Importance of Referral Partnerships in Payments Industry
Referral partnerships have become common today in the payment industry. You may have heard about referral partners earning a commission when someone buys a product or service through them. But what is referral partner, referral partnerships, and what is its importance in the payment industry? Let’s find out.
What is a Referral Partner?
A referral partner is a business associate who recommends a particular company and its services to its customers in exchange for something of value like money. Let us understand what it means with the help of an example. Suppose you have partnered with a company, and you recommended its products on your social handles. If the recommendation results in a sale, your partner company might reimburse you when the deal closes with a percentage of the earnings or a predetermined monetary reward called a referral fee.
Referral partnership offers a win-win-win situation for everyone. It is perfect if you want to create a new revenue stream and earn commissions paid by your referral partner.
Importance of Referral Partnerships in Payments Industry
Referral partnerships have become important in today’s time and age. These partnerships give both the parties involved an opportunity to grow. How important these partnerships are in the payment industry can be assessed by the fact that people prefer to buy something recommended by an authoritative figure they trust rather than buying from any brand.
Read on to know why referral partnerships are important.
It allows referral partners to earn without being tied directly to a business’s core products
A referral program is an excellent opportunity for those who want to create a revenue stream without being tied directly to a business’s core products that they are recommending. The program promotes the idea that partners can still benefit financially when faced with business opportunities that are not tied directly to their business’ core products. By setting up partner relationships, a company can still benefit from nurturing a business contact who otherwise would not bring in income.
In addition to earning money, referral programs help increase a partner’s geographic reach, create demand for an MSP’s unique offering and increase new customer acquisition.
It helps payment solution providers offer a reliable and secure payment gateway to their customers
As a payment solution provider, partnering with a referral partner can offer many lucrative benefits for you, along with improved functionality for your clients. You can provide your customers with a reliable and secure payment processing service with a referral partnership program. In return, you can potentially earn additional credit card processing revenue.
It can help to scale both partners’ business beyond their own four walls
Referral networks that include customers, strategic partners, and other providers of products or services can help scale their partner’s business beyond its own four walls by introducing new ways to refer business out and accept new business. The arrangement of referral partnerships can be mutually beneficial – both partners can refer each other for business opportunities that more closely align with their respective areas of expertise. It will help both partners outgrow their four walls and scale new heights. However, it is important to remember that you must have a strong base of satisfied customers if you are participating in a referral network.
It drastically reduces the cost of entering the payments market
A referral partnership drastically reduces the cost of entering the payments market. It also ensures access to the partner’s resources and expertise while enabling a business to test the market before making a stronger commitment. A referral partnership enables both parties to capitalize on their individual strengths to expand business opportunities.
Keep in mind that a business doesn’t need to specialize in payment technology in order to offer customers innovative solutions. For some companies, the best option is to simply partner with a payment technology partner and refer clients to them.
Bonus: 5 Benefits of Referral Partnerships
- With referral partnerships, one can capitalize on the growing payments market simply by referring to their customers
- One gets marketing support and assistance to capitalize on the opportunity
- Generates upfront and residual commission
- Allows you to leverage your existing customer base to drive additional revenue
- An entirely hands-off approach with no upfront or ongoing investment
Take Away
The referral partnership programs are perfect for businesses looking to increase their revenue by making recommendations to their clients. As a payment provider, you may be looking for additional ways to accelerate your revenue goals and broaden your sales reach. The best way to do that is by entering referral partnership programs.
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