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Pipe

In the fast-paced fintech landscape, strategic partnerships are crucial for fostering innovation and accelerating growth. With a focus on 

, Pipe distinguishes itself by offering a spectrum of partnership models, each designed to cater to the varying needs of its partners and their end-users. These models range from referral partnerships to deep integrations, illustrating Pipe's commitment to flexibility and mutual growth.

At the foundation of Pipe's partnership strategy lies the referral model. This approach is built on simplicity and accessibility, allowing partners to refer their clients to Pipe's capital solutions. It's a mutually beneficial arrangement where partners can enhance their service offerings without the need for direct integration. For businesses looking for quick and straightforward ways to provide additional value to their customers, the referral model offers an entry point into the world of embedded finance.

Pipe Hosted Approach with One Data API Integration

Moving a step further, Pipe offers a hosted approach through a single data API integration. This model is designed for partners seeking a balance between 

 and a seamless user experience. By leveraging pre-approved offers based on the partner's merchants’ data, this approach allows for a more 

personalized and streamlined service directly within Pipe's platform

. It's an efficient way to offer embedded capital solutions without full integration.

 aiming for the pinnacle of seamless integration, Pipe offers a comprehensive solution through deeper integration via SDKs and APIs. This model is tailored for platforms that prioritize a native experience for their users, embedding Pipe's 

 directly into the partner's ecosystem. It transforms the way capital is accessed, making it an integral part of the partner platform's workflow. This deep integration ensures that the end-users benefit from a frictionless experience, accessing capital as if it were a native feature of the platform they’re already using. While the technical demands of a full integration are a bit higher, our expert Product and Engineering team offers support every step of the way.

Through these strategic collaborations, Pipe not only improves financial access for small businesses but also enriches the ecosystems of its partners. For instance, a software platform for SMBs can integrate Pipe's embedded capital solutions to offer their users instant access to 

 without leaving the platform. This not only enhances the platform's value proposition but also supports the growth and sustainability of the businesses it serves.

Building Success Together: Pipe's Partnership-First Approach

Implementing these partnership models requires aligning strategic goals and managing technical integrations. However, Pipe's commitment to flexibility, combined with our technical support, ensures that these challenges are navigated successfully.

Pipe distinguishes itself from traditional funding sources by prioritizing a partnership-first approach rather than merely facilitating transactions. Unlike conventional lenders that may impose rigid terms and focus solely on profitability, Pipe collaborates closely with businesses to understand their unique challenges and opportunities. This collaborative approach ensures the capital solutions provided aren’t just tools for immediate needs but are part of a strategic framework designed to support long-term growth and success.

Whether through simple referrals, hosted solutions, or deep integrations, Pipe offers a capital funding model that caters to the unique needs of our partners. This flexibility not only fosters growth and innovation but also ensures that end-users have seamless access to the financial services they need. As the fintech landscape continues to evolve, we hope our collaborative model serves as a blueprint for how strategic partnerships can unlock new possibilities and drive the industry forward.

Interested to learn more? Watch the full conversation between Luke Voiles (CEO of Pipe) and Tom Priore (CEO of Priority) 

Three ways Payfacs and ISVs can partner with Pipe to quickly launch an embedded capital offering.

Three ways Payfacs and ISVs can partner with Pipe to quickly launch an embedded capital offering to support their merchants, grow GPV, and drive new revenue

Discover Pipe's Partnership Ecosystem

As the small business economy evolves, Payment Facilitators (Payfacs) are a crucial partner enabling seamless transactions across platforms. However, in an increasingly competitive marketplace, Payfacs must continuously seek innovative ways to enhance their value proposition and strengthen merchant loyalty. One strategy that’s gaining traction is the integration of 

—a move that promises not only to transform the Payfac ecosystem but also to improve merchant satisfaction and drive growth significantly.

The Value of Embedded Capital for Payfacs

 seamless integration of working capital within non-financial platforms

, allowing merchants to access funding directly through their existing payment processing systems. This innovative approach addresses a critical need among merchants for timely access to working capital, enhancing the overall service offering of Payfacs. By embedding capital solutions into their platforms, Payfacs can provide more comprehensive financial support, making it easier for merchants to manage cash flow and fuel growth without having to look elsewhere.

