Picture one invoice moving through your platform. Your software created it. Your customer sent it to their customer. When it gets paid, a processor you probably don’t think about much takes a cut of the transaction.
You built the rails. Someone else collects the toll.
For many operating companies across Constellation Software and Jonas, this is simply how payments have always worked. It deserves a second look, because the business you run today is not the business that originally made that call.
How the leak happens
Nobody sets out to give away payments revenue. It usually happens one reasonable decision at a time:
- A customer asked to take cards, so you added a referral link to a processor.
- Another customer already had a merchant account, so you supported “bring your own processor.”
- An integration got built that hands off to a third party the moment money starts moving.
Each of those choices solved a real problem at the time. Taken together, they mean the most frequent and most valuable thing your customers do inside your software happens on someone else’s terms.
It’s not just revenue
The transaction fee is the obvious part. The less obvious costs tend to matter more over time.
Data. When payments run outside your product, you might see that an invoice was marked paid. You don’t see how your customers’ customers prefer to pay, where payments stall, or how cash actually moves through the businesses you serve.
Visibility into customer health. Payment activity is one of the earliest signals of how a customer’s business is doing. Without it, you often find out an account is struggling when they ask to cancel.
Stickiness. Once a business runs its money through a platform, leaving gets harder. Reconciliation, reporting, and payment habits all tie back to the system. When payments live elsewhere, that retention lever belongs to someone else.
For businesses that think in decades rather than quarters, which describes most of the Constellation family, those long-term costs deserve as much attention as the fee line.
Why it’s been tolerated
There was a good reason to leave payments alone. Bringing payments in-house used to mean becoming a payment facilitator yourself: registering with the card networks, taking on underwriting and merchant risk, building a compliance program, and staffing support for questions your team was never hired to answer.
For most vertical software companies, that was a distraction from the core product. Sending customers to a processor was the rational call. The tradeoff made sense when becoming a full PayFac was the only alternative.
What changed
It isn’t the only alternative anymore. With a PayFac as a Service model, a software company offers payments as part of its own product while a partner carries the heavy infrastructure behind it: underwriting, risk management, compliance, and the processing relationships.
The software company keeps the customer relationship and the payment experience inside its product. It participates in the economics of transactions it already enables. And it gets there without building a payments company from scratch.
For Constellation and Jonas operating companies, there is one more point worth knowing: this conversation doesn’t have to start with an outside vendor. There are payments teams inside the ecosystem who already understand how vertical market software businesses operate. See how Total Service approached the decision.
Three questions to ask your team this week
- Where does money leave our platform? Map every point where a payment hands off to a third party, including the ones your customers set up on their own.
- Who owns the merchant relationship today? When a customer has a payments problem, who do they call, and who learns from it?
- What would we do with that revenue and data if we kept it? Product investment, better reporting for customers, an earlier read on account health. The answer tells you what the leak is really costing.
None of these questions require a decision. They make the cost visible, which is usually the first step.
Start the conversation
If your operating company is part of Constellation Software or Jonas and these questions hit close to home, the CSIPay team at Constellation Payments is happy to work through them with you. No pitch required, just a conversation about where your payments stand today. Reach us at [email protected].