If you’re a SaaS company, ISV, or ISO, you’ve probably looked at your payments gateway bill and thought: “We could totally build our own and save a fortune.”
And we get it. Some of the existing gateways out there are clunky, overpriced, and about as user-friendly as a fax machine. Building your own seems like the elegant fix — full control, custom features, no more paying someone else five cents per transaction. What could possibly go wrong?
Oh... plenty.
We’ve actually built gateways from scratch. More than once. Here’s the cold, PCI-compliant truth: unless you’re paying your current gateway six figures a month, that five cents you’re trying to save will cost you way more in the long run.
Development costs don’t stop at launch.
Building the gateway is just the beginning. You’ll need a team of engineers on payroll forever to handle bugs, updates, and “why did the processor just reject every Visa transaction?” emergencies.
PCI DSS compliance is not a one-and-done.
You’ll be responsible for storing, transmitting, and processing cardholder data in a way that meets the Payment Card Industry’s Data Security Standards. That’s a moving target — and annual audits aren’t cheap.
Card brand updates are relentless.
Visa and Mastercard roll out changes twice a year (April and October), and you’ll need to implement them flawlessly to stay compliant. Miss something? Expect fines… or worse.
Certification will eat your timeline.
Every processor integration requires certification. That’s weeks or months of back-and-forth testing — and it’s on you, not your processor, to get it right.
Your “savings” will evaporate.
Between staffing, compliance, infrastructure, and ongoing certifications, you’ll burn through your projected savings in no time. That five cents? Gone, plus interest.
You’re an expert in your field — not in payments.
We’ve seen phenomenal software companies with brilliant products go down the “we’ll be our own payments company” path, and it almost always ends the same way: it consumes them.
If you’re not already a payments expert — or willing to hire people who’ve been deep in the trenches building gateways before — this path will crush you. Instead of building the new features your customers are begging for, or the enhancements that attract new users, you’ll find yourself knee-deep in backend integrations, processor certifications, and compliance paperwork that your end users will never see or care about.
And here’s the thing: if you’re building salon software, telling a prospective customer “we have our own payments gateway” isn’t going to blow their mind. They care about whether your scheduling app is beautiful and easy to use, whether your tools help them run their business, and whether you save them time. Payments are important, but in most cases, they’re not the selling point.
If you hate your payments gateway and partner so much that you’re ready to build your own, stop. Call us first. We’ll help you find the right partner with the right tech so you can keep focusing on what you’re great at — and let the payments nerds focus on what they are great at.
And for the love of all things merchant account-related, if you ignore all of this advice and still decide to build your own gateway, do not — and I repeat — do not build a payments gateway that just talks to another payments gateway. We’ll cover why in our next post, including the story of a group that spent $3 million and years in development only to end up with a solution that didn’t work, created more problems than it solved, and ultimately got scrapped.
Bottom line:
If you’re processing hundreds of millions of transactions a year, maybe — maybe — it’s worth considering. But for most SaaS companies, ISVs, and ISOs, building your own gateway is a slow, expensive way to reinvent the wheel while setting it on fire.
If you really want to improve your payments experience and margins, there are smarter ways to do it — and that’s exactly what we help our clients figure out.