How ISOs can compete with Aggregators

Stripe, Square, and Paypal are massive payment aggregation platforms that many merchants rely on. Even though these aggregators play a prominent role in the payment space, ISOs have many opportunities to compete and succeed, and provide even better payment solutions. 

Payment Aggregator Fundamentals

A payment aggregator allows merchants to begin processing payments as sub-merchants rather than opening their unique merchant accounts. They are designed to enable companies with a smooth end-to-end payment process to accept various payments quickly and easily. 

Since these aggregators have merchants use the aggregator's merchant account, the aggregator's funds from sub-merchants are initially controlled by the aggregator instead of the funds going into the merchant's account. This allows the aggregator to maintain control of funds if there are any issues or complications. Additionally, many offer their own banking-like services, such as mobile apps enabling consumers to pay online for goods and services

Strengths of Aggregators

Aggregators allow small businesses to quickly and cheaply begin processing payments without having to invest in opening their own merchant accounts. This is especially useful for companies that process large numbers of transactions that are small in size individually. 

These small businesses can also circumvent the underwriting process for merchant accounts, which requires extensive documentation, and many payment providers need help to provide an easy onboarding process. By comparison, aggregators can offer speedy payment solutions for businesses that immediately need a solution. 

Success of Big Aggregators

Three massive aggregators are in the payment space: Stripe, Square, and Paypal. All three bring their own unique strengths that lead to success.


Stripe is more geared towards online payments but provides some handy tools. They make it easy for merchants to integrate payments and online shopping carts and offer a smooth online customer experience. They also enable companies to process international payments securely and effectively. 

With Stripe, customization is easy to implement as their solutions are designed to be developer-friendly. This enables Stripe to tailor to the needs of a specific customer and dramatically improves the entire payment process for a merchant and their customers. Stripe is also designed to integrate easily with various applications such as Shopify or Docusign, allowing merchants to provide a truly unique online shopping experience

Since it was founded in 2010 by the Collison brothers, Stripe has exploded into the payments space. Hundreds of billions per year in transactions are entrusted to Stripe by companies worldwide, with more than 100 companies processing more than $1 billion yearly. Additionally, Stripe has dramatically increased its customer base internationally despite being started initially in the US


Square is specifically designed to be an easy-to-implement payment solution. This is especially useful for small businesses that do not have the ability to invest more time into building their payment infrastructure. Unsurprisingly, many small businesses have turned to Square as their go-to payment solution. 

Square also offers merchants quick payouts of funds, which is very popular among small businesses. They also provide easy-to-use equipment and flat-rate pricing that a merchant can understand and implement. Square is designed to allow merchants to begin processing payments with as little friction as possible. 

Square was founded in 2009 and has been able to be incredibly successful in the payment space, and the numbers speak for themselves. An estimated four million merchants use Square to enable them to collect payments, resulting in almost $200 billion a year in transactions passing through Square. Essential to this success was Square's releasing the first card reader for mobile devices


Paypal is undoubtedly a giant in the payment space, and for good reason. Paypal makes it incredibly easy for customers to pay companies online or allow individuals to pay others. Checkouts with PayPal are straightforward and easy to use, with customers using PayPal as their preferred payment method. 

International customers or currencies are relatively easy with PayPal. This allows companies to sell to a wide variety of customers and not limit themselves to one specific market. Similar to Stripe, Paypal comes with a wide range of integrations that enable users to smoothly use it with other popular applications such as Discord or Gmail. 

PayPal's roots begin all the way back in 1998, and since then, it has been at the forefront of payment innovation. Their initial path to success came from becoming the official payment partner for eBay back in 2002. Since then, PayPal has been fearless in exploring and investing in new innovations. The results speak for themselves, as PayPal has over 400 million active users who process over $ 1 trillion in transactions

How ISOs Can Compete

Stripe, Square, and Paypal are daunting figures in the payment space and can seem insurmountable to an ISO. Fortunately, there are many opportunities for ISOs and lessons that they can learn from large aggregators. 

Customer Experience

All three aggregators provide easy-to-use solutions. Building out a payment system is incredibly daunting for many companies, and getting their own unique merchant account adds a wide variety of challenges. 

Numerous compliance regulations and documentation are required to open a merchant account, and this underwriting process is traditionally time-consuming. Unfortunately, this makes aggregators more appealing by offering fast onboarding by making their customers sub-merchants instead of helping them set up their own merchant accounts. 

These aggregators have geared many of their services to enable small businesses to quickly set up a payment system. ISOs have an additional challenge meeting this expectation as they work to provide businesses with their own merchant accounts rather than onboarding them quickly as sub-merchants. 

Fortunately, ISO are well positioned to offer many of the same customer experience benefits as aggregators. ISOs can lead the charge when working out the details of a payment system, allowing merchants to focus on what they do best. ISOs can easily handle the complexity of payment processing and often provide great customer service, which is key to competing with aggregators

Commitment to Innovation 

All three of the large payment aggregators have been bold in investing in innovation throughout their history. From forming productive partnerships to creating their own unique payment hardware, these aggregators leveraged innovation in order to become giants in the payment space.

ISOs have numerous opportunities to invest in innovative software that can dramatically improve the quality of payment products they can offer merchants. CRM integrations allow ISOs to provide proactive support and communication between themselves and merchants and put ISOs to respond to customer needs effectively. Various integrations also allow ISOs to automate various aspects of their operations, speeding up their services while making them more cost-effective. 

Risk Mitigation

Aggregators generally have algorithms allowing for certain transaction types and sizes. If a business runs a transaction outside of those guidelines, funds can be held. Many businesses have found their funds held by aggregators due to compliance issues, transaction sizes, or processing outside of the approved monthly limit. This can be frustrating for business owners because a lot of times, a larger-than-normal transaction or a month of higher volume can be part of business. 

ISOs are presented with a unique opportunity to win business if a company is coming from experiencing frustrating risk holds with an aggregator. Even more so if the company had to wait a long time to get the money back and had no support. ISOs have found success in giving a personal touch and working with the business owner to try to avoid risk holds, or when they do happen, work with the processor to effectively set expectations for the business owner. 

This is another way ISOs are uniquely positioned to provide merchants with a smooth customer experience. While payment processors (or sponsoring banks) themselves have control of these risk holds, ISOs can help ensure that merchants are making informed decisions about their payment system and avoid risk in the first place. 

How Under Can Help

Under is here to provide ISOs with the best in application, onboarding, and underwriting solutions. Large payment aggregators often win due to their incredibly fast onboarding process, which is convenient for merchants. With Under, ISOs can quickly verify and onboard merchants at unprecedented speeds and compete with the efficient onboarding process that aggregators offer. 

We also provide numerous identity verification integrations to ISOs to verify merchants worldwide while maintaining regulation compliance. This makes it easy for ISOs to maintain compliance and avoid risk. Additionally, we provide fast and easily customizable online applications that allow merchants to sign up for an ISO quickly. We provide extensive automation throughout onboarding, allowing ISOs to speed up merchant onboarding dramatically.

Under also provides an ISO CRM integrations to improve the customer experience for merchants looking for a new payment system. We are committed to providing the most innovative onboarding tools that make the lives of ISOs and merchants as easy as possible. An ISO can compete with large payment aggregators by leveraging Under's tools centered around risk mitigation, customer experience, and innovation. 

Click here to learn more about how Under can enable your business to compete with payment aggregators. 

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