e-commerce Foundation rolls out 2012 Payment Services Providers review

The study was sponsored by product information management provider Unic, German-based multi-channel commerce software vendor hybris and Dutch online payment services provider Buckaroo.

The number of participating merchants reached 165 mainly coming from the retail area as they represent more than 80 per cent of participants. Most Merchants are relatively small, having less than 10 employees. However, 10 percent of the participating companies had more than 100 FTE.

Participants were asked to rate their PSP on several criteria including:
• Offered payment methods
• Front-end (website) integration
• Payment analytics
• Reconciliation and reporting
• Fraud control/reduction
• Extra/innovative features
• Technical quality/availability
• Service/support
• Price/quality ratio

According to results, no big differences have been noticed as most of criteria have been rated within the same range with the exception of “Extra / Innovative features. In fact it is important to emphasize that merchants think that there is a lack of innovation / new features within PSP solutions in general.

Data also indicates that the average commission paid to PSPs is 1.78 percent. However, research emphasizes that this commission varies depending on the size of the company. The biggest the organization, the higher is the commission paid to PSPs. The fraud rate is also a very interesting KPI when talking about the online payment ecosystem. In average fraud occurs at a rate of 0.25 percent, however here again, it differs strongly regarding company sizes and industries.

The Net Promotion Score (NPS) indicator was also used in order to determinate the level of merchants’ satisfaction. Merchants were asked if they would recommend their affiliate network on a scale from 0 - 10, 0 being “not at all likely” and 10 “extremely likely”. A NPS score of 5 to 10 is considered average. Above 50 is considered very good. Below 0 means there are more detractors then promoters.

The Payment Services Providers as an industry have a NPS of +2 which can be considered as average. Within the eCommerce suppliers ecosphere it is however way higher than Affiliate networks our first supplier review (-17, Affiliate network review, June 2012).