Payments as a platform: Why are they the future of payments

Payments as a platform can help your business scale while remaining agile. But how do they work, and what services do they offer?

Have you ever worked for a startup — or started one yourself? You know that their small size has one advantage: agility. But as a business grows, so does its tech stack. Now that you’re on the enterprise side, you may notice that your legacy systems are holding you back. And while large enterprises enjoy plenty of advantages, agility isn’t always one of them. Even in a narrow area, such as payments, you can have multiple integrations that slow you down and ultimately affect your bottom line.

That’s where payments as a platform comes in. These systems are global, yet agile; scalable, yet customizable — and they represent the future of payments.

What is a payment platform?

A payment platform is a service that acts as a one-stop-shop for a business’s payment needs. Rather than using separate vendors for the shopping cart, payment processing, security, compliance, and other payment services, payments as a platform groups multiple services under one provider. One common payment platform definition is a company that acts as a payment gateway, payment processor, and merchant account, like PayPal.

This graphic shows how platforms like PayPal streamline your payment stack. The great payment platforms even provide services beyond payment processing.

Mobile payments as a platform

Mobile payment platforms are those that allow a business to accept payments from shoppers using smartphones. Many businesses think this simply means accepting digital wallets, however, mobile payments as a platform includes the optimization of the entire payment experience for mobile devices. This means that a platform not only accepts digital wallets, but also optimizes the credit and debit checkout experience, offers one-click payment options, and has the ability to save information for easier mobile checkout, among other services. Considering that smartphones generate 63% of global online shopping orders,1 this is an area that future-ready enterprises shouldn’t ignore.

What does a payment platform do?

The payments as a platform model aggregates many of the services businesses need into one integration. The great payment platforms cover the following areas.

The payment gateway

The payment gateway is where your customer enters their payment information on your website. It passes the information to the payment processor, then returns an approval or a decline to the customer. By making the customer-facing part of the sale as frictionless as possible, for example, by providing a fast, easy checkout on any device, your payment gateway could help you reduce cart abandonment.

Payment methods

Your available payment methods can have a big impact on your sales: In one recent survey, 59% of respondents said their customers have frequently abandoned a shopping cart when their preferred payment was unavailable.2 Payments as a platform can help you capture every conversion by offering a variety of modern payment methods including digital wallets, Venmo, and buy now, pay later (BNPL). With PayPal, you won’t even have to integrate a separate BNPL platform: Our Pay Later solution is included in PayPal Checkout.

Payment processing

The payment processor is the service that sends the payment information to the associated banks and card networks, then returns it to the payment gateway. It takes only a few seconds, but there’s a lot going on behind the scenes. A FinTech payment platform that optimizes routing to provide fast, reliable transactions, retries failed transactions, and leverages unique, fresh data can help boost your approval rates while reducing fraud.

Saved payments and recurring billing

Complicated checkouts can be a barrier for customers: 55% of surveyed business decision-makers agree that their biggest customer experience challenges stem from too many steps to complete checkout and modernizing the checkout experience.3 A platform that can securely save and automatically update customer payment information, and that allows you to set up recurring billing, can go a long way toward streamlining the checkout experience — and could encourage repeat purchases.

Risk management

Fraud is a big concern for enterprises: In one study, the organizations represented lost an average of $3.7 million per year due to fraudulent online transactions.2 By providing built-in risk management tools, particularly those that leverage machine learning and real-time analysis, payments as a platform can help organizations mitigate fraud. Payment platforms should also be Level 1 PCI DSS compliant, the highest industry standard, and provide chargeback protection.


Many traditional payment processing models don’t include payouts, but when they are seamlessly integrated in payments as a platform, businesses can benefit. Whether you need to pay insurance claims, disburse rewards and prize money, or pay marketplace sellers, integrated payouts can give you more control of the experience and workflow, easing operational burden and costs.

Transaction management and reporting

Payments platforms for businesses shouldn’t just approve or deny a sale, then call it a day. They should allow you to easily track and manage your transactions, settle disputes, and leverage concrete data and robust reporting to make business decisions, all in a single integration. That can help you save time and unlock new efficiencies.

Modular integration

With all that functionality, it may seem like integrating payments as a platform is time-consuming and complicated — but it doesn’t have to be. Top enterprise payments platforms like PayPal Braintree allow you to easily connect with your preferred partners, customize your integration methodology with dev-friendly SDKs and APIs, and turn on only what you need, when you need it. And they’ll be backed up by comprehensive, white-glove integration support.