Enhancing Merchant Satisfaction and Loyalty

Direct access to embedded capital addresses one of the most common financial pain points for merchants: the need for 

. Whether it's to stock up on inventory before a peak season or to bridge a cash flow gap, merchants often find themselves in need of short-term funding. Traditional lending channels can be slow, requiring extensive paperwork and long waiting periods. Embedded capital offers a swift, streamlined alternative, significantly enhancing merchant satisfaction.

Moreover, by providing these essential financial services, Payfacs can foster greater loyalty among their merchant base. Merchants are more likely to stick with a Payfac that not only processes their transactions but also supports their growth and financial health. 

Offering embedded capital can serve as a powerful differentiator for Payfacs in a crowded market. Not only does it add value for merchants, but it also opens new revenue streams for Payfacs themselves. As merchants leverage embedded capital to expand their operations, they're likely to process more transactions and generate higher volumes, in turn, increasing the processing revenues for Payfacs, along with a share of fees generated from the capital product.

Operational Efficiency and Risk Management

By leveraging the vast amounts of data that Payfacs already collect, implementing embedded capital can be streamlined and efficient. This data can be used to assess whether merchants are qualified for a working capital offer, and 

the offers are tailored to the merchant's financial health

. This process is dynamic, generating new working capital offers as merchants grow, all while minimizing the risk of defaults by aligning payments with the merchant's cash flow.

Navigating Challenges and Maximizing Opportunities

While integrating embedded capital presents numerous opportunities, it also comes with challenges, such as regulatory compliance and the complexities of financial product integration. However, these challenges can be navigated with careful planning, leveraging 

partnerships with fintech companies like Pipe

, and employing robust technology solutions.

Embedded capital is set to transform Payment Facilitators, offering a strategic tool to enhance merchant services, drive growth, and differentiate in the market. By embracing this innovative approach, Payfacs can not only improve their value proposition but also foster deeper, more loyal relationships with their merchants.

As the digital economy continues to evolve, Payfacs that are quick to integrate embedded capital into their platforms will be well-positioned to lead the way, offering a comprehensive, supportive financial ecosystem that empowers merchants to thrive.

Interested to learn more? Watch the full conversation between 

Find out how embedded capital can help payment facilitators build merchant loyalty, grow GPV, and drive revenue, while managing their risks.

Find out how embedded capital can help payment facilitators build merchant loyalty, grow GPV, and drive revenue, while managing their risks and resources

Transforming Payfac Ecosystems with Embedded Capital

 marks the evolution from traditional, standalone financial services to their integration within platforms and services that businesses and merchants use daily. Initially, financial solutions were broad, one-size-fits-all tools. However, as technology advanced, these solutions began to specialize, catering to the unique needs of specific industries or verticals. This transition from horizontal to vertical-specific tools has significantly enhanced the customer experience by providing more tailored, relevant, and efficient tools. It’s also made embedded financing much more powerful.

Embedded Finance and Its Impact on Small Businesses

For small businesses, embedded finance has been a game changer. By 

integrating embedded capital solutions directly into business platforms

, companies gain direct access to capital, without ever leaving their operational ecosystem. This 

 empowers businesses to focus more on growth and less on funding logistics.

For example, think about a coffee shop that, two decades ago, would manage transactions, payroll, and accounting through cumbersome, manual processes. Today, that same coffee shop can leverage specialized tools that handle all of this within a single platform. Now, with embedded finance, they can easily access working capital from within that same platform, with no need to compile financial statements and go to the bank.

The concept of unified commerce is emerging, where all facets of financial services—payments, banking, access to capital—are seamlessly integrated into a single platform. This unified approach makes financial management more intuitive and less time-consuming for business owners, who are often time-strapped and wearing multiple hats.

For small businesses, this could mean having a single dashboard that manages everything from inventory purchases to employee payroll, with embedded financial services like access to capital or payment processing. This level of integration not only streamlines operations but also provides businesses with a holistic view of their financial health, enabling better decision-making and fostering growth.

The evolution of embedded finance represents a significant leap forward in the way businesses interact with financial services. By breaking down the barriers between financial and operational platforms, embedded finance offers a more integrated, efficient, and accessible financial ecosystem for businesses of all sizes.

 continue to lead the way, driving innovations that promise to further transform the business landscape. In today’s market, staying ahead means embracing the integrated, seamless, and efficient solutions embedded capital provides.

