. payment processing company companies (PSPs) and paymentcompanies: Use the information received from the e-commerce business to communicate with each payment company (e.g., credit card company) selected by the end user to obtain payment authorization.

4. payment processing company Company (PSP): Deposits from each payment service company are combined and deposited to the e-commerce business in the form of fees and other fees.

This mechanism allows e-commerce businesses to introduce a variety of payment method without the hassle of contract and system linkage with individual payment companies.

Why do you need a payment processing company company (PSP)? How is it different from direct contract?

Instead of using a payment processing company company (PSP), e-commerce operators can also "contract directly" with individual payment companies. However, when it comes to growing your business, direct contract comes with challenges, including:

payment processing company companies (PSPs) are a strong choice for many e-commerce companies to deploy diverse payment method, reduce development and operation costs, streamline accounting operations, and solve advanced security measures all at once.

payment processing company The role of companies (PSPs) is expanding

The term "payment processing company company" may give the impression that it is a company that handles procedures and processing related to payment on your behalf. Today, however, payment processing company companies (PSPs) are more than just responsible for payment processing, they have a broad role in supporting the company's business operations.

Overseas, these businesses are commonly referred to as "Payment Service Providers (PSPs)." On the other hand, in Japan, the term "payment processing company company" has become established, but in recent years, the scope of its offerings has expanded, and its character as a payment foundation that supports the business growth of client companies has become stronger.

1. global expansion support: Supporting cross-border e-commerce through multi-currency payment and regional payment method
2. Data analysis and utilization: Provide a mechanism that can be used to analyze transaction data and improve customer loyalty and detect fraud.
3. Provision of Peripheral Finance Services: Provision of remittance, billing, and financing support (finance services such as loans and corporate cards) based on payment
4. Improved user experience: Helps improve completion rates with smooth payment screens and rich payment method
5. Security Enhancements: PCI DSS and EMV 3-D Secure Support, Fraud Detection

In this way, today's payment processing company companies (PSPs) are more than just "agency" and are now supporting sales expansion, operational efficiency, and risk reduction. payment is no longer just the infrastructure behind the scenes, but is positioned as the "growth strategy engine" to take the business to the next stage.

The Role of payment processing company Companies (PSPs) in the Japanese Market

In the e-commerce market in Japan, there is still a lot of emphasis on price comparison when choosing a payment processing company company (PSP). But as business scale expands, fees aren't the only thing to focus on.

For example, whether it can handle abundant payment method, maintain a stable utilization rate, respond to fraud measures and security requirements, and flexibly respond to future omnichannel and BtoB deployments is directly related to business continuity and growth.

In this sense, today's payment processing company companies (PSPs) need to be more than just a provider of payment processing, but a partner that supports the company's growth.

GMO Payment Gateway (GMO-PG) is one of these payment processing company companies (PSPs) that support our customers' business growth in multiple ways.

There are three values that we believe payment processing company companies (PSPs) need for GMO-PG:

1. Improved payment experience (PX): Prevent end users from "abandoning the cart" and improve purchase completion rates with a robust payment system that provides rich payment method to cover users' payment needs, smooth payment screens, and high uptime.
2. Highest level of security: Protect your company's trust and assets by implementing technology to protect your company's trust and as well as PCI DSS compliance.
3. Supporting the growth of your business: In addition to payment functions, we will expand the scope of our offerings as the company expands, such as attracting customers to e-commerce sites, supporting UX improvement, and providing brick-and-mortar stores and BtoB payment.

Especially in the enterprise domain, rather than a small difference in fees, the comprehensive capabilities of "unstoppable payment network", "support system in case of trouble", and "future scalability" are directly related to business continuity and growth. A true payment processing company company (PSP) is a "partner" who not only supports infrastructure of payments, but also drives the growth of the business together through these elements.

payment processing company 5 Benefits of Using a Company (PSP)

1. Significant reduction in development and operation costs

By using a payment processing company company (PSP), e-commerce operators can significantly reduce the initial development cost of system integration with each payment company and the maintenance cost after operation. With a single integration with a unified interface provided by a payment processing company company (PSP), multiple payment method can be deployed at once, allowing resources to focus on their core business.

2. contract ・Improving operational efficiency by centralizing accounting operations

payment processing company companies (PSPs) can unify contract points of contact with payment companies and payout management, dramatically improving the efficiency of back-office operations. Simplified payout cycles make it easier to stay on top of your finances and allow you to focus on your core business.

