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Home » Blog » Merchant Onboarding Made Easy: Streamlined Integration for ISVs & Merchants

Merchant Onboarding Made Easy: Streamlined Integration for ISVs & Merchants

  • March 24, 2025

What is merchant onboarding, and why is it essential for ISVs?

Merchant onboarding is the end-to-end process of enrolling a new merchant into a payment system so they can start processing transactions. It typically involves setting up a merchant account with an acquiring bank (merchant acquirer) and configuring a relationship with a payment service provider (PSP) or payment gateway to handle payments behind the scenes. MSG is a one-stop shop for all of these services, which greatly streamlines the overall onboarding experience.  

This process is especially essential for ISVs because integrated payments are often a core part of their software offerings. Your clients (merchants) need a quick, seamless way to get onboarded directly within your application so they can start using your software to accept payments. A fast, secure merchant onboarding process means those merchants can begin transacting immediately, which in turn helps drive adoption and revenue for your platform.

Speed isn’t the only concern – compliance is equally critical. Payment providers and merchant acquirers must perform due diligence on each new merchant to vet their legitimacy and prevent money laundering or fraud. That means collecting and verifying key information about the business and its owners, following customer KYC (Know Your Customer) checks, anti-money laundering (AML) protocols, adhering to Federal Beneficial Ownership Regulations, and the Patriot Act. Industry regulations require confirming details like business identity, ownership, and tax identification numbers.

How does a streamlined onboarding process boost business potential from day one?

A well-designed, streamlined onboarding process can make a dramatic impact from day one. When onboarding is quick and easy, new merchants can start accepting payments immediately – translating into revenue right away for both the merchant and the ISV. In contrast, a slow or complicated sign-up can scare off potential users. In fact, roughly 40% of prospects abandon a digital onboarding that takes longer than 10 minutes.​

By removing friction, you keep merchants engaged and eager to complete the process. Fast onboarding means more merchants get activated (and generating sales) instead of dropping out. It creates a great first impression of your software’s integrated payments and unlocks business potential without delay. Essentially, you’re ensuring that both you and your client hit the ground running with payments flowing from day one.

Customized Onboarding Solutions Tailored to ISVs

Each software platform is different, so a one-size-fits-all approach won’t cut it. The key is to embed the onboarding workflow into your software in a way that feels natural and branded. In practice, that means your sign-up forms should match your platform’s UI and only ask for information relevant to your merchants. When done right, merchants perceive onboarding as a seamless part of your application rather than an external process.

For example, using a white-label onboarding form with your branding and only the necessary fields for that merchant can greatly reduce confusion and boost completion rates. Tailored solutions make the process intuitive for your users. Additionally, when collecting sensitive information through this process (e.g. Tax ID, personal details, etc), this increases the confidence of the Merchant to supply these online vs more traditional methods that may slow down the process.

Pre-Onboarding Strategies to Enhance Merchant Adoption

Pre-Onboarding for ISVs

It’s mission critical for ISVs to be able to ensure that merchants can go through a smooth onboarding process. To support that goal, MSG tailors a custom plan around an ISV’s goals in conjunction with their clients. If you follow the same templated, cookie cutter approach every time, this can leave both ISVs and merchants frustrated in the long term because they haven’t felt heard or truly had their needs met. 

Part of this process for ISVs in particular can involve pre-onboarding training that ensures they are fully enabled to work effectively with their merchants through the onboarding process. Additionally, running co-branded marketing campaigns with ISVs is a great way to help them to not only have material they can easily share with merchants, but it also helps to boost confidence of their prospects as they prepare for onboarding.

At times, ISVs may also be outside of their core competencies when integrating payment solutions – there’s a lot of other elements of building software platforms that ISVs have to tackle, with payment being just one piece of the puzzle. To better understand how integrated payments can fit seamlessly into software, check out The Ultimate Guide to Integrated Payment Systems for key insights on implementation and best practices. Pre-onboarding activities can fill in the gaps and help ISVs to feel confident about providing an excellent payment experience for their customers.