This blog was inspired by the conversation between 

Payments, banking, and access to capital are coming together on unified platforms.

Payments, banking, and access to capital are coming together on unified platforms. See how embedded finance makes this possible in a whole new way. 

The Evolution of Embedded Finance Towards Unified Commerce

The Evolution of Embedded Finance: A Leap Towards Unified Commerce

Independent Software Vendors (ISVs) are at the forefront of technological innovation, crafting solutions that not only meet but anticipate the needs of businesses across industries. As these ISVs seek to provide more value and deepen user engagement, embedded finance emerges as a key area of opportunity. 

Integrating financial services—particularly access to working capital

—into software platforms can transform user experiences, open new revenue streams, and ensure platform stickiness.

 refers to integrating financial services within non-financial platforms. For ISVs, this means offering users access to financial products—such as capital, lending, payment processing, and insurance—directly within their software. This integration creates a seamless experience for users, who can access financial tools without leaving the platform, enhancing efficiency and user satisfaction.

Partnering with Embedded Capital Providers

For ISVs interested in integrating  a working capital model for embedded finance, various partnership models exist. These range from referral agreements with financial institutions to deeper tech-enabled collaborations involving API integrations. Pipe offers flexible embedded capital partnership models that allow ISVs to choose the level of integration that best suits their platform and user needs. Through these partnerships, ISVs can provide embedded capital solutions that appear native to their platforms, enhancing the user experience without the need to develop complex financial services in-house.

Embedded finance within ISV platforms can be transformative. For example, business management software integrating embedded capital can enable its users to apply for and manage a loan or advance directly through the software, using data already within the system to streamline the application process. This not only simplifies access to capital for businesses but also strengthens the software's role as an indispensable tool for business operations.

Despite the clear benefits, ISVs may have concerns about implementing embedded finance, from technical integration challenges to maintaining user trust. Collaborating with established fintech partners like Pipe can alleviate these concerns. Pipe's experience and technology enable smooth integration of financial services, ensuring compliance, data security, and a seamless user experience.

For ISVs looking to future-proof their platforms and drive growth, embedding financial services offer a compelling opportunity. By integrating working capital and other financial solutions, ISVs can enhance their platform's value, foster deeper user engagement, and tap into new revenue streams. 

Pipe’s embedded capital offering isn’t a loan; it’s an advance based on a company’s revenue. This allows a wide range of businesses to access capital quickly, with an approval process that’s much faster than typical for lenders. By embedding Pipe Capital into your software platform, you give your merchants easy access to funding, including pre-qualified offers based on first-party transaction data.

Find out how ISVs can gain a strategic advantage by offering embedded financing and how simple it can be to implement

ISVs and the Future of Embedded Finance

Innovating at the Intersection: ISVs and the Future of Embedded Finance

Payment Facilitators (Payfacs) are constantly seeking innovative ways to enhance their offerings and add value for their merchants. Embedding financing options, like 

seamless integration of financial services

 that can increase merchant success and the growth of Payfacs themselves.

Embedded lending is the integration of lending services directly into the platforms that businesses already use for their daily operations. This approach eliminates the need for businesses to seek external financing solutions, providing them with fast, convenient access to capital. For Payfacs, embedded lending represents an opportunity to deepen relationships with merchants by addressing one of their most critical needs: access to funding.

Integrating an embedded capital product requires a strategic approach. Payfacs can look to 

, like those used by Pipe, which range from simple referrals to deep API integrations. These models provide flexibility in how Payfacs can offer services, allowing for a tailored approach that meets the needs of both them and their merchants.

While the benefits are clear, Payfacs still need to consider challenges such as regulatory compliance and integration complexities. Partnering with experienced fintech companies like Pipe can mitigate these challenges. Pipe's partnership-first approach ensures that Payfacs can implement embedded capital solutions that are not only compliant but also seamlessly integrated into their existing platforms.