Benefits of payments as a platform

Payments as a platform provides many of the features and solutions enterprise businesses need, in a single, easy-to-manage integration. That leads to plenty of benefits, including the ability to:

Make better business decisions

When you work with multiple gateways, processors, and service providers, it can be challenging to gain a comprehensive overview of your payments ecosystem. If there’s a problem, you can waste valuable time figuring out which vendor to contact, and even more time getting it fixed. With a single payment platform integration, you can see what’s happening and where, down to the transaction level, so you can make data-driven decisions based on the big picture.

Streamline operations

Multiple vendors can also waste resources because each one requires its own training, management, processes, and updates. Payments as a platform offers a simplified, unified infrastructure you can customize to your business: Keep using what works, while adding even more functionality. When everything works together seamlessly, you uncover new operational efficiencies. That could be why Forrester estimated a 401% return on investment and benefits PV $4.2M, for a composite merchant with PayPal’s enterprise payment platform.3

Encourage customer loyalty

Payments platforms for businesses actually have an even more important end user: the customer. If your platform doesn’t provide a fast, frictionless, and consistent buying journey across channels and markets, customers may look elsewhere. Yet an experience that gives customers the payment methods they may want, minimizes the steps and clicks required, and provides speedy and accurate approvals could make a lasting, positive impression that keeps them coming back. Both PayPal and Venmo provide proof: PayPal brings 17% more repeat buyers,4 and Venmo can increase repeat purchases by 19%.5

Scale with agility

In today’s constantly changing ecommerce and economic landscape, perhaps the biggest reason that payments as a platform are the future is their ability to scale, yet remain agile. Your payments platform shouldn’t just offer payment methods that are currently popular — it should keep up with how payment preferences are changing. It shouldn’t just scale across new markets — it should allow you to operate with localized expertise on a market-by-market basis. And it should open new revenue channels that can help your business grow.

Leverage payment expertise

Payments as a platform are more than a “set-it-and-forget-it” solution — they’re a provider that can help you drive conversion, top-line growth, and revenue in a variety of new ways. PayPal, for example, has decades of experience in the payment industry. We’ve helped businesses through multiple recessions and challenging economic cycles. We also have a built-in network of 432+ million active global accounts and processed 5.6 billion payment transactions in Q3 of 2022 alone,6 providing us with valuable and unique data and expertise that we share with our enterprise customers.

Embracing the digital transformation with online payment platforms

As the digital transformation moves beyond retail and payment technology trends begin to affect nontraditional industries, more and more enterprise businesses are likely to realize the benefits of payments as a platform. For example, the healthcare industry may need to respond to disruptions to its long-standing processes, like telemedicine, online pharmacies, and wellness apps. The insurance industry may want to modernize its payments and improve customer satisfaction. Grocery and food delivery may need to respond to changing customer preferences, like contactless payments and curbside pickup.

Even in the retail industry, which has led much of the digital transformation, there are plenty of opportunities for improvement. Payment methods like digital wallets and Venmo can help retailers reach the next generation of shoppers, while simplified checkouts can improve the customer experience: Checkout via “buy” buttons saves consumers 148 million hours each year when checking out online.7 And while many enterprise retailers already offer BNPL, as its popularity continues to rise, it may be smart to reevaluate your options and ensure you’re maximizing your revenue in this area. Only PayPal Braintree offers Venmo, PayPal Pay Later, and other popular payment methods in a single integration.

The future of payments as a platform

Ever since software as a service (SaaS) came on the scene, “as-a-service” companies have proliferated. There’s desktop as a service (DaaS), banking as a service (BaaS), and of course, payments as a service (PaaS), sometimes called payment platforms as a service. Businesses may be enticed by these subscription-based software models, but should keep in mind that the great payment platforms offer the same agility and customization, with additional benefits. That’s one reason the future of payments is the full-service payments as a platform model.

The future isn’t just bright for payments as a platform, but for the businesses that use them. A platform like PayPal Braintree can help you not only modernize your business for the current environment, but also predict what’s next — and then quickly adapt. Every industry can benefit from that. Find your industry on our solutions page to see what we can do for you.

Was this content helpful?

Related content

Sign up to stay informed

Share your email to receive the latest enterprise updates, top stories, and industry reports.

*Required fields

We use cookies to improve your experience on our site. May we use marketing cookies to show you personalized ads? Manage all cookies