3. Meet the latest security requirements (PCI DSS, EMV 3-D secure, fraud detection tools)

Security is an important and specialized issue when dealing with online payment. By using a payment processing company company (PSP), e-commerce operators can significantly reduce the obligation to comply with PCI DSS (International Standard for Credit Card Information Protection) and the burden of dealing with fraud measures that are becoming more stringent every year. You can operate your payment with peace of mind knowing that your payment processing company company (PSP) maintains security standards at all times.

4. Prevent "abandoned carts" and increase sales with abundant payment method

"Abandoned cart" in which users give up purchasing because they do not have the payment method they want, is a major opportunity loss for e-commerce operators. payment processing company companies (PSPs) cater to the needs of all users and contribute to increasing sales by providing a variety of payment method, including credit cards, CVS Payment, Bank transfer, carrier payment, buy now pay later, and multi-currency payment.

5. Flexible response to future business expansion (omnichannel, BtoB development, etc.)

As the e-commerce business grows, payment needs change. payment processing company companies (PSPs) offer highly scalable services for the future of their operations, including online payment, brick-and-mortar Card Present Transactions (omnichannel), BtoB payment, payment and fund transfers (Remittance Service between businesses and end users).

Don't fail! How to choose the best payment processing company company (PSP) for your company and comparison points

Supported payment method Richness and Trend Adaptability

Don't just have "a lot" of payment method, make sure you can respond quickly to new end-user trends (buy now pay later payment, diverse QR code payment, etc.) and make sure you have the payment method your target audience needs.

It is also important to note that the payment processing company company (PSP) regularly conducts market research and publishes trend data.

A lineup of services to solve problems and support growth for e-commerce businesses

The value provided by payment processing company companies (PSPs) is not limited to infrastructure of payments. We provide diversified services based on payment to meet the growth phase and challenges faced by companies to support business expansion.

The lineup of problem solving and growth support services provided by GMO-PG includes the following.

Flexibility in connection methods (API, linked, etc.)

payment processing company The best connection method for a company (PSP) depends on the system configuration and development resources of the site. It is important to check whether there are flexible options that suit your company's development system and the level of customization you want. payment

Security measures and system availability

payment System shutdown means immediate loss of sales opportunities. The high availability and stability of the system should be prioritized over low cost, so be sure to check it.

Also, in terms of security, make sure that the fraud detection service is in place.

Support system in case of problems after introduction

payment is running 24 hours a day, 365 days a year. A support system for system issues and emergency inquiries is crucial. Especially in the case of overseas PSPs, there are cases where Japanese support is limited or the response time is based on overseas standards. The availability of prompt support from technically specialized staff is a major differentiator in operations.

Initial cost, monthly cost, payment fee concept

If you only pursue low fees, security measures and support will be neglected, which can actually cause significant losses to your business. It's wise to judge by the total cost of ownership, including the aforementioned security measures, support systems, and scalability.

payment processing company Requirements for Enterprises and GMO-PG Initiatives

GMO-PG boasts a wide range of Actual in the enterprise field, including major Japanese e-commerce operators and highly public services. It's a testament to the reliability of not only providing payment functionality but also meeting the stringent security requirements of enterprises, complex system integrations, and the stability and scalability to withstand business growth.

Its strength is that it can handle all business sizes, from fast-growing startups to large enterprises.

Comprehensive support that runs parallel to business growth

payment processing company As a company and PSP, GMO-PG values comprehensive support capabilities that "run along" to business growth.

1. Generous support from dedicated personnel: From consulting on system integration at the time of implementation to accounting and troubleshooting after the start of operation, dedicated personnel in Japan provide consistent support.
   
   

2. Flexible Customization: We can offer flexible customization proposals for industry-specific payment needs or individual requirements, such as incorporation into large-scale systems.
   
   

3. Stay up-to-date and responsive: payment Respond quickly to the latest industry trends and revised laws and regulations, providing a safe environment for customers to continue doing business.

Conclusion

In this article, we explained how a payment processing company company (PSP) works, its role, and how to choose one.

Today, payment processing company companies (PSPs) are expanding their role beyond just acting as an agent for payment processing, but also supporting the company's business growth through rich payment method, security measures, data utilization, and integration with peripheral services.

payment is over, and the era of judging by low fees alone is over, and the combined strength of "security", "scalability", and "support" is an important key to business growth. If you're looking for robust infrastructure of payments and generous support, especially in the enterprise space, choosing a payment processing company company (PSP) with a domestic Actual and comprehensive strength can be a shortcut to stable business operations and growth.