Pipe’s embedded capital offering isn’t a loan, it’s an advance based on a company’s revenue. This allows a wide range of businesses to access capital quickly, with an approval process that’s much faster than typical for traditional lenders. By embedding Pipe Capital into your software platform, you give your merchants easy access to funding, including pre-qualified offers based on first-party transaction data.

 offers a pathway for Payfacs to significantly enhance their value proposition, deepen merchant relationships, and drive mutual growth. By addressing the critical need for access to capital, Payfacs can empower their merchants to achieve their growth objectives, resulting in increased processing volumes and revenue. As the digital payment landscape continues to evolve, embedded capital stands out as a strategic advantage for Payfacs willing to embrace innovation and partnership opportunities.

Here's how embedded lending and other embedded capital offerings can help Payfacs drive growth.

Here's how embedded lending and other embedded capital offerings can help Payfacs drive growth and become even more essential to the merchants they serve.

Empowering Growth: How Payfacs Can Leverage Embedded Lending

Connect with Ben on LinkedIn to keep the conversation going.

Ben Goodyear

This article was originally published on 

For more than a decade, I’ve held key financial positions with Mailchimp, Visa, Intuit, and Pipe, with front-row seats to the inner workings of small and mid-sized businesses. During that time, not a day has gone by that I wasn’t immersed in data. But the way we leverage data is changing, and with it, hopefully, the way you look at your own business data. 

There’s a common misconception among companies of all sizes that CFOs are focused entirely on financial statements and 

be heads-down looking at that bottom line. But in today’s world, there’s more than one bottom line and more than one way to get there. We’re all looking for an edge—either a way to get ahead of the competition or a way to improve 

 performance—and I believe comprehensive performance data is the key to finding that edge. 

We live in a complex world, and the complexity is only going to keep accelerating. Where CFOs once really 

limited to things like financial statements for insights, we’re now connected to more data and potential to measure performance than ever before. We have data measuring every part of the customer experience, from acquisition to engagement, performance, and attrition, all at our fingertips. Not only that, but we also have smarter tools to help us analyze that data with the help of AI and machine learning. 

All of this leads to two major shifts for the modern CFO. First, inputs from so many different places can revolutionize the way we make decisions. Instead of waiting for data that is backward-looking, we have the potential to invest in near real-time information. To make the most of all this data, we 

stay connected with the tools and know-how to analyze it. Anything else is just asking to be left behind by the competition. 

Secondly, CFOs must become experts in more than just the dollar signs and contribute to the company more broadly. In a complex market where small businesses and large corporations manage across multiple sales channels, compete for talent, and make financial decisions to grow their business, the world is more centered around data than ever. If you can help drive smarter decisions across functions, you’ll add value our finance forefathers and mothers only dreamed of.

Most companies I talk to ask about the tools and processes to make data-driven decisions. Here are five steps I suggest to them, and to you, to get a handle on your data and make the most of it for your company: 

Gone are the days of making financially or analytically inclined employees among your last hires. It bears repeating that companies that fail to prioritize data will be left behind. You need to reflect that value in your hiring decisions and the tools you invest in. 

Hire data-savvy people early on and equip them with the technology to capture, see, and analyze data in the best way. This will result in high-quality, usable data that will move your company forward and lead to much better decision-making.  

 data out there, knowing where to focus is important. Make strategic choices about the metrics sacred to your sales and marketing funnel, customer satisfaction, and profitability. Once you know what to track, you can align your team around these numbers so everyone is on the same page. There’s nothing worse than monitoring metrics that don’t align with your goals or having your teams pour effort and time into work that moves the wrong needle. 

We all know that setting goals only helps if you track your progress. In the same way, monitoring key metrics in your data is only useful if you review them regularly. Determine the best frequency for these reviews and who needs to be involved and stick to that schedule. Remember, just because you have data does not mean you have to review it with your team every day. Give your data some time to bake so that your reviews hold real meaning.

With the right people on your team using the right tools, you can be confident that your data is accurate. This sets you free from doubt and lets you foster healthy debate around what to do about the data, not the data itself. This is an easy point to gloss over, but it’s key to the power of good data. With a shared understanding of what the numbers really measure, you can focus your time and attention on building strategies and taking action.  

Commit to action and track the progress 

All of these things move us toward an ultimate goal: a culture that embraces the discussion and evolution of strategy. All this data makes it possible to see shifts beneath the surface and, in some cases, even predict them before they arrive. Meaningful progress in our companies comes from embracing those shifts and taking committed action as a result. That’s how the data-driven CFO becomes a driver of results.

