In recent years, a new class of payment service providers (PSPs) called payment orchestrators has emerged to support merchants in their quest to optimize the customer experience and reduce payment costs. Payment orchestration involves efficiently managing a diverse array of payment methods, providers, and channels through a unified platform, ensuring smooth payment processing for businesses.
Recently, a new class of payment service providers called payment orchestrators has emerged to support merchants in their quest to optimize the customer experience and reduce payment costs. Payment orchestration involves efficiently managing a diverse array of payment methods, providers, and channels through a unified platform, ensuring smooth payment processing for businesses.
👨💻 Merchants are looking to become acquirer-agnostic: For enterprise merchants, having access to multiple payment integrations with acquirers, PSPs, gateways, and other service providers allows them to enhance payment acceptance rates and reduce processing fees. With more options available, they can choose the most suitable provider for specific transactions, optimizing costs and improving payment success rates.
💳 Payment orchestrators are investing in value-added services in an increasingly competitive market: Providers offer a comprehensive solution connecting to hundreds of acquirers, PSPs, and other providers. They can also support more than 350 payment methods globally. Key functionality such as smart payment routing is now table stakes, and orchestrators need to invest in value-added services to differentiate themselves from increasing competition.
🌎 The size of the payment orchestration market will be worth over US$15 billion by 2026: The total addressable market (TAM) for technical payment orchestration was US$9.9 billion in 2022, and it is expected to grow to US$15.2 billion in 2026―a compound annual growth rate (CAGR) of 11%. However, the service-addressable market (SAM) will be highly dependent on the business model and target market for each provider of orchestration services.
🚀 Payment orchestration has strong growth potential: Revenue reported by dedicated fintech orchestrators is less than US$25 million, indicating that this market is still relatively immature given the TAM of around US$10 billion. There is plenty of room for providers to grow.
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