Better, Faster, and More Secure: Digitizing Utility Payments with Payments-as-a-Service (PaaS)
Utility companies can focus on providing service while their SaaS payments provider makes it easier for their customers to pay them.
Even with the rapid increase in online payments over the last 5 years, the pandemic has perhaps forever changed the way we do business and further accelerated the pace of digital payment adoption. Nearly 50% of global shoppers are using digital payments more than before the pandemic and according to McKinsey & Company, consumers spent nearly 30% more on-line in the first 6 months of 2020 than they did in 2019.
As we detailed in our last blog about making it easier for your customers to pay you, utilities are no longer compared to each other, but rather customer satisfaction is more and more driven by comparison to the trendsetting companies that are leading the digital revolution. If you are not all-in on digital payments at this point then you are falling behind and your customers are going to let you know about it. Ultimately, given that it makes your customers’ experience quick, convenient, and flexible, why would you NOT get serious about digital payments?
If you want to encourage your customers to pay their utility bills online, setting up a digital payment system on your website or mobile app is easy. However, if the world of online payments is new to you, you may not be sure of the best way to go about it. One of the easiest ways to get set up for digital payments is to utilize Software as a Service or Payments-as-a-Service — SaaS/PaaS for short.
Join us as we look at what PaaS is and how it will help your utility company save time and money — vital resources that can be spent on your operations and providing your customers with the best utility service possible.
What is PaaS?
Years ago, if you wanted a particular type of software to use on your website, you had to buy it and install it on your own servers. This type of software is known as ‘on-premises’. Once purchased, installing, maintaining, and keeping it up-to-date is the responsibility of the utility and something that could be a long, expensive, and time-consuming process for your business.
Over the last decade SaaS and PaaS, software that is hosted and maintained in the cloud, has become more and more popular. Think of it like renting rather than buying outright. You pay a subscription to gain access to the software, and because of this, you will always be guaranteed access to the most recent version. Furthermore, maintenance of the software is built-in to the subscription you pay.
Why choose PaaS over an on-premises digital payment solution?
Here are eight reasons why choosing PaaS will give your company an edge.
1. There is no on-site installation or maintenance
If you need to set up online payments quickly or you only have a small IT team, a PaaS solution may be a perfect choice to help get you up and running fast. With no on-site installation and maintenance, your IT costs and resources will be minimized both in the short and long term.
2. You and your customers will always have the most updated version of the software and mobile apps
If you host a payment system on your own servers, your IT team will have to spend time making sure it is regularly updated. If not, it could result in a poor user experience or even leave you vulnerable to cybercriminals (more on that later).
With PaaS systems, your provider will do all of the hard work for you, ensuring that the payment system you have is always the most up-to-date one available. This will be included as part of your subscription, meaning you do not have to pay extra for updates.
If you choose an experienced provider, updates are made using high availability techniques, meaning that customers will not experience any downtime on your website. Both utilities and customers get the benefit of the most recent functionality and the most recent security updates.
Additionally, if you offer a mobile app payment option to your customers, outsourcing the app to your vendor takes away the burden of having to manage the app on your own. Keeping the app up-to-date is as important as the PaaS system itself.
3. Fast Brand integration
Some companies think that an on-premises solution will have a lot more customization options than PaaS. While this may have been true in the past, modern-day SaaS solutions are a lot more flexible and have much more variety.
This means that your company can quickly configure your brand new digital payment system to match the look and feel of your website.
Depending on the solution you choose, you may also be able to integrate your PaaS digital payment system into other software programs you use, like your customer relationship management system. This will help save your staff time and avoid the duplication of tasks.
4. Let your vendor maximize your application uptime
Even the best software applications have little value if they cannot be reliably used and accessed “all-the-time’ or as close to that as possible. Ensuring that you have a solution that maximizes uptime is a large part of the decision-making process for most companies. However, the responsibility for ensuring that uptime is met can be placed on your own internal IT resources or on the vendor.
With Exceleron’s MyUsage Payments solution, we provide greater than 99.99% uptime and we focus OUR resources on ensuring that happens. With on-premise solutions, you either have to provide intrusive access to your internal systems (which are another potential attack point for cybercriminals), rely on your own IT resources to maintain uptime or some combination of both. By adopting a PaaS solution, you are placing the onus for providing maximum uptime on your vendor and also giving them the unfettered control to manage that effectively on your behalf.
5. Greater protection from cyber attacks
As more functionality is made available online, the risks to businesses increase. There is a hacking attack on companies every 39 seconds, with 300,000 new examples of malware created every single day.
A cyber attack on your business is problematic. It can lead to time and money wasted trying to fix the problem, as well as negative publicity and a loss of reputation.
44% of customers are cautious about doing business with a company for several months after a breach, and 41% will never come back. If your data is compromised, the long-term negative impact on your customers’ confidence and satisfaction in your brand can be hard to overcome.
Picking a PaaS vendor that puts an emphasis on security controls is a must. Vendors that have strong security controls in place with robustly audited compliance provided by SOC2 will ensure that your PaaS software is quickly patched as new vulnerabilities are identified. Selecting a PaaS solution puts the responsibility on the vendor to secure and maintain the solution, not you. Good vendors provide great security. This is a tremendous focus for those that have implemented the rigorous controls required by SOC2.
6. Secure processing and data storage of your customers’ sensitive data
Selecting a vendor that meets the highest level of the Payments Card Industry Data Security Standard, PCI DSS Level 1, is critical to ensuring that management of your customers’ personal and credit card information utilizes best practices and is audited by a 3rd-party to ensure compliance. In addition, if you choose to offer ACH payments for your customers compliance with NACHA regulations will be covered by the vendor too. Furthermore, do not store personal data, credit card or bank account information on your own servers — let your PaaS provider handle this for you through tokenization.
If you use a PaaS provider to manage your online payments, they will take care of this compliance on your behalf, giving your IT team one less thing to worry about. This means you can focus on providing great service to your customers and your customers can use your online payment systems safely in the knowledge that their personal data and credit card details will be protected from scammers.
7. Your new PaaS system will grow with your company needs
One of the benefits of PaaS is that it scales easily and quickly. There are no large sunk costs of building out server solutions on-premise only to have to replace them as your application use grows and your performance needs scale. With a PaaS system, you can implement the solution quickly at a small scale and your PaaS vendor will take the responsibility of maintaining performance as your use of the application grows. This scalability is built-in to your PaaS subscription and once again places the responsibility for performance, security, and growth on your vendor.
8. You will get a cost-effective option compared to on-premises software
Does your utility company have a small budget or is just starting out? If the answer is yes, PaaS is a great way to get your digital payment services online without having to drastically amend your IT infrastructure.
Using PaaS means that you do not have to allocate a budget for software, servers, network switches, and staff time to maintain it. With PaaS, you pay a setup charge, a monthly subscription fee, and depending on the service, a cost per transaction.
It’s more essential than ever to offer an option to pay bills and for additional services online. 56% of bills in the US are now paid online, and this figure is set to skyrocket in the years to come. If you currently do not provide digital payments as an option, you run the risk of frustrating your customers.
Implementing a PaaS solution has a wide range of benefits for your company. Not only can you introduce online payments quickly, but the work needed from your IT team to maintain it will be minimal. By placing the onus on your vendor to keep the PaaS solution updated, secure and scalable, you can focus your maximum efforts on providing the best utility service possible for your customers.