What is Merchant Boarding? An Overview of the Onboarding Process and How to Make it Better

Merchant Boarding

Getting as many new, high-quality merchants as possible signed up for payment processing services is the key to success for independent agents, independent sales organizations, and payment processors alike. But many would-be merchants are hesitant to get started due to an inherent lack of understanding of how the entire process of getting signed-up works. Instead, they go to third-party providers like PayPal and, as a result, end up with higher fees and larger monthly bills than necessary. A good understanding of how the merchant sign-up – or boarding – process works is important to the merchant recruitment process, and sometimes a refresher for ISO’s and independent agents can go a long way towards ensuring the best possible service is provided to each merchant during recruitment. This article aims to provide that refresher, covering the relationship between the different levels of the payment processing food chain, the merchant boarding process itself, and some of the technology currently available to make boarding a faster, smoother process. 


Understanding the Relationship Between Credit Card Companies, Payment Processors, Independent Sales Organizations, and Merchants

To begin understanding boarding, it’s important to understand how each piece in the overall payment processing puzzle fits together. At the top of the food chain are the credit card issuers – Visa, Mastercard, American Express, etc. These companies issue the actual cards and handle the brunt of the risk involved in issuing and processing credit transactions. But there are millions and millions of merchants the world over processing transactions through these cards, and Visa definitely doesn’t want to provide the services or payment infrastructure necessary to work with each one. That’s where payment processors come in. 

Payment processors like BAMS, Vantiv, TSYS, Fiserv, and the rest provide the actual digital infrastructure, systems, and support necessary to process credit card transactions, and they represent the second tier in the overall chain. Theoretically, merchants can sign up directly with these payment processors in order to obtain payment processing services, and some do. But these processing companies also have a small army of companies reselling their services and working on their behalf – these are independent sales organizations. Many, if not most merchants sign up for payment processing via an independent sales organization, and the process of signing-up and loading those merchants to a payment processor through the ISO is known as merchant boarding or merchant onboarding.  


How the Merchant Boarding Process Works

The first step in merchant boarding is for an ISO to establish a connection with a given payment processor’s boarding system. This can be done manually through web-based boarding portals that ISOs can log in to, or it can be done automatically through an API integration included in a program like IRIS CRM, the payment industry’s leading customer resource management platform. Once a connection has been established, an application can be submitted. Applications provide all of the relevant data that payment providers need in order to make a yes or no decision on taking on a new merchant. Those details include company information and documentation, details or the merchant’s business, know-your-customer (KYC) documentation, nodal account documentation, and more. 

Once an application has been submitted, the payment processor will decide whether or not to accept the new merchant, and that decision-making process essentially comes down to whether or not the processor finds the new merchant trustworthy, and whether or not they think the potential revenues the new merchant will bring in offset the risk of taking on a new account. The merchant boarding process can be extremely quick if the merchant’s application and documentation are fully in order, and if the independent sales organization handling the boarding process makes no errors in the submission process. Unfortunately, when something goes wrong in one of those areas, it can often result in bottlenecks that can slow the process significantly and unnecessarily. 


Tools Available to Enhance and Improve Merchant Boarding

Luckily, there is now technology available that can make the merchant onboarding process much easier for both the merchant and the independent sales organization, while also ensuring the highest possible chances of successful application acceptance by the payment processor. As previously mentioned, IRIS CRM provides a fully integrated and automated connection between the CRM platform and the merchant boarding portals of the major payment processing companies. That integration bypasses the need to utilize the payment processors’ online boarding portals and enables the entire boarding process to be performed from within the CRM. That offers some major advantages. First, it doesn’t require ISO agents to manage multiple systems or accounts, simplifying boarding and eliminating the need to transfer data manually between two different systems – an error-prone process at the best of times. Second, it enables ISO agents to take advantage of TurboApp, IRIS CRM’s advanced automated boarding application. 

TurboApp takes digital merchant applications and automatically pulls the majority of the relevant data into the system’s boarding interface, auto-populating as much information as possible while simultaneously validating the fields to ensure the data entered matches the boarding system’s expectations. That automated data handling both reduces the amount of time it takes an agent to handle a boarding application and significantly reduces errors by eliminating as much manual data handling as possible – a common source of error and denied applications. With TurboApp handling most of the onboarding system’s data field entry, all the agent has to do is verify and upload the secondary documentation, verify the accuracy of the application, and send it off. That enables agents to handle boarding over four-times faster and to increase their boarding capacity by up to 500%. Most importantly, it helps ensure that application errors or omissions don’t undercut the success of an application, resulting in a faster approval process for the merchant, and a faster start to the residual collection for the ISO. 

For more information on the complete boarding process or on how IRIS CRM and TurboApp can help your independent sales organization execute it more accurately, efficiently, and effectively, contact us. The IRIS CRM support team would be more than happy to answer any of your questions, to help you schedule a free guided demonstration, or to get you started with a fully-functional free trial of the platform today. 

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