As CFOs, we sit in the perfect position to harness the power of data. We’re well-equipped to make analytical decisions based on hard numbers. Now we need to direct that analytical thinking to more than just the financials. With accurate, reliable data, we can contribute to the company in new and exciting ways that have an outsized impact on the bottom line and beyond. 

Discover how embedded lending can help Payfacs and ISVs grow faster and how alternatives like Pipe can help streamline the process

Unlocking Business Growth with Embedded Lending

How to unlock financial data as a growth tool, no matter your business size

Connect with Kyle on LinkedIn to keep the conversation going.

Kyle Polley

Embedded finance has emerged as a critical component in today's fintech ecosystem, offering an agile, seamless, and consumer-centric way to deliver financial services. This integration transforms many platforms, from online marketplaces to mobile apps, into hubs for financial transactions. While the opportunities are promising, the security of these financial technologies remains a paramount concern. In this post, we will explore the two cornerstone technologies—APIs and iFrames—that enable embedded finance and discuss best practices for securing them.

 refers to the seamless integration of financial services into platforms and applications outside of the traditional financial sector. This integration is facilitated primarily through two technologies: Application Programming Interfaces (APIs) and Inline Frames (iFrames).

APIs act as the intermediary that allows two different software applications to communicate and interact. They enable third-party services to access specific functionalities or data of a primary service provider. For example, APIs are crucial for integrating payment gateways, investment platforms, or insurance services into embedded finance ecosystems.

 allow the embedding of an HTML document within another HTML document. This technology enables the integration of various financial services—like secure payment forms or loan applications—directly into a website. Despite its occasionally negative reputation for being associated with ads and phishing schemes, when deployed correctly, iFrames can serve as a secure and effective tool for integrating complex financial functionalities.

Enforcing SSL (Secure Socket Layer) encryption and HTTPS (HyperText Transfer Protocol Secure) protocols for all API calls is the foundational step in securing API communications. This encryption ensures that any data transmitted over the internet is encrypted, rendering it unintelligible to unauthorized third parties. By doing so, organizations can substantially mitigate the risks associated with Man-In-The-Middle attacks, where an attacker could intercept, read, and potentially modify the data during transmission.

Rate limiting restricts the number of API calls from a particular IP address within a given time frame. This is crucial for protecting against Denial-of-Service (DoS) and Distributed Denial-of-Service (DDoS) attacks, where attackers attempt to flood the system with traffic to make it unresponsive. By implementing rate limiting, organizations can ensure that legitimate users still have access to services even when an attack is taking place, thereby preserving functionality and user experience.

 (ACLs) provide a structured approach to managing permissions. Granular ACLs can be set up to define precisely which users or systems have access to specific types of data or functionalities. This is particularly important for minimizing the potential damage that can be done if an API key is compromised. By adhering to the principle of "least privilege," wherein systems and users are given the minimum levels of access—or permissions—they need to perform their functions, organizations can significantly reduce security risks.

As APIs evolve and new features are added, it's crucial to regularly perform penetration testing. These tests simulate cyber-attacks to find vulnerabilities before malicious hackers can exploit them. Continuous testing, coupled with API hardening strategies such as input validation and output encoding, ensures that APIs remain secure even as they scale and evolve.

 attribute allows website owners to impose restrictions on iFrames, thus isolating them from other elements on the page. This isolation ensures that even if the iFrame contains malicious code, it cannot easily impact the main website or its visitors. Owners can customize the level of access the iFrame has to various browser functions, such as running scripts, submitting forms, or accessing the DOM, providing an additional layer of security.

Limiting Which Websites Can Render an iFrame

To prevent Clickjacking attacks—where attackers trick users into clicking hidden elements within an iFrame—it's essential to control which websites can render your iFrames. Using HTTP headers like 

 can limit the rendering to trusted domains or even restrict it to the same origin.

Validation and sanitization of user input are vital for preventing Cross-Site Scripting (XSS) attacks, where attackers inject malicious scripts through input fields. Utilizing modern browser features like the 

 interface allows for secure two-way communication between the iFrame and the parent document.

