The PaaS Value Chain: Enabling Disruptive Payments

Mercator started extensive coverage of the prepaid industry in 2004 and has defined its value chain. That value chain and the technologies utilized have evolved, and Payments-as-a-Service (PaaS) providers are the result.

Prepaid processors expanded their platforms in three directions. First, new payment types from the card networks were added, including virtual cards, tokens, and push payments. Second, the processing platforms were exposed so third-party developers could easily access the platforms’ capabilities using Application Programming Interfaces (APIs). Third, new networks were added to the platforms, including ACH and same day ACH, to expand capabilities beyond the card networks’ Mastercard Send and Visa Direct real-time push payment solutions.

These enhancements have been transformative. As use-case models became packaged and more readily available, they gave birth to the reality of Payments-as-a-Service (PaaS). Processors, freed from the physical card, exposed to all developers on the internet, and enabled to send value at any time, to any account, located anywhere in the world, created a range of new opportunities, new business models, and an entirely new value proposition.