Until recently, the acquiring industry viewed Google Inc. and other high-tech firms as interlopers in the payments business. Now, acquirers are courting those very companies as potential business partners.
The shift is occurring because independent sales organizations are growing confident that the value of their relationships with merchants will become apparent to the new players. Besides, it’s useless to resist the march of technological change.
One sure sign of the transition is on display at the Electronic Transactions Association, a Washington-based trade group for ISOs, processors and acquirers.
A successful push to persuade tech companies to join the association represents the biggest change the group’s new CEO, Jason Oxman, has seen in his brief tenure. In just three months with the organization, he has managed to help bring Google and other tech firms in as members.
“One of the things I’ve been focused on since my arrival is in implementing a strategy our board chairman Eddie Myers likes to call 'expanding the tent,' ” Oxman says.
Persuading tech companies to join the association could represent an early step in forming relationships between those companies and ISOs, he says.
“When we bring technology companies into ETA and expand our activities around new payments infrastructure, we do so with the goal of creating new business opportunities and fostering business connections for our member companies,” says Oxman.
Association members treasure networking opportunities, he says, noting that surveys at the Electronic Transactions Association Annual Meeting & Expo indicate that’s the No. 1 reason for attending the trade show.
Besides Google, tech firms that have joined the association in recent weeks include all four mobile carriers, AT&T, T-Mobile, Sprint and Horizon; Neustar, the company that maintains the database of all cellular phone numbers; Panasonic; and Ericsson, which builds infrastructure for cell phones.
In addition to enrolling tech companies, the idea of expanding the tent includes exploring business issues and lobbying government for policies related to new technology, Oxman says. Facets of new technology that have captured the association’s attention include mobile payments and the nation’s switch to the EMV chip-card standard, he says.
Keeping up with technology keeps the association the “hub of activity for the payments industry,” he maintains.
Staying current with technology also benefits ISOs, which account for more than half of the companies that belong to the association, Oxman says.
“We would encourage our ISO members to look at new technology … not as a threat but as a growth opportunity,” he says. “One of the most exciting things about the payments industry is the way in which it embraces new technology.”