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White Label Payment Gateway Solutions vs. Traditional Payment Solutions

The payment gateway business is a very competitive one. The margins are really thin; it’s common to see start-ups coming up with white label payment solutions to provide their clients’ merchants with a turnkey package to get started in online payments.

These white-label payment solutions are generally cheaper than traditional payment gateways, but they do not provide OCCP (online credit card processing), active merchant accounts, or perks like recurring billing.

Let’s look at both the traditional payment solution providers and white-label payment solution providers to identify their pros and cons.

Traditional Payment Solution Providers:

The traditional payment solutions are developed with in-house developers who have full control over development, functionality enhancement, etc. 

The merchant is provided with a ‘turnkey package’ to help them launch their business. Thus, the payment solution company earns from the commission on every transaction done by the merchant; the merchants have access to all reports and billing information.

In some cases, traditional payment solution providers offer specialized schemes or services to their merchants according to their needs. For example:

  • Some providers may provide a dedicated account manager to help the merchants get started with their business.
  • In some cases, the provider may also offer OCCP (online credit card processing) or even an active merchant account.
  • In recurring billing schemes, traditional payment solution providers have a very clear-cut billing solution, which can also be offered to their clients as a part of the package.
  • In some cases, the provider may even allow merchants to customize their payment pages according to their needs.

Advantages of Traditional Payment Solutions:

The advantages that traditional payment solutions hold are the following:

  1. All reports and billing information are available to the merchants.
  2. “Direct Business Model”– the business does not rely on other parties for revenue.
  3. Full control over development, functionality enhancement, etc.
  4. They can provide specialized schemes or services according to their merchants’ needs.

Disadvantages Of Traditional Payment Solutions:

Some of the cons that traditional payments solutions offer:

  1. High investment cost in development – customized development is expensive.
  2. Time is taken for the launch of the business.
  3. No access to the source code.
  4. The merchant cannot modify or customize according to their needs.

White Label Payment Solutions: 

The white-label payment solutions are the turnkey package for merchants with access to all reports and billing information. However, their business is reliant on ‘other parties.’

White label providers develop the solutions and target small merchants in emerging markets that sell low-priced products online. 

Advantages Of White Label Payment Solutions:

The main advantage of the white label solution is:

  1. Low Rates— Low fees compared to traditional payment solutions.
  2. Quick Launch— Fast integration and support for small merchants.
  3. Turnkey Package— Ready-made plug-and-play packages that can be customized as necessary and help quickly deploy the merchant’s online business.
  4. Inexpensive— Cheap to buy, and the merchants can pay less when compared to traditional payment solutions providers.

Disadvantages Of White Label Payment Solutions:

The cons are listed below:

  1. Lower quality of support since there is no direct link between the white label solution provider and the merchant.
  2. There is no access to the source code, so there is no flexibility in modifying or customization of the package.
  3. Since third parties develop them, they may not be as secure as traditional solutions with built-in security technology and systems.
  4. No specialized schemes or services are available.

White Label Payment Solutions & Clients:

The clients of these white label payment solutions are either merchants getting ready for e-commerce, banks that want to offer their customers a payment option online, or new e-commerce businesses that need to handle their security and risk issues.

In addition, some of the traditional payment solutions providers may be offering white-label solutions to some of their clients.

Generally, businesses prefer traditional payment solutions as they control development and customization according to their needs. But with the advances in technology, the business model has changed over time, and White Label Payment Solutions are gaining popularity. 


Both Traditional Payment Solutions and White Label Payment Solutions are great with their personalized benefits. 

The white-label payment solutions are highly popular since they provide low rates and quick launch times. 

The traditional payment solutions providers generally target larger and more established merchants who sell high-end products online and require a much steeper customization and development learning curve than the white label solutions. Whether you opt for a traditional payment solution or a white label solution, one should identify their needs to understand what they want from the online payment solution.

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