Why integrating payments needs aggregators

Embedded banking will not fulfil its promise without aggregators. This article explains why.


min |


February 2023


Integrating payments into websites is simple. Even moderately experienced developers can do it in days and for off-the-shelf Ecommerce software, no technical work is required at all.

We are talking about Ecommerce websites accepting payments. If you are a marketplace or ERP, accounts payable or procurement software provider who needs to automate making payments, integration is not so easy.

Embedding payments has important benefits for these businesses as described here but it is estimated that embedding banking can take 12 - 18 months, cost up to $2.5 million and another $1 million a year to maintain.

What’s worse, this has to be repeated a few times because single sourcing is risky and there are no providers with global coverage for all services.

So what explains this difference and what can be done about it?

Why making payments is different

One reason for the difference is that payments acceptance for websites has been around for almost 20 years while embedded banking has been around for only about 3 years.

This relative immaturity however only explains a small part of the difference.

The second reason is the need for customisation. Every website has a similar checkout experience but every marketplace or ERP, accounts payable or procurement software has its own payout process. This means embedded banking APIs cannot provide many pre-built components.

A third reason is that making payments requires holding a deposit to fund the payments. That is why it is often referred to as ‘embedded banking’, not just ‘embedded payments’. Managing balances and statements brings another layer of complexity, both technically and also from a compliance perspective.

The final reason is support. If a payment fails, the person being paid will usually contact the platform responsible for making the payment. That is why a support portal is required when integrating making payments, not when integrating receiving payments.

The role of embedded banking aggregators

Embedded banking aggregators allow platforms to solve these problems.

Aggregators are companies that are pre-integrated to a network of embedded banking APIs and offer value-added services on top.

Their network offers their customers global coverage and a wide range of payment methods. It also allows platforms to easily switch should one embedded banking provider have technical issues or should another provider offer lower costs or higher rebates. They can also provide advice to make sure the platform meets financial regulations.

The value added services are designed to make integration and support easy. This usually means payments can be launched in weeks and switching can be done in days.

Aggregators usually specialize in specific sectors to allow them to tailor their value added services to the needs of their customers.

About Yordex

Yordex was a spend management platform with payments that became an embedded banking aggregator for marketplaces and ERP, accounts payable and procurement software providers.

Our background gave us a rich set of value-added services. First hand experience with being the customer of embedded banking APIs made us appreciate the value of multi-sourcing.

To find out more, please contact us.

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