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Max FitzgeraldJun-07 20223 min read

Unlocking new payments potential for gateway providers and acquirers

When it comes to innovation in fintech, the customer experience has arguably become one of the primary driving forces. Nowhere is this more apparent than in the payments industry, where security, convenience and speed have gone from being a luxury to an absolute necessity.  

This is reflected in the value propositions now put forward by successful marketplaces, each of them striving to offer seamless transactional processes that both buyers and sellers can place their trust in. Even businesses that haven’t yet been swept up in the trend toward marketplaces are constantly re-evaluating their own e-commerce offerings to include better and more secure payment mechanisms - something that’s as true for B2B as it is B2C as the lines between the two continue to blur.  

Much of this innovation in the payments industry is happening here, in the UK. As of 2020, the UK is the biggest digital payments market in Europe, accounting for £2.3 billion worth of sales. Globally, the transactional value of digital payments exceeds $4.2 trillion, and the market is only just warming up. Disruptive forces like cryptocurrencies, contactless payments and buy-now-pay-later schemes continue to shape customer expectations in the payments industry, and the rapid adoption of software-as-a-service (SaaS) by even the smallest businesses is changing the way they approach payments processing. According to one source, more than a third (37%) of businesses in the UK are planning to invest in new payments technology in the next 12 months.  

It’s thanks to this innovation and disruption that payment gateway providers, as well as merchant banks or acquirers, can now capitalise on seemingly limitless potential.  

 Unlocking marketplace potential 

A lot of marketplaces and e-commerce businesses have mastered the ability to receive funds, but many still lack the agility to quickly and securely process payouts. Some key markets that are bursting with potential are still being held back by payments processes that don’t quite fit the bill. Let’s take the burgeoning luxury resale market as an example. The luxury resale market is growing four times faster than the primary luxury market today, enjoying 12% year-on-year growth, according to data from the Boston Consulting Group. There are many factors driving this surge in popularity, from interest in the circular economy and sustainability to the fact that luxury goods like watches, clothes and classic cars tend to be regarded as rare and timeless. Demand for second-hand luxury goods is exploding, but in order to capitalise, brands and marketplaces need to consider the unique transactional needs of their audience.  

Verification: In any marketplace it’s good for both buyers and sellers to be verified, but this is doubly true for high-value exchanges like those that take place in the luxury resale market. These markets are also likely to attract more high-net-worth individuals who need to be verified to ensure those who may be politically exposed or subject to sanctions are prevented from making or receiving payments. 

Secure holding of funds: Safety and security are key components of a great customer experience. Customers spending high-value sums need to know that their funds will be securely held until the transaction is complete and the item they’re purchasing, whether it’s a luxury watch or a yacht, is as described. Likewise, sellers need to be sure that incoming funds are verified and checked before the sale moves ahead, reducing their exposure to fraud or theft.  

Limitless payout: The luxury resale market deals in high-value goods and services (for example, charter services). Buyers need to be able to guarantee fast, same-day payouts via bank transfer or virtual card without compromising on verification or security checks.  

These are just a few of the unique requirements that buyers and sellers might have when dealing with the exchange of high-value luxury goods or services. They’re also all things that Shieldpay, a PSD2 compliant unique marketplace payment engine, can deliver on. Shieldpay's mission is to help acquirers and gateway providers achieve the secure, frictionless transaction processing experience that buyers and sellers have come to expect. Our platform achieves this by offering real-time verification checks, a robust escrow solution where funds can be held, limitless same-day payouts, as well as automatic compliance with the very latest financial regulatory standards. Shieldpay also embraces full API integration, allowing gateways and acquirers to tailor the platform to their specific needs and the needs of their audience.  

At Shieldpay, we’re all about breaking down barriers, removing limitations when it comes to payments, and ultimately building a new era of trust online. For more information about how our off-the-shelf, fully compliant payment solution can be tailored to your platform, get in touch today.