Moreover, sanitization techniques should be applied to strip out or neutralize characters that have special meanings in HTML, JavaScript, or SQL, thereby reducing the risk of code injection attacks.

The integration of financial services into various platforms through embedded finance offers unparalleled convenience and functionality. However, the security of these integrations cannot be compromised. By understanding the unique security concerns related to APIs and iFrames, organizations can implement effective strategies to protect against vulnerabilities and potential attacks.

Security isn’t just a feature —it’s a core foundational element of embedded finance. Every strategic decision must be calibrated with the safety and privacy of a customer’s data as a top priority.

 Type II attestation is a significant milestone that demonstrates a commitment to data protection and maintaining customer trust. Like the penetration testing mentioned earlier, SOC2 attestation invites external testing and scrutiny of a company’s controls and safety measures and serves as concrete evidence that it is meeting industry-leading standards in safeguarding customer data and maintaining a secure operational environment.

As embedded finance continues to evolve, keeping security at the forefront will be key to fostering trust and facilitating seamless user experiences. With robust security measures in place, embedded finance can indeed become a secure and invaluable asset in the evolving digital landscape.

Key points to keep in mind to ensure your embedded finance offering is secure and your users' data is protected.

Key points to keep in mind to ensure your embedded finance offering is secure and your users' data is protected against fraud and unauthorized access. 

How to optimize security in embedded finance

Connect with Namrata on LinkedIn to keep the conversation going.

Namrata Ganatra

Personalization has become a cornerstone in shaping products and services today. As consumers, we’ve grown accustomed to customized offerings, an expectation that's rapidly expanding into the B2B sector. Within this evolving market, the payments industry has a notable advantage: access to a vast amount of first-party data gives companies accepting payments a unique edge. This sets the stage for verticalized Independent Software Vendors (ISVs) and payment facilitators (PayFacs) to develop finance solutions tailored to specific industry requirements and even bespoke offers for a company’s unique situation.

Companies that facilitate and handle payments are sitting on a goldmine: their 

. This wealth of data holds more than just transactional details; it reveals patterns, preferences, financial health, seasonality trends, and behaviors of the customers and merchants involved.

In the broader digital landscape, the prominence of 

 is waning due to increasing privacy concerns and stringent regulations. These changes have diminished the reliability and depth of insights from third-party data sources, making first-party data even more invaluable.

First-party transaction data offers several distinct advantages:

Direct Insight: Unlike data sourced from third parties, which may be diluted or generic, first-party data is direct and unfiltered. This means a clearer picture of customer preferences and behaviors without the noise of external sources.

Timeliness: Real-time transaction data allows companies to swiftly respond to emerging trends, customer needs, or market shifts, providing agility that's critical in the fast-paced world of finance.

Relevance: By analyzing transactional trends, payment companies can discern not only what products or services a customer prefers but also when and how they prefer them. This granular level of detail allows for the creation of highly relevant product offerings.

Privacy & Compliance: Using first-party data reduces reliance on external data sources, which often come with a host of privacy concerns and regulatory implications. Companies can have better control over data handling, ensuring both security and compliance.

Armed with these insights from first-party data, payment companies are in a prime position to craft personalized financial products and services. These tailored offerings, rooted in real transactional behaviors, can resonate more deeply with customers, leading to increased loyalty and engagement. The potential extends beyond just offering products; it opens doors to proactive solutions, anticipating customer needs even before they are explicitly expressed.

Unique positioning of verticalized ISVs and PayFacs

Verticalized ISVs and PayFacs stand distinctively in the payments ecosystem, owing to their deep industry understanding and access to transactional data. This combination allows them to design highly tailored financial solutions. More than just addressing current needs, their keen grasp of industry-specific challenges positions them to anticipate and create solutions for future demands. Instead of merely adapting, they're often a step ahead, aligning their offerings closely with the evolving needs of the industries they serve, thus becoming strategic partners rather than just service providers.

Transactional data isn't just about numbers—it's a window into a merchant's daily operations. By analyzing this data, companies can 

 on a daily basis, ensuring timely financial support. Moreover, pre-qualifying merchants based on this data can lead to more effective marketing campaigns. For instance, offering funding solutions at the right time or providing merchants with indicative funding limits can result in improved customer engagement and loyalty.

