FinTech Interview with Mark Bishopp, SVP – Head of Embedded Payments at Fortis
Mark, can you tell us a little about your background and how you came to be the Head of Embedded Payments/Finance & Partnerships at Fortis?
I started my career at PriceWaterhouseCoopers straight out of college and quickly went from Audit to Consulting within the FinServ space – this is back before it was called fintech. After 7 years with PwC, I decided to start my own consulting firm, specializing in the movement of money. During that time – over 15 years ago – I was introduced to Greg Cohen who is now the CEO of Fortis.
I continued my path of becoming an expert in third-party payments while Greg continued his path of leading Tier 1 payments companies. Fast forward to him leading Fortis; I liked what he had been putting together there. After speaking with him, it seemed like a good fit to finally join forces and here we are. Now, I am working to take the Fortis platform and embedded payments business to the next level.
In what ways have payments evolved over the last decade?
Payments are as old as commerce itself; a transaction for goods and services that are too often seen as simply transactional. However, the payments industry has seen a more rapid change with the introduction of fintechs, which has added a layer of strategy to the payments process. The move away from the physical point of sale to “invisible payments” – spurred by fintechs, has been underway for several years. The pandemic moved this forward through the rise of digital and contactless payments. Invisible and contactless payments – also referred to as integrated commerce – are only one part of the larger embedded payments trajectory looking ahead.
What are “embedded payments” and why are they important?
There are several terms like embedded finance or integrated commerce that all point towards two words; seamless and invisible. However, embedded payments specifically make the process of paying imperceptible, allowing customers to make a purchase with just a few – or sometimes zero – clicks.
We went from physically transacting cash and credit to clicking a single button that orders a ride to the airport and pays for it in the same action, enabled by embedded payments. Because of these benefits, PwC projects cashless transaction volumes will reach $1.9 trillion by 2025 and digital payments per person will triple by 2030. Embedded payments offer better customer experiences and a competitive advantage – plus, if leveraged appropriately, a boost in revenue.
How do business leaders view payments today? And do these perceptions reflect how payments and paytech have evolved?
Even though this shift has been in the making for years, many business leaders still view payments and payment processing systems as operational costs or other business expenses. This mindset disregards not only the transformation of payments and the paytech available, but the fundamental direction businesses are headed. Although nearly 73% of business leaders know digital payments are fundamental to business growth and digital processing capabilities are necessary to avoid lost revenue via 41% or higher cart abandonment rates, payments, and paytech are seen as a conventional, yet fungible, part of the business. That and leaders are unsure of how to pursue the switch to digital payments.
What risks come with thinking of payments only as a cost?
The revenue loss, stagnant growth, customer dissatisfaction, and missed opportunities; when payments are only viewed as an operational cost, businesses lose the ability to take their business to the next level. For example, business leaders are less likely to trade in their legacy ERP systems if they don’t see – let alone comprehend – the maximized value their payments system can provide, eventually leading to all the aforementioned risks.
The real-world effects of implementing embedded payments will depend on the specifics of the business, but using embedded payments technology doesn’t just drive profit and prosperity. Specifically, the friction removed from the buying process reduces cart abandonment, resulting in a seamless payments experience that will increase loyalty, efficiency, technology adoption, and the endless growth opportunities to come from the fintech and paytech industries.
What does PaaSA (Payments-as-a-Strategic-Asset) mean for business leaders and what are the added value or pain point solutions offered? Is PaaSA specific to one industry?
The PaaSA approach is not tied to one industry. You may have seen fast, easy checkout processes used in a few popular websites or apps including Uber, Amazon, and Starbucks, but the benefits of PaaSA can extend across all industries and all sizes of organizations. Making payments easier and faster is a win-win for customers and businesses. When working with solutions providers to implement faster, more seamless payments business leaders will experience a better front-end checkout experience and fewer risks because the payment facilitator takes care of payment authorizations, fraud detection, and security.
How can business leaders transform payments and paytech into strategic assets?
Businesses not yet privy to the fintech/paytech world are in an opportune position to consider a strategic partnership that not only supports the business’s tech exposure and transformation but could offer a new revenue stream through features like revenue sharing based on payments volume. An embedded payments strategy can also improve market penetration with the ability to offer more favorable rates or charges than other competitors, which can also improve your profit margins.
This doesn’t just apply to consumer-facing businesses; B2B-focused organizations, such as independent software providers (ISVs) can leverage paytech to multiply revenue, too. With embedded payments, ISVs can integrate and monetize a variety of financial services into their platforms, such as payment acceptance, loans, credit and debit card issuing, installment purchase programs, etc.
What role does PaaSA play in the paytech and fintech industries? Will the rise of AI have any impact on this mindset?
PaaSA will become a necessary standard within any paytech or fintech, especially as businesses continue to demand better payment experience options. Treating payments as a strategic asset will create a better experience, better serve customers and ultimately increase cash flow, and will provide a competitive advantage over those that simply think of payments as a function or cost.
AI will present many opportunities in the financial services sector. AI can offer increased efficiency of daily operations, automation of tedious functions, and increased customer experience. One of the main goals of PaaSA is to increase customer satisfaction. When incorporating payments with AI, this is only enhanced, especially for those that prefer to “self-serve.”
Do you have any further predictions about adopting digital payments, paytech, or PaaSA?
Payments are always evolving and so are customer expectations. Therefore, you should ensure your payment strategy is future-proof and adaptable. In the future, we’ll see a continued desire for businesses to find revenue streams, and payments are still early in the game – about the third inning if we’re thinking in terms of baseball. Those that can provide a true solution with PaaSA in mind will win over all others.
Looking ahead in tech, we’ll see Web3 and blockchain significantly change the payments landscape which is why it’s critical to partner with companies focused on PaaSA and are forward-thinking and adaptable. They also should have the personal relationships to work with regulators, banks, card networks, or anyone else that can influence future direction.
What do you see as the biggest opportunity for Fortis in the next 5-10 years and how do you plan to capitalize on it?
Fortis recognizes the value of hiring experienced payments professionals that truly believe in PaaSA which positions Fortis ahead of every other player in the market today. This is important as it paves the way for future growth, especially with the many moving parts that come with payments. In the future of “online self-service,” it will become even more critical for companies to have talented trusted payments advisors even AI cannot replicate, and Fortis’ professionals are there to meet those needs. With the payments experts we have at Fortis, we are ready to take on any payments, fintech, or commerce trend that comes with the future. Our ability to adapt to trends and meet the needs of our customers is one of our biggest strengths and certainly an opportunity.
By Fintec Buzz | https://fintecbuzz.com/fintech-interview-with-mark-bishopp/