More payment companies are attempting to ease the financial pressures that merchants face in light of inflation and other economic pressures. These can include the very costs of setting up a system for accepting payments.
"Managing upfront costs is vital, especially for new businesses," said Jamie Walker, CEO of Elavon, the payment-processing subsidiary of U.S. Bank.
Elavon is launching a product on Thursday called talech Register, which combines payments and analytics to support a variety of small-business functions. Talech also attempts to slash the cost of deployment by renting out its technology rather than selling it for an upfront fee that can typically range from hundreds to thousands of dollars.
Given high inflation and fears of a recession, fintechs and banks this year have been developing and selling services that offer small businesses options to manage liquidity or wring inefficiencies out of transaction processing, inventory management, staffing and other tasks. Often these take the form of new ways to
Elavon will rent the talech POS systems for $50 per month in the U.S. and $60 in Canada for restaurants; and $40 in the U.S. and $50 in Canada for other retailers. All versions include a point of sale station, a receipt printer, a QR code scanner, a card reader and a cash drawer. The restaurant package adds a kitchen printer.
Such systems can typically cost about $800 for upfront purchase and deployment, according to restaurant technology firm
"It can be helpful to avoid these costs and focus on the long-term," Walker said.
Talech can be set up by the merchant or by Elavon's support staff, who can also help businesses determine which types of services are necessary. "We're looking to simplify the software and not overwhelm the businesses in terms of the number of apps," Walker said.
Elavon's new product is designed to address challenges such as a changing economic climate, but also an expected addressable market of new businesses, Walker said.
As many as 17 million new businesses will be formed in 2022, according to
Talech is the latest in a series of products and services Elavon has made to boost the breadth of its payment and merchant technology as technology-focused payment firms such as Stripe, Block and PayPal have added more financial services such as merchant credit. Elavon's traditional competitors include FIS, Fiserv and Global Payments, which have also gradually added more technology that combines bank technology with merchant acquiring.
Elavon has made acquisitions, including
There's also a payment technology arms race underway. In just the past few weeks, several payment companies have introduced new services or emphasized existing products that are designed to help small businesses manage economic stress.
Payment technology firms such as
Even as companies like Apple make it less crucial to have dedicated payment terminals, Adyen sees a market for two new devices that can build on its strengths in e-commerce.
Small businesses can be hard to serve in a cost-effective manner, said Eric Grover, a principal at Intrepid Ventures. But platforms such as Square (Block), PayPal, Fiserv's Clover and others serve millions of small merchants and directly or indirectly reach millions of consumers, Grover said.
The encroachment of technology firms into small business payments and finance is an "important lesson for banks, which years ago walked away from payment processing services for small businesses," said Richard Crone, a payments consultant. There is an opportunity for banks and fintechs to offer payment and merchant services to small businesses because small businesses don't negotiate "razor thin" margins with processors when compared to larger merchants, Crone said.
By aiding deployment of digital payment hardware and software, banks and fintechs can serve small businesses during the transition to checkout-free retail and the growth of "do-it-yourself" payment acceptance such as Apple's Tap to Pay and related technology that allows Android devices to support payments, according to Crone.
