What is the difference between an ISO and ISV?

Independent Sales Organization ( ISO )

ISO with payments typically refers to a company or organization that is authorized to facilitate credit card payments between merchants and acquiring banks (banks that process card payments). ISOs (Independent Sales Organizations) with payments are essentially intermediaries between the merchants who want to accept credit card payments and the acquiring banks that provide the payment processing services.

ISOs with payments typically partner with acquiring banks and payment processors to offer their services to merchants. They provide the necessary equipment and technology to enable merchants to accept credit card payments, and they may also provide other services such as fraud detection and chargeback management.

ISOs with payments can be an attractive option for merchants who want to accept credit card payments but do not want to go through the complex process of establishing a direct relationship with a bank or payment processor. By working with an ISO with payments, merchants can gain access to the necessary technology and services to accept credit card payments more easily and cost-effectively.

Becoming an ISO (Independent Sales Organization) in the payments industry typically involves the following steps:

1. Determine if you meet the requirements: ISOs are usually established businesses with experience in sales and marketing, financial services, or a related field. They should have a solid understanding of the payments industry and its regulations.
2. Register with the card associations: ISOs must be registered with the major card associations, such as Visa and Mastercard, to be able to offer payment processing services.
3. Partner with a payment processor: ISOs work with payment processors to provide payment processing services to merchants. You will need to establish a relationship with a payment processor to become an ISO.
4. Obtain the necessary licenses and certifications: ISOs must obtain licenses and certifications that allow them to sell payment processing services in their state or region. This may involve passing an exam and meeting other requirements.
5. Build your sales team: ISOs rely on a team of sales representatives to market and sell their payment processing services. You will need to hire and train a team of sales professionals who can attract and retain merchant clients.
6. Establish your pricing and contract terms: As an ISO, you will need to establish pricing and contract terms for your payment processing services. You will need to decide on fees, rates, and other terms that will be attractive to potential clients.

Independent Software Vendor

“ISV” stands for Independent Software Vendor. In the context of payments, an ISV is a company that provides software solutions to merchants or other businesses to help them accept and process payments. These software solutions may include point-of-sale (POS) systems, e-commerce platforms, or payment gateways that allow merchants to securely process transactions and manage their finances. ISVs typically integrate with payment providers such as credit card networks, payment processors, and banks to offer merchants a seamless payment experience for their customers. By using the services of an ISV, merchants can save time and resources by outsourcing the technical aspects of payments and focus on their core business operations.

Becoming an ISV (Independent Software Vendor) in the payments industry involves several steps, which are outlined below:

1. Research the market: Before you can become an ISV, you need to research the payments industry to understand the current market, the needs of merchants, and the available technologies. Look for opportunities to create a software solution that will address a gap or solve a problem in the market.
2. Develop a software solution: Once you have identified an opportunity in the market, you need to develop a software solution that meets the needs of merchants. This may involve working with a development team or building the solution yourself.
3. Choose a payment gateway: To process payments through your software solution, you will need to integrate with a payment gateway. Research the available options to find a payment gateway that meets your needs.
4. Test and certify your software: Before you can launch your software solution, you will need to test and certify it with the payment gateway and card networks to ensure that it meets their security and compliance standards.
5. Market your software solution: Once your software solution is ready, you will need to market it to potential customers. Consider attending industry conferences, reaching out to potential customers directly, and creating marketing materials such as whitepapers and case studies.
6. Establish partnerships: As an ISV, you may want to establish partnerships with payment processors, banks, and other financial institutions. These partnerships can help you expand your customer base and provide additional value to your clients.