Integrated Payment Processing: Everything You Need to Know

As a merchant, you have two main options for credit card payments: integrated payment processing or third-party payment processing.

What are the key differences? Essentially, integrated payment processing is done by your POS system provider. They create your POS software, as well as manage payment processing.

There are many benefits to using integrated payments, rather than a third party. For example, POS payment integration can help improve the customer experience, increase efficiency, and ensure smooth and effortless transactions.

You might be wondering: How do integrated payments work? What are the differences between third-party payment processing? And why should businesses consider an integrated platform? This guide covers that and offers a comprehensive picture of integrated payment processing in retail.

What Is Integrated Payment Processing?

Integrated payments refers to a POS system that is also a payment processing. In the past, businesses needed a POS system, but a third-party processed payments with standalone terminal. Now, many POS providers also offer payment processing services, e.g. they’re “integrated” in the system.

Therefore, to start accepting credit card payments, a retailer doesn’t need any third-party hardware or card readers. The credit card system is integrated in the POS.

Ultimately, integrated processing enables smooth and effortless transactions. What sets it apart is the convenience it provides to customers by allowing them to use various payment methods, such as credit and debit cards. This solution eliminates the inconvenience of manual processing or the need for separate terminals, resulting in a fast and efficient checkout experience for both businesses and their customers.

Key Benefits of Integrated Payments

As mentioned before, POS payment integration provides easy and seamless transactions, boosts efficiency, and enhances the customer experience.

Integrated payments provide the following benefits:

1. Save money

By integrating payments into your business, you can achieve significant long-term savings. This allows you to bypass the laborious and time-consuming tasks of manually inputting and reviewing transaction data as account processes become automated. Many POS payment processors offer best rates, as well as potentially discounts on hardware and software fees.

2. Fewer accounting mistakes

Integrated payments make accounting processes easier. This allows the received payments to be automatically routed for accounting. This reduces the need for reconciliation, and syncing data between your POS and a third-party platform.

3. Stronger security

An integrated payment solution better protects customers’ sensitive information. This is because there are fewer data sources and routing issues. By opting for this solution, businesses can minimize the chances of data breaches and fraudulent activities.

4. Diminish fraud

Merchants can identify potential fraud by analyzing trends and patterns in sales through integrated payments solutions. Digital payments provide a high level of security and protection against fraudulent transactions, thanks to their utilization of secure and encrypted channels.

5. Real-time data

Integrated payments offer businesses the benefit of real-time transaction monitoring. This streamlines accounting processes and ensures greater accuracy. Furthermore, it provides instant access to valuable transaction data and insights, offering pivotal information for a business’s daily operations.

6. Marketing integration

Thanks to an integrated payment solution, businesses can easily access and analyze customer spending habits in real-time. This provides faster and more reliable data, allowing businesses to effectively sort customers based on their purchasing behavior.

By inputting this information into your POS CRM software, businesses gain valuable insights into which products are successful and which ones are not. With this information, businesses can optimize their marketing strategy, promoting successful products and discontinuing underperforming ones, leading to long-term success.

7. Better relationship with payment processor

With an integrated payment processing solution, you have better access to support staff. That’s because you already have an existing relationship with your POS provider. An established relationship can also help eliminate high-risk credit card fees, for example. Your POS provider knows your business, and that you operate legitimately. Therefore, they’re less likely to see you as a risk.

How Integrated Payments Benefit Customers

Integrated payments offer numerous benefits, one of which is significantly boosting customer satisfaction. Some of the key benefits include:

More payment options

With the majority of integrated credit card processing solutions, customers have the flexibility to choose from a range of payment options. These options include credit or debit cards, gift cards, and digital wallets like Venmo, PayPal, or Google Pay.

More convenience

Lack of integrated payments can lead to frustrating checkout experiences, abandoned carts, and dissatisfied customers. However, by implementing an integrated payments solution, businesses can streamline the process, increase speed, and enhance security. Additionally, customers can conveniently make purchases directly through the business’s website or mobile app, eliminating the need for separate payment portals.

Payment processing on a recurring basis

Having an integrated payment processor for your business subscriptions not only simplifies billing but also enhances efficiency when it is connected to the merchant’s CRM software. By requiring customers to provide their payment information only once, the system can securely store and automate future invoicing and ongoing payments.

Stronger security

Integrated payments solutions keep customers’ confidential information protected within the business’s secure systems. This includes credit card information, routing numbers, and personal details. Instead of sending this sensitive data to an external payment gateway, the business processes it internally.

Integrated Payment Processing vs Third-Party Payments Processing

Here’s a closer look at how an integrated merchant services account compared to third-party processors:

Integrated payment processing

An integrated payments solution connects a payment processor to a POS system for streamlined payment processing and transaction completion. This eliminates the need for manual processing and separate terminals, resulting in a faster checkout process for both merchants and customers.

This type of solution offers features such as storing customers’ personal information and tracking sales data. With integrated ecommerce applications, customers can conveniently make payments without being redirected to external websites or apps.

Pros: 

• Faster checkout times
• No need for data syncing and reconciling
• Better customer data tracking and payment profiles
• Reduced costs on hardware and potential savings on processing fees

Third-party payment processing

In contrast, non-integrated payment processing lacks communication between the payment processor and the point of sale. This means that transaction data is not captured automatically during a sale, necessitating entry of customer payment information into a separate payment terminal. Additionally, without integration with the POS system, businesses cannot access reporting and inventory data automatically.

Pros: 

• Many established options (better recognition with customers)
• Ease of accepting credit cards

However, there are cons, including the risk of reconciliation errors, a lack of real-time data, and a slower checkout process.

Integrated Payments in FTx POS

Discover the benefits of integrated credit processing with FTx Card Payments and unlock potential cost savings on your current processor. By utilizing Datacap NETePay alongside your existing processor and processing hardware, you can seamlessly incorporate this solution into your payment system. It is essential to emphasize that successful integration requires collaboration from your current processor to connect with Datacap NETePay. The ability to select the processor that best aligns with your company’s unique requirements guarantees a personalized and streamlined credit processing experience.

Other benefits of FTx Payments include:

• Enhanced reporting and inventory management across multiple stores
• Automated retail upselling
• The option to initiate online transactions and finish them in-store to prevent higher interchange fees for cards that are not present and to activate chargeback protections
• Roll out dual pricing and cash discounting

To get started with FTx Card Payments, be sure to get in touch with us today to schedule a consultation and check out a demo!