White label PSP & everything beginners should know about it
Payment service providers (PSPs) are companies that represent the vascular system of online payments. Thanks to their services, people can shop online, make and accept money transfers, subscribe and pay for services, etc., all of which have already become an integral part of our lives. No wonder the PSP market is growing so fast. It is forecasted to more than double from roughly $40 billion in 2019 to a staggering $88 billion in 2027. The numbers speak for themselves, making this market attractive to newcomers and increasingly competitive. A great chance to successfully enter it with minimal investment is considering a white label PSP.
What is a white label PSP?
To flesh out the concept, let’s split the term into two parts: white label and PSP.
- The white label model means buying an unbranded solution from a producer, putting your brand on, and selling it as your own. With this business model, a single product can be marketed by multiple vendors under different brands.
- PSP (payment service provider) is a company you as a merchant choose to process your incoming and/or outgoing online transactions. It is a middleman between a customer, merchant, payment gateway, acquiring and issuing banks.
Altogether, a white label payment service provider is an out-of-the-box solution that allows you to earn money by providing payment services to merchants under your brand.
There are plenty of white label solutions on the market, each with different sets of features and at different prices.
Don’t get confused as you browse the options: you’ll see the terms “white label gateway” and “white label payment processor”, which most likely still have the same meaning. Usually, people use these terms to differentiate a company providing a service (payment processor) from the provided software (payment gateway).
Why choosing white label PSP is better than building your own
There are several reasons why considering white label payment processing turns out much more efficient than developing your own solution. Here are the main of them:
- It’s faster. You’ll need no less than three years to hire a team, develop your own software, obtain necessary licenses and pass security and compliance audits, establish connections and integrations with third parties, and get your first client on board. Choosing white label PSP makes you all set in a month or even less.
- It’s cheaper. Development accounts for the most significant share of the costs you’ll have to bear, but there’s much more to pay for: equipment, licenses, audits, etc. Moreover, odds are you’ll just waste some of the money, alongside time and resources, because some things may not work, and some can go wrong. All in all, white label PSP ends up being much cheaper and cost-efficient.
- It requires minimal effort on your side. The provider of the white label solution you opt for will help you to get started without the development effort needed from you. They will most likely offer you technical support and maintenance as you use the solution. Isn’t it great to have everything taken care of by professionals?
- It’s safe and feature-rich out-of-the-box. As we’ve mentioned, there’s a variety of white labels on the market. Competition drives innovation, so payment service providers equip their offerings with a range of supporting features and enhanced capabilities. It’s up to you to choose what meets your needs the best.
- It allows you to focus on building relationships with your clients. White label PSP deprives you of the burden of technical hassle, so you don’t have to worry about it and can fully dedicate your time and efforts to building relationships with your merchants and expanding your client base.
Cons of using white label payment service provider
Now we should have listed the drawbacks of a white label payment service provider compared to a custom-made one, but there’s not that much to explore. First of all, it’s a possible lack of customisation and tweaking. Moreover, it makes you technically dependable on the solution provider. That’s why, as with everything regarding payments, you should key in on security and trustworthiness.
Take your time and do some research to find a payment gateway service provider that will become your reliable partner. In this case, you may even never experience the abovementioned cons. For instance, we offer lifetime maintenance and support for clients using our product and work closely with them to add additional features or integrations they need.
Ready to try it?
If you’re deciding on whether or not to give a white label solution a shot, book a call with us. We’d love to meet you and showcase how you can use our platform for your benefit.