What is payment orchestration?  

Payment orchestration is a transformative approach to managing payments, designed to simplify and optimise the process of connecting with multiple payment service providers (PSPs), gateways, and payment methods. At its core, it acts as a centralised, intelligent layer between a business and the payment ecosystem, enabling seamless integrations and operational efficiency.

Unlike traditional setups where businesses must individually connect to and maintain relationships with different payment providers, payment orchestration consolidates these efforts into a single, unified platform. This technology provides tools for smart transaction routing, real-time analytics, and consolidated reporting, which are critical for managing high transaction volumes across diverse geographies.

The need for payment orchestration in multi-provider environments  

As businesses expand globally, they must offer payment options catering to local markets, preferences, and regulations. Relying on a single payment provider may limit reach, lead to higher failure rates, or increase fees. Here’s why companies turn to payment orchestration:   

1. Regional preferences: customers in different regions prefer specific payment methods (e.g., iDEAL in the Netherlands or Alipay in China)

2. Risk mitigation: having multiple PSPs reduces the risk of revenue loss due to downtime or performance issues with one provider

3. Cost optimisation: payment orchestration helps merchants route transactions through the most cost-effective or efficient providers

4. Operational complexity: a centralised platform reduces the burden of managing multiple PSP integrations and separate reporting

Key benefits of payment orchestration  

Payment orchestration is transforming how businesses manage their payment systems, offering a centralised and seamless solution to handle transactions across multiple providers. This approach brings operational simplicity, cost savings, and greater flexibility, making it an essential tool for modern enterprises. Here’s a closer look at its key advantages. 

1. Seamless integration of multiple payment providers  

Payment orchestration platforms simplify the technical challenge of integrating and managing several PSPs. Instead of building custom integrations, businesses can connect their payment providers through a unified API.  

2. Smart transaction routing  

With payment orchestration, transactions can be routed intelligently based on criteria like cost, success rate, or geographic region. For example:  

- High-value transactions can be routed through providers with the best fraud protection.  

- Cross-border transactions can be directed to PSPs with favourable exchange rates.  

3. Improved payment success rates  

Dynamic routing ensures transactions are retried through alternate gateways in case of failures. This significantly increases authorisation rates, leading to higher revenue.  

4. Global scalability  

Payment orchestration enables businesses to scale internationally without worrying about payment infrastructure. Companies can quickly add new PSPs to cater to regional markets.  

5. Centralised data and reporting

Merchants gain a holistic view of their payment data through unified dashboards. This allows for better decision-making and easier reconciliation.  

6. Enhanced security and compliance

Orchestration platforms often include advanced fraud detection and compliance tools, ensuring adherence to global regulations such as PSD2 or PCI DSS.  

How payment orchestration works

At its core, payment orchestration unifies the fragmented landscape of payment gateways, processors, and methods into a streamlined system. This integration enables businesses to automate transaction routing, optimise costs, and provide a consistent user experience. By acting as a centralised platform, payment orchestration simplifies complex payment workflows, offering enhanced transparency, efficiency, and control for merchants.

• Centralised integration: Payment orchestration platforms connect a merchant’s system to multiple PSPs via APIs, eliminating the need for separate integrations.
• Dynamic routing: The system intelligently directs transactions to the most cost-effective or reliable payment provider based on real-time conditions, improving authorisation rates and reducing costs.
• Failover mechanisms: If a primary provider experiences downtime, the orchestration layer automatically reroutes the transaction to an alternative provider, ensuring minimal disruption.
• Customisable workflows: Businesses can tailor payment flows to specific needs, such as prioritising low-cost providers or optimising for speed.
• Consolidated operations: It unifies payment data across providers into a single dashboard, streamlining analytics, reporting, and reconciliation.

Challenges in multi-provider payment management without orchestration

Managing multiple payment providers without orchestration can lead to inefficiencies and operational headaches. Businesses face issues like fragmented data, increased transaction costs, and scalability limitations. Additionally, the lack of a unified system increases the risk of failed transactions and limits the ability to adapt quickly to market demands or customer preferences. These challenges underscore the need for a sophisticated orchestration layer to ensure smooth payment operations.

• Integration complexity: building and maintaining multiple PSP integrations is resource-intensive
• Operational inefficiency: managing separate systems for reconciliation, reporting, and monitoring creates silos
• Downtime risks: relying on a single provider can lead to revenue loss during outages
• High costs: lack of optimisation leads to higher transaction fees and lower success rates  

Use cases of payment orchestration  

• E-commerce: large marketplaces use orchestration to offer region-specific payment methods while ensuring high uptime and smooth transactions 
• Subscription services: companies handling recurring payments improve authorisation rates through dynamic routing and retry mechanisms  
• Travel and hospitality: payment orchestration reduces costs in cross-border transactions and supports multi-currency payments

The future of payment orchestration

The global payment orchestration market is growing rapidly, driven by increased demand for seamless cross-border transactions and higher customer expectations. As businesses embrace omnichannel strategies, payment orchestration will become indispensable. 

According to MarketsandMarkets, the global payment orchestration market is expected to grow at a CAGR of 20% between 2023 and 2028, reflecting its critical role in modern payment ecosystems.  

Final thoughts  

Payment orchestration is more than a buzzword; it’s a transformative technology that addresses the complexities of managing multiple payment providers. By streamlining processes, optimising costs, and enhancing payment success rates, orchestration platforms unlock immense value for businesses aiming to thrive in today’s competitive landscape.  

Ready to simplify your payment operations? Discover how Akurateco’s advanced Payment orchestration solutions can revolutionise your business.