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That said, not every AI initiative has hit the mark. Take the the potential for powerful AI companies to completely
Apple Card situation in 2019. Goldman caught heat when reformat the payments industry from a position of power
it was claimed their AI underwriting gave lower limits and dominance.
to women, after developer David Heinemeier Hansson
alleged he received 20 times his wife's credit limit even Companies that use the power of training large language
though she had a higher credit score than he did. models with massive amounts of payments data can
achieve better control of risk and fraud, accelerate the flow
This became a massive PR headache and raised concerns of funds to businesses, provide dashboards and reports
about whether "gender blind" algorithms (or you can that better inform business owners, make suggestions as
replace "gender" for other identifying characteristics in to how to manage their businesses better, and provide
other applications) could still potentially produce biased a more convincing sales proposal than traditional ISOs.
outcomes through proxy variables. The New York State They can sell more effectively direct to merchants without
Regulator concluded in March 2021 that there was no clear the high cost of sales agents' residual share.
evidence of unlawful discrimination against women, but
the reputational impact had already been done. Our industry is a huge target for companies that can
dominate with AI. We have recurring revenues, payment
Looking ahead, I think AI is going to force ISOs to evolve acceptance that is embedded in the merchant and
faster, creating more differentiation. We're already seeing cardholder communities, decent profit margins, and the
smarter fraud tools, better transaction routing and opportunity to quietly raise prices from time to time. AI
predictive underwriting models—but what's coming next masters complexity.
can be more transformative.
The complexity of merchant services has been a rampart
I expect AI to reshape agent support, pricing analysis, that kept many invaders away for a long time. I see this
portfolio risk modeling and even merchant onboarding. changing at a rapid pace.
The ISOs that learn to integrate AI into their workflows,
rather than waiting for upstream partners to do it for
them, will be the ones that differentiate in the market, Dee Karawadra
streamline their overhead and scale faster. Impact Pays

That said, we have to be mindful of the bigger picture. We're in the thick of it. At ISOhub, we're actively training
There's a real risk of many smaller ISOs being cut out of the AI to analyze past merchant and agent notes to suggest
equation if they don't evolve fast enough to demonstrate resolutions—basically, a support assistant who never takes
that they offer any true benefit. a day off or forgets what happened last month.

Acquirers and processors are investing heavily in AI to But we're not just rushing it out the door. We're still in
automate more of the value chain, and some may eventually the training phase, making sure it's fed the right data
see less need for traditional ISOs for relationship building and giving back the right results. We won't release it until
and direct to merchant marketing. So while AI creates we're confident it actually helps, not just looks fancy in a
opportunity, it may also force us to have to rethink our sales deck.
positioning.
Fraud detection and underwriting are clear wins. AI's
Something that's always been true, though, is that the making fast, smarter decisions. But there's also a lot of
future belongs to those who could add value beyond just noise. Way too many folks are slapping "AI" on what's
selling accounts, whether that's through smarter tools, really just a glorified chatbot. If it's only answering FAQs
consultative service or vertical-specific expertise. Anyone and can't handle nuance, it's not innovation; it's marketing
who recognizes AI as one more tool in the kit, and can with a hoodie on.
effectively leverage it to give themselves a competitive
advantage, will end up enjoying the success of their new For us, AI is about helping ISOs punch above their weight:
Model T while they leave behind everyone who's still automating residual insights, speeding up support and
shoveling horse dung. giving agents tools that used to require a full team.
Industry-wide, AI will eliminate a lot of the grunt work,
improve decision-making and (hopefully) improve the
Mark Dunn merchant experience.
Field Guide Enterprises LLC
My concern? That companies will get caught up in hype
I see the traditional ISO business using AI in traditional and launch half-baked solutions. We're taking the opposite
ways: to market better, compose more attractive sales approach: train it right, test it hard, and roll it out only
materials, sell more effectively, install quicker and when it works for real people in real workflows.
support merchants better. What I am not seeing—and am
concerned about—is the traditional ISO industry realizing
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