Beyond immediate financial offerings, transactional data provides a roadmap for long-term relationship building with merchants. By continuously monitoring and understanding spending patterns, seasonality, and other financial behaviors, payment companies can predict potential business challenges and opportunities for merchants. This proactive approach enables companies to tailor their financial products, not only addressing immediate needs but also future-proofing merchants and building those future needs into their product roadmap. In doing so, they position themselves as invaluable partners, deeply embedded in the growth journey of their merchants.

With the recommendation engine market poised to reach $54 billion by 2030, the potential for ISVs and PayFacs is significant. These engines, powered by first-party data, can push real-time product suggestions that resonate with the merchant's immediate needs. Whether it's a tailored financial product or a unique service offering, timely and relevant recommendations can drive growth and customer satisfaction.

A recommendation engine, tapping into this financial data, could proactively suggest a tailored financing solution to help manage inventory or expand operations. Conversely, during slower periods, it might propose 

. By constantly analyzing transaction trends, payment behaviors, and historical financial data, these engines can pinpoint the exact financial product a merchant might require, even before the merchant realizes the need. This level of anticipatory service, backed by powerful algorithms, ensures that financial solutions are not only relevant but also delivered at the optimal moment, maximizing impact and fostering deeper merchant trust.

Beyond immediate financial solutions, ISVs and PayFacs have the potential to introduce credit and savings programs that genuinely matter to merchants. Relevant reward schemes, for instance, can motivate merchants to engage more with a platform. On the savings front, offering multiple high-yield savings account options allows merchants to diversify their financial goals, from short-term objectives to long-term financial security. Moreover, given the unpredictable nature of business incomes, offering investment platforms with varying degrees of liquidity and returns can help merchants optimize their surplus cash.

Maximizing merchant loyalty through tailored rewards programs

Harnessing the depth of first-party transaction data, PayFacs and ISVs are uniquely positioned to create bespoke loyalty and rewards programs for their merchants. One such approach is the introduction of Tiered Benefits. For example, merchants who achieve specific transaction milestones could enjoy perks such as reduced fees, access to premium customer support, or even the chance to engage in exclusive partnerships. 

Additionally, to foster a sense of community and expand their network, PayFacs and ISVs can roll out Referral Programs. In this model, merchants are rewarded for bringing new businesses on board. These rewards could manifest as cashback incentives or special discounts on transaction rates. In essence, by tapping into personalized data-driven strategies, PayFacs and ISVs can ensure that their reward systems resonate more deeply with their merchant partners, driving both loyalty and growth.

The payments industry is at an inflection point, with the potential to reshape its future through personalization. With the right mix of data, technology, and industry expertise, verticalized ISVs and PayFacs can craft financial solutions that not only meet the present needs of the industry but also anticipate its future demands. As the lines between B2C and B2B continue to blur, personalization stands as a key differentiator, promising growth, loyalty, and long-term success.

Pipe CPTO Namrata Ganatra shares how Payfacs and ISVs can leverage personalization and first-party data to improve merchant experience.

Pipe CPTO Namrata Ganatra shares how payment processors and ISVs can leverage personalization and first-party data to improve merchant experience and metrics

Personalization and the Payment Industry

How the Payments Industry Can Leverage Personalization to Grow GPV and Loyalty

Yas Moaven

Building trust is hard but absolutely worth it. Across b2b and b2c, decisions are made by human beings who want to do business with people they trust and who they believe truly understand them. It's just human nature. 

This is the reason community banks endure, even in the face of tough regulations and in competition with huge global banks. It’s why local small businesses can hold onto customers while competing with major chains. And it’s why software providers benefit from serving a specific industry. 

When you’ve built trust and a deep understanding of your customer’s industry, it only makes sense to find more and better ways to serve those customers and leverage your existing relationship with them. Right now, there’s no better way to do that than to expand your offering by adding financing. 

Here are four major reasons you should be 

 and a couple of things to keep in mind that will make the process go a whole lot smoother.

 grow faster by helping your customers grow 

By embedding financial services in your platform, you can help accelerate the growth of your customer base, increasing top-line revenue while adding a new, high-margin revenue stream. This is not only a great way to increase your GPV, but it also further grows the trust you’ve built.