Pre-Onboarding for Merchants

Successful onboarding often begins before the official merchant application starts. One effective approach is to do a quick pre-screening of merchants early on. During the sales or sign-up phase, gather basic info to ensure the business meets your key criteria (for example, that it’s a registered business and not in a prohibited industry)​.

This preliminary vetting filters out ineligible applicants before they get too far, saving everyone time.

Another strategy is to prepare merchants with a checklist of requirements. Tell them upfront what information to have ready (for example Federal Tax ID, business demographic data, and bank account details) so they won’t hit a wall mid-application. These pre-onboarding steps go a long way toward smoothing the path. By the time merchants reach the formal application, they’re primed to complete it quickly and accurately. This boosts adoption and ensures more merchants make it across the finish line.

By implementing these simplifications, you remove friction from the onboarding process. Merchants can complete all the steps in a single, streamlined flow – often in just a few minutes – and be ready to start processing payments without delay.

Simplifying the Onboarding Workflow

Once a merchant is ready to sign up, simplifying the workflow is crucial. The goal is to make the process as quick and painless as possible. Here are some ways to streamline merchant onboarding:

  • Go fully digital: Provide an online application form or a link inside your software to replace paperwork. Merchants enter their information once, and it flows directly into the processor’s system with no manual re-entry. This also allows the use of digital verification tools to instantly confirm their identity. This speeds up approvals and flags any issues early in the process.
  • Instant bank verification: Let merchants quickly connect their bank account for payouts. MSG uses Plaid to verify the account instantly, avoiding tedious paperwork and back-and-forth.
  • E-sign agreements: Have merchants sign contracts electronically so they don’t need to print or scan paperwork.

Proprietary Auto-Approval Underwriting Process

A major advantage of modern onboarding systems is the ability to automatically approve many applications through advanced underwriting algorithms. Traditionally, once a merchant submitted their paperwork, it might take days or weeks for an underwriter to review and approve the merchant account. Now, auto-approval underwriting can shrink that time to be much shorter – typically less than one business day. As soon as the merchant submits their application, the system runs instant fraud and compliance checks and calculates a risk score. If everything looks good, the merchant can be auto-approved within this rapid timeline so they can quickly start processing payments.

The benefits are huge: merchants don’t have to wait to start processing payments, and ISVs see their clients activated typically within a day. In short, auto-approval underwriting turbocharges the onboarding timeline while still keeping risk in check.

Balancing Automation with Personalized Support

While automation can handle the routine parts of onboarding, it’s important to keep a human touch in the loop. Not every merchant fits a standard mold, and questions or unusual situations will arise. By balancing automation with personalized support, you ensure no merchant gets left behind. For instance, if a merchant isn’t tech-savvy or hits a snag with the online form, a friendly onboarding specialist available via phone or chat can quickly resolve the issue. Likewise, if an application triggers a review (maybe something didn’t verify or the business is higher risk), an implementation specialist can step in to work with the merchant on any additional needs.

It’s also crucial after the initial setup. Onboarding doesn’t end at approval – providers should perform ongoing monitoring of merchant activity to catch any suspicious patterns. By marrying efficient automation with attentive support, you create an onboarding experience that is both scalable and customer-friendly.

Conclusion and Getting Started

Merchant onboarding doesn’t have to be a headache. By using a streamlined, integrated approach, ISVs can make the process easy and efficient for their client merchants. The payoff is clear: faster onboarding means merchants start doing business (and generating revenue) sooner, with all the necessary security and compliance checkboxes already ticked. By customizing the experience, automating where it makes sense, and supporting merchants with a human touch when needed, you turn onboarding into a competitive advantage rather than a hurdle.

If you’re ready to simplify and accelerate your merchant onboarding process, it helps to partner with experts who specialize in this area. MSG Payment Systems has the solutions and experience to help you implement an onboarding workflow that drives adoption and keeps risk under control. We offer integration options that fit your software, a speedy auto-approval process, and dedicated support for you and your merchants at every step. Don’t let clunky onboarding slow your growth. 

Contact MSG Payment Systems to learn how we can help streamline onboarding for your ISV and set your merchants up for success from day one.

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