A new report says nearly every company offers embedded payments, yet most struggle to run them. The risk is that costs grow as fast as sales do.
Putting payments inside a software product is no longer the hard part. Running them as they grow is. A PYMNTS Intelligence report, produced with WEX, found that 99% of surveyed companies offer some form of embedded finance, and 93% say they have trouble delivering it.
Embedded payments means a product that is not a bank lets customers pay or get paid inside it. The report says the setup that gets the feature live may not be able to run the business the feature creates. The trouble spots it names are technical integration, compliance, security and strategic alignment.
Each new payment method, banking relationship or market can bring another connection to build, another process for handling exceptions and another compliance requirement. These costs rarely arrive together. A feature that began as a way to keep customers or add revenue can turn into a full financial operation.
If a program leans on custom work and manual fixes, it can get expensive even as transaction volume rises. The report separates transaction growth from profitable growth.
API-first systems, which connect software through standard links, can make the first launch simpler. The report says that alone does not make a system ready to scale. It points to modular design, standard integrations and risk controls that can adapt, so each expansion is not a separate engineering project.
The goal is not to build every feature at once. It is to add new ones without rebuilding the base. Spending more on flexibility early may cut later migration costs. The report adds that this only pays off when expected growth and complexity justify it.
About 70% of companies outsource at least part of the work. That can reduce the need for in-house expertise. It also ties a business to a provider's pricing, reliability and ability to support growth.
One example is REPAY's virtual card partnership with WEX. According to WEX, REPAY's credit line grew fourfold within 18 months. Virtual cards also helped speed up onboarding and added rebate revenue.
If your product adds payments, plan early for new markets and rules so the cost of running them does not rise as fast as sales.
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