What Are ISO Payments? A Quick Guide

What Are ISO Payments? A Quick Guide

Independent sales organizations (ISOs), also known as MSPs in the Mastercard world, are third parties that act as a bridge between merchants and payment processors (who are themselves often another bridge to the banks that offer merchant accounts.) ISOs partner with multiple payment processors and resell their payment processing services to merchants, along with a variety of other value-added services. 

On the processor side, ISOs perform two primary functions:

  • They spread the workload, allowing payment processors to work with thousands upon thousands of individual merchants — something that would be impossible if they had to do everything themselves. 
  • They spread the risk, taking on a portion, however small, of the responsibility for each merchant and thereby reducing at least some of the exposure for the processors.

But ISOs don’t just offer value to the processors. They also offer a lot of value to merchants, ranging from ease of application to rate availability to quality of service, and beyond. 


Why Work with an ISO for Payment Processing?

Merchants gain a lot from partnering with an ISO for their payment processing, and in many cases, the payment processors themselves would be unable to match what a good ISO can offer. Generally speaking, most merchants don’t have access to direct relationships with processors, but even in cases where large merchants could partner directly with a payment processor, going with an ISO is still often the better choice. 

Improved Payment Processing Logistics:

First and foremost, working with an ISO makes everything about payment processing easier, right from the initial setup. Because ISOs work with multiple payment processors, a merchant can submit a single application and let the ISO handle the work of submitting that paperwork to as many different processors as necessary. 

Most ISOs also offer value-added services covering everything merchants need to do business, from in-store hardware to online gateways and beyond. Working with an ISO eliminates the need to work with and manage a small handful of vendors, instead allowing the merchant to cover all of their payment processing needs in one place. 

Lower Payment Processing Rates:

Not all payment processors are the same, and because transaction fees apply to everything a merchant sells, variations in payment processing rates are an important consideration. A merchant opting to work directly with a payment processor has access to only one set of rates. A merchant working with an ISO has access to the complete gamut of rates from all of the ISO’s partners. 

More choice generally means a better deal. So, by working with an ISO, merchants can rest assured that their payment processing needs are being met at the best rate possible and that profits won’t be chipped away needlessly by overinflated fees. 

Better Payment Processing Service and Support:

Service matters, and it’s undeniable that it’s easier to get great service from a small company than from a giant behemoth where every customer is just a number. Payment processors work with thousands of individual merchants, and providing personal, one-on-one attention to any one of them is a big drain on time and resources. ISOs, on the other hand, have much smaller client rosters and often differentiate themselves on the quality of personalized service they provide. 


Choosing the Right ISO Payment Processing Services

With so many options on the market, choosing the right ISO can be a challenge. The following are four tips merchants can use to narrow down the field and ensure they get the best payment processing services at the best price. 

  1. Look for the premium partners: ISOs often have half a dozen or more payment processing partners, and the more blue-chip processors they work with, the better. Names like TSYS, Fiserv, Elavon, Paysafe, and other top-tier processors lend credibility. 
  2. Remember that price alone isn’t enough: Fees matter, it’s always a good idea to shop around to minimize them. But, remember that fees aren’t everything, and sometimes paying a little bit more for better service and better value-added features is more than worth it. Merchants should consider the totality of an ISO’s offering in addition to just rates.  
  3. Consider a specialist: Specialist ISOs work in narrow niches to maximize industry knowledge and the quality of service and support they can offer to merchants. Merchants operating in highly specialized fields might be well-served by a specialist payment processing partner, and it’s worth doing some Googling to find out if the option exists. 
  4. Choose a partner that offers value-added technology: Technology is a driver of success in all industries, including payment processing. Some ISOs enable merchant success by offering value-added technologies at little-to-no extra cost. For instance, gaining access to a customer resource management platform for reporting and analytics can change a merchant’s understanding of their payments and finances. Merchants should look for ISOs that offer those kinds of high-value tech carrots. 


IRIS CRM is the payments industry’s top customer resource management system. It offers ISOs and their merchants a multitude of tools designed specifically to enhance and streamline payment processing, including advanced reporting and analytics, a white-label merchant portal, and much more. 

To find out more about everything IRIS CRM can offer your business, click here to schedule a free guided demonstration today.

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