Today’s merchants are incredibly busy. Anything you can do to streamline their lives is likely to be well-received. Traditional access to capital is slow and full of friction, and you can help them eliminate that problem. 

 not only allows them to access capital without ever leaving your platform (which saves them time), but it also allows them to work with someone they already know and trust, eliminating the need to vet a new vendor and decide which one to go with. 

You can provide better terms through industry insight and live data

Traditional financing providers, like banks, lack familiarity with many newer industries and business models. It’s not that they don’t understand them, but their underwriting systems are old-fashioned and require years of data to feel comfortable offering financing. Other business models are just not considered a good fit for investors or lenders, and can struggle with financial access. 

As a payments provider, you have unique data and insights into your industry, allowing you to deliver financial access to your merchants based on real-time hard numbers, not years of history and outdated models. The closer you are to your industry, the more true this is. Your understanding of revenue trends for your merchants makes it possible for you to offer better terms and customized offers that perfectly suit your merchants' needs.  

Embedded finance can help Improve customer stickiness

Vertical ISPs are in the fortunate position to have a very sticky product. Once someone is using your platform, it’s easier to stick around than it is to switch. Embedded finance takes that one step further. By allowing your merchants to take care of more of their business within your app, you get key decision-makers on the platform more frequently and encourage companies to migrate all their payments to your platform if they currently use you 

Super-apps like Stripe, Adyen, and even Shopify make it easy for their merchants to get everything they need in one place, and they’ve benefited from it tremendously. Within your unique industry, you have the opportunity to be the go-to, but there is one hurdle. Chances are, you’re not Stripe, Adyen, or Shopify. But don’t worry, you’re not alone.    

While you may not have expertise in capital markets or resources to spare building a capital product of your own, there’s a simple way to overcome these hurdles. By partnering with a company that’s built trust in the finance space, you can 

 that’s greater than the sum of its parts. 

–like those I mentioned earlier–are built on top of payments and digital transactions. As a payments provider, you have all the data necessary to fuel a capital product, delivering capital to your merchants based on their transactions rather than years of financials and credit scores. By partnering with an 

 like Pipe, you can easily launch and test new offerings with minimal up-front investment and risk. 

With trust, industry insights, and deep, real-time data, you’re perfectly positioned to become the go-to app for your vertical, and an embedded capital offering is the perfect next step. Now it’s time to decide which services to offer, choose a partner, and take that step! 

Yas Moaven explores the advantages of capital offerings in vertical software, emphasizing customer growth, and efficient financial solutions

Pipe Embedded Capital Solutions

Discover why vertical software companies should launch capital offerings to foster customer growth and trust.

Why every vertical software company should offer capital

Why every vertical software company should launch a capital offering

Digital lending is growing at a rapid pace. Looking ahead, the global embedded lending industry is projected to achieve a robust compound annual growth rate of 

 from 2022 to 2029. By 2030, the entire embedded finance sector is projected to reach a value of 

These forecasts make it clear that something is shifting. As more customers come to expect convenience and ease in conducting business, embedded lending is evolving and becoming the next big era of finance. Those who don't seize the opportunities in embedded lending risk becoming irrelevant and losing customer loyalty as competition heats up.

Fintech startups and even non-financial companies are jumping into embedded lending, shaking up the traditional banking sector. This new way of doing things is forcing regulated banks to rethink their strategies and adapt.

In this article, we’ll look at the benefits of embedded lending and its future impact on banking. Before we get into that, let’s go over some of the basics.

Find out how embedded lending can grow your GPV and increase the lifetime value of your customers.

Find out how embedded lending can grow your GPV and increase the lifetime value of your customers while improving their experience on your platform.  

Tools and Resources

Discover Pipe's Partnership Ecosystem

Transforming Payfac Ecosystems with Embedded Capital

The Evolution of Embedded Finance: A Leap Towards Unified Commerce

Innovating at the Intersection: ISVs and the Future of Embedded Finance

Empowering Growth: How Payfacs Can Leverage Embedded Lending

How to unlock financial data as a growth tool, no matter your business size

How to optimize security in embedded finance

How the Payments Industry Can Leverage Personalization to Grow GPV and Loyalty

Why every vertical software company should launch a capital offering

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Tools and Resources

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