The Road to Payment Facilitator Guide
How Software Providers Can Scale Faster with PayFac as a Service
In this webinar summary, you’ll find key insights that successful software platforms follow to become payment facilitators—without building everything from scratch.
Want to Watch the Full Webinar?
What is a Payment Facilitator?
Definition
A Payment Facilitator (PayFac) is the “master merchant” on your behalf—underwriting and processing payments for your sub-merchants under one account. Unlike a traditional referral model (where you redirect merchants off your platform), PayFac allows you to embed onboarding, authorization, and settlement natively in your UX.
Strategic Benefits
More control over your payment experience and revenue.
- New Revenue Streams: Earn processing-fee margin on every transaction.
- Brand Control: Fully branded checkout and portals keep your logo front and center.
- Customer Insights: Real-time transaction data fuels analytics, personalization, and upsells.
Reality Check
Building Payment Facilitation in-house is complex and costly.
- Time: 6–12 months of approvals, legal work, and compliance build-out
- Cost: $500K+ up front; $100K+ per year on audits, renewals, and specialists
- Risk: Ongoing PCI, KYC/AML, and fraud workflows divert engineering and legal resources
The PayFac as a Service Advantage
What is PayFac as a Service?
PayFac as a Service (PFaaS) lets you plug into a full PayFac’s master merchant account via modular APIs—so you get underwriting, compliance, and tech without building it all yourself.
It’s important to note PFaaS means something a little different from processor to processor, keep reading to learn how Xplor Pay’s modular approach changes the game.
Key Differentiators
Payment Facilitation without the heavy lifting.
- Faster Time-to-Market: Go live in weeks, not 6–12 months.
- Modular Solutions: Pick and choose the solutions you want to use to scale
- Managed Compliance: Continuous KYC/AML, PCI updates, and network registrations handled for you.
The Xplor Pay Experience
Leading vertical SaaS Platforms are choosing PayFac as a Service by Xplor Pay because we:
- Offer a stepping stone set of solutions focused on balancing risk and reward.
- Offer key white-label solutions so that your brand can remain front and center.
- Provide you a consultative approach from day 1 so that you have a clear path to Payment Facilitation.
Key Quote from the Webinar
PayFac as a Service lets you look like a PayFac externally without carrying the huge setup and operational burden of a true PayFac.
Tom Bidell, CEO, Xplor Spot
What Vertical SaaS Platforms Need to Know.
Payment Facilitation vs PayFac as a Service
Payment Facilitation
Payment Facilitators manage the entire payment infrastructure, allowing for quicker merchant onboarding and greater control over fees and customer experience.
PayFac as a Service
PayFac as a Service offers software providers a far less risky and cost-effective approach to payment facilitation via partnership.
6 Factors to Guide Your Payment Facilitation Decision
Use these six considerations to map your priorities—control, cost, speed, and risk—against each payments model.
1
Partnership Model
Decide between referral, PFaaS, or full in-house Payment Facilitation based on your desired control, revenue share, and operational bandwidth.
Solution Requirements
Identify the features your merchants demand—embedded checkout, self-service onboarding, dispute tools—and match them to each model’s capabilities.
2
3
Cost & Risk Profile
Compare up-front investments, per-transaction fees, reserves/holdbacks, and compliance liabilities for each option to build a realistic ROI.
Onboarding Speed
Assess how quickly you need merchants live (hours vs. days and balance speed against customization and branding needs.
4
5
Growth & Scalability
Forecast transaction volume, geographic expansion, and new payment types to ensure your chosen model can scale without re-platforming.
Branding & UX Needs
Determine how much white-label control you require—from co-branding gateway elements to a fully seamless, in-app checkout experience.
6
Four Ways PayFac as a Service Increases Revenue
Grow Attach
Rates
Revenue growth by attaching payments to more customers
Maximize Share
of Wallet
Revenue growth by maximizing payments through your software
Minimize Cost
to Serve
Manage costs while keeping your customers happy and reduce churn
Fine Tune Portfolio Performance
Discover revenue growth and cost management opportunities
Practical Next Steps
Maximizing payments revenue with PayFac as a Service, it’s critical to find your company’s balance between risk and reward.
Assess your risk tolerance
Assess your current resource capabilities
Outline payment revenue goals
Connect with a Xplor Pay Payments Consultant
Watch the Full Webinar Recording
The Road to Payment Facilitation: Scaling with Embedded Payment Partnerships
Embedded payments come in different forms, referral partnerships, hybrid models, PayFac as a Service (the latest buzz), and full blown Payment Facilitation. Each with their own benefits and level of control over the customer experience.
So which is right for you?
In this webinar we will navigate the path to embedded payments success through an open discussion with vertical software leaders Dental Intelligence and Xplor Spot.
Want to Watch the Full Webinar?
