Insourcing Versus Outsourcing In Merchant Payment ProcessingSource: TSYS Acquiring Solutions
Insourcing and outsourcing are long-established business models. The models are numerous and varied in approach, and many industries have been very successful for their customers who outsource. For others, insourcing is not only the normal practice, but competitively superior.
Outsourcing does not always work, though. Companies have attempted to outsource accounting and finance, human resources and legal functions, but the risks of moving these support groups outside of the company are just too precarious. Although it would provide a marginal financial benefit, the loss of control, lack of responsiveness and missing loyalty are too important to risk.
The payments industry has not fundamentally changed in 60 years. The transaction is the same — goods and services are moved from a merchant to a consumer, the bank pays the merchant and the consumer pays the bank — only credit and debit cards have replaced cash and checks as accepted forms of payment.
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