June Developer Cover Story
Payments Innovation

The New Approach To Association Payments

From bots to shoppable ads, developers are using new tools and technologies to help brands to close the loop by embedding payments inside of every nook and cranny of existing ecosystems. This month’s Developer Tracker highlights how players from Twitter to Messenger and Facebook are using software and payments to create new monetization opportunities.

In the associations space – which includes nonprofits, mission-driven associations and government entities – payments can be a unique challenge.

In many cases, these organizations rely heavily on funds from donors or membership dues, but may not have the resources to manage and/or even collect that money in the most efficient way possible.

In a space where every dollar truly counts, payments are now taking center stage.

Revenue-Generating Payments

As Darryl Hopkins, Director of Product Management at Abila, pointed out, entities in the association and nonprofit space usually aren’t radically different from a brick-and-mortar store or online store when it comes to payments, but there are some nuances.

First off, these types of organizations typically handle a variety of different payments – such as fees from members who are joining or renewing, fundraising donations, event registration costs, purchasing publications or subscriptions, etc.

Though these payments are increasingly being made online, there are also many associations and nonprofits that facilitate these types of payments in-person as well.

Whether card-not-present transactions or face-to-face retail, Hopkins said associations really want to know whom they are receiving money from. For example, they don’t just want to take a payment from a member, they also want to be able to link it back to that particular member’s account so they can keep a rich history of who this actual member is, Hopkins explained.

Being able to recognize and monitor the transactions of a member can actually be helpful in transforming payments into a revenue generating activity for associations and nonprofits.

Abila, a software and services providers for associations, general nonprofits and charities, offers an association management system called Abila netFORUM Enterprise, which is aimed at boosting both engagement and revenue for organizations in the sector.

By identifying the types of services and interactions that may increase engagement with members, the netForum Enterprise solution is designed to also provide additional revenue generation.

“Another big trend with our associations, and we’re supporting this in our various solutions, is members being able to automatically renew,” Hopkins stated.

Accepting payments information from members and enabling them to renew automatically not only improves the overall renewal rate, Hopkins added, but the online payments also result in higher revenue.

Though these payments can be processed much the same way as any eCommerce solution, the use of various membership models that associations may have can sometimes be a challenge.

Hopkins explained that oftentimes an association will add a member that’s actually a standalone organization itself, carrying along its own employees as well. As a result, associations have had to take on more fluid membership models to accommodate these member organizations, basically a collection of individuals, but it can make electronic payment processing a bit more complex.

With an essentially “plug-and-play” setup and process, Hopkins said the netFORUM Enterprise solution supports the hybrid membership models more associations are moving toward and enables individual members to handle their own payments and accounts online.

“We believe our solution can actually save our associations a lot of time, because all the payments and the reconciliation more or less just happens automatically. A lot less manual processing that they have to go through,” he added.

The Payment Data Difference

Associations and nonprofits are definitely not immune to the shift in both consumer demands and new technologies when it comes to payments. Meaning they must attempt to keep pace, as much as their for-profit counterparts, with the changing payments landscape.

Hopkins said Abila keeps a constant dialogue with clients and partners to identify the emerging technologies and needs they are expecting, but that education plays a very important role in helping to stay abreast of the complex payments industry.

Mobile payments, as well as other alternative payment methods, are an increasingly important area for Abila, Hopkins noted.

However, security and safeguarding transactions remains a top priority.

“The organizations we serve are nonprofits. They take the revenue they generate and reinvest it for their members and their communities. So protecting those transactions is something we take seriously,” he explained.

With this focus comes the desire to also optimize the integrations with the electronic payment gateways of its key processors.

Hopkins pointed out that there are a variety of value-add features that can be offered to associations, such as reducing chargebacks, improving card recycling and strengthening payment card and ACH verification.

Though the chargeback patterns in the association space are not necessarily the same kinds of patterns seen with ordinary consumers, Hopkins said there are still false declines.

Improving acceptance rates can be impacted by a number of factors, including how an association responds to different decline codes or determining whether to try another attempt or just contact a customer service representative about the declined member.

But with extensive historical data about members being captured by a solution, associations can begin making decisions about a member’s past patterns and apply that to some of the more advanced payment processing operations, Hopkins noted.

“We will keep a historical log of any kinds of payments a particular member has made, so you’ll know if they’ve generally been a good customer over the years and you’ll be able to make those kinds of inferences and judgments,” he added.

“And all of these together are intended to increase the acceptance rates of your transactions, reduce declines and rejections and typically just make your operations as smooth as they can be and increase your revenue.”

To download the June edition of the PYMNTS.com Developer Tracker™, powered by Vantiv, click the button below…

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About The Tracker

The PYMNTS.com Developer Tracker™, powered by Vantiv, provides the payments ecosystem with a view into how software developers are using new technologies to create innovative business opportunities and enable merchants to optimize the ways in which they engage with shoppers today. The developer community within the tracker is separated into three categories: Shopping and Payments, Operations, and Marketing.

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Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out our April 2019 Unattended Retail Report. 

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