The business of merchant services continues to undergo two forms of transformation. First, the merchant services businesses, either as acquiring banks or via non-bank acquirers, has undergone massive consolidation over the last five years and more. Fiserv’s takeover of First Data, announced on January 16, is just the latest example.
The second sea change is the expansion of products and services these entities deliver. What was a fairly innovation-averse industry has become, under the competitive pressure of companies like PayPal and Square, far more committed to delivering value that helps customers run their business, not just accept card payments.
At the POS, Square changed the merchant services game by delivering a great deal more business value to the small merchant than the traditional ISO or agent focused on placing stand-beside terminals next to dumb cash registers. For the price of payment processing, Square has given those merchants inventory, time and attendance, sales and marketing focused reporting, and more.
As a result, the giants in this game have been forced to respond. In 2013, First Data acquired Clover to reach small retailers and restaurant customers. Others, like Global Payments’ Heartland unit, have invested heavily in serving the mid-tier and larger restaurant industry.
To deliver similarly broad services, TSYS recently come out with three new merchant offerings targeted at micro merchants, single shop operations, and larger merchants. The new line is called Vital, at vitalpos.com and its solutions are called Vital Mobile, Vital Plus, and Vital Select.
Along with the new Vital hardware, we can expect the offering, taking advantage of cloud delivery, to expand its software and services line-up in the future - a trick that the old POS terminal model never could pull off.
Take a listen to this episode’s discussion with Gavin Rosenberg, vice president of product marketing, at TSYS. It’s a revealing conversation about the decision making and product strategy of a major provider of merchant services.