By Peter Galvin
NMI
Seamless payment experiences have become an indispensable offering for major digital platforms. Most customers don't think twice when they make a purchase through the Uber app or on Amazon Prime video, but the quality of these payment experiences is a major reason for these apps' success.
Social media giants like Instagram and Twitter have also entered the payments space. Instagram's social commerce offering's popularity has grown since its launch in 2021, and X (formerly Twitter) CEO Elon Musk outlined plans to integrate services like peer-to-peer transactions and debit card payments into the app.
Clearly, these major corporations have the resources to roll out effective payment offerings. But what about smaller merchants, many of whom lack the finances, staff or expertise to enable payments in their platform? By enlisting the help of independent software vendors (ISVs), they, too, can roll out omnichannel payment offerings that support a smooth user experience for customers.
The benefits of embedded payments are clear. Previously, if someone saw a pair of shoes they wanted on Instagram, they'd have to leave the app to complete the purchase. Now, through Instagram Shopping, users can complete their purchase on the app and continue scrolling without disruptions.
However, bulky, poorly integrated payments will likely turn customers away—not only from the transaction, but from the platform itself. Poorly integrated payments can mean forcing users to create an account, displaying an unclear UX interface, or offering payments on one channel but not another. Thus, for example, a customer may browse a local boutique's cumbersome website for a birthday gift but grow frustrated and opt to shop on Amazon instead.
Regardless of how simple payment processing may appear to end users, it's much easier to create a poorly integrated payment offering than a seamless one—especially for small merchants who have scant experience in the space. Merchants are experts on their own products and industry, but integrating payments requires a different level of expertise. This is where ISVs become essential.
ISVs develop software stacks for specific industry verticals. Partnering with ISVs enables small merchants to implement new payment technologies quickly and cost-effectively. However, ISVs vary in expertise, cost and services; some options may be a better fit for a particular organization than others.
Here are three factors for merchants to consider when choosing an ISV partner:
Within these platforms, an ISV should also offer different payment methods, including credit cards, Apple Pay or buy now, pay later. A wealth of payment options across multiple channels enables a merchant to pick and choose platforms to prioritize, knowing an ISV partner can integrate them with all pre-existing channels.
Businesses also should know what they're paying for before they commit. They should ask whether the ISV's products include payment processing, customer support and analytics, and ask how overall costs change as they scale up and move into different verticals. Gaining a holistic view of the ISV's value proposition can help merchants identify the one that best aligns with their own goals.
Noticing a new payment capability that customers find useful is one thing. But merchants also must turn observations into action. This is where a strong relationship, clear workflows and timely communication become essential. When gauging potential providers, businesses must ascertain how quickly it will take ISVs to get new offerings off the ground.
The rising number of tech companies entering the payments space shows how essential payment capabilities are becoming. The major players obviously have the advantage when it comes to resources, but small businesses can remain competitive by outsourcing responsibilities to ISV providers that understand the payments landscape.
This investment enables merchants to offer their customers the seamless omnichannel experiences they've grown to love—and now expect. 
Peter Galvin is chief marketing officer at NMI, www.nmi.com. NMI's mission is to power the next era of payments by constantly innovating to keep ISVs, ISOs, banks and fintechs on the cutting edge of payment processing so they can focus on what they do best. Contact him via LinkedIn at linkedin.com/in/petergalvin or follow him on Twitter at Pgalvin63.
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