The Pros and Cons of Using a Payment Aggregator for Your Business

In 2023, eCommerce represented about $5.8 trillion of total retail sales, and that number is only expected to go high every year. Being capable of streaming business online authorises you to connect with a large number of customers while lowering your overhead fee of renting space and paying employees. Yet, to achieve this, you require a reliable way to streamline payments. 

A payment aggregator allows mobile or online businesses to process payments without having a merchant account with a bank. Instead, payments are processed on your behalf by a third party.

Pros of Payment Aggregator

Integrating with merchant accounts can take lots of time and tracking down and providing various paperwork and documents frustrates merchants. On the other hand, setting up an account with a payment aggregator usually needs very little paperwork. It can also take less time for your application to operate, authorising you to start collecting payments immediately. 

Many payment aggregators also offer their services with a low fee. This makes it simple to budget and understand what you'll be paying upfront. Most payment aggregators also don't need a long-term contract so you can easily shop around and find the one that is suitable and matches your needs. 

If you're a newbie business or process a relatively few number of transactions every month, a payment aggregator will be much less effective in the short term than having a merchant account. Because there are no startup fees, this step makes it easy and convenient to get started. 

Cons of Payment Aggregator 

At the same time, it's easy to set up, but it's not as quick to receive your funds. Because the payment first needs to go via your payment aggregator, they have control over when you receive your funds. While most of the funds are disbursed within 24-48 hours, it can take longer in some circumstances. 

Also Read: Choosing the Right Payment Aggregator: A Step-by-Step Guide

Lack of faith in fraud can also have serves consequences for you because the payment aggregator is assuming a fixed level of risk on your behalf. If your account starts indicating fraud, the payment aggregator can place a hold on it, generating an extra level of inconvenience and disturbing you. 

As your business continues to expand, you can expect your fees to grow as well. Many payment aggregators even put limits on how many transactions you can process every month which can hold your ability to expand. 

Conclusion 

A payment aggregator can assist you in getting your business up and going in the digital regime, but it's not typically a perfect solution. This is especially true if your number of transactions is boosting steadily. 

However, if your business is consistent and you want a consistent fee plan to go along with that, a payment aggregator can be a good choice. 

Also Read: The Ultimate Guide to Understanding Payment Aggregators