In the ever-evolving world of vertical SaaS platforms, choosing the right payment strategy can be a make-or-break decision—not just for platform growth, but also for customer experience and monetization. Two terms often used in this conversation are integrated payments and embedded payments. While they may sound similar, the difference is profound—and so are the benefits of getting it right.
In this post, we’ll break down the distinction between integrated and embedded payments, and explain why embedded payments are the gold standard for vertical SaaS platforms looking to scale efficiently and profitably.
What Are Integrated Payments?
Integrated payments refer to the approach where a SaaS platform connects to a third-party payment provider (such as Stripe, PayPal, or Authorize.Net) using APIs or plug-ins. While the integration enables payment functionality, the actual experience—like merchant onboarding, transaction monitoring, or settlement—is still handled largely outside of your platform.
Characteristics:
- Merchants often sign up with the third-party provider directly.
- Users may be redirected outside the platform for onboarding or dashboards.
- The SaaS company has limited control over the user experience and monetization.
What Are Embedded Payments?
Embedded payments go a step further by deeply integrating the entire payment experience within the SaaS platform. From merchant onboarding and KYC, to accepting payments, managing payouts, and delivering insights—everything happens natively in the software interface.
Fully embedded payments within your platform mean that merchants onboard, transact, and access real-time reporting without ever leaving your software. This ensures a seamless, consistent experience that feels like a natural part of your product—not an external add-on.
This model is often powered by becoming a Payment Facilitator (PayFac) or by partnering with a PayFac-as-a-Service provider.
Characteristics:
- Seamless, native onboarding and UI
- Full control over branding and experience
- Monetization opportunities through payment revenue
- The platform owns the merchant relationship
Why Embedded Payments Win on User Experience
For vertical SaaS platforms, user experience is everything. Embedded payments dramatically enhance the merchant journey and unlock new business value in ways integrated payments simply can’t.
1. Frictionless Onboarding
Say goodbye to third-party forms and redirection. Merchants can sign up and start accepting payments right inside your platform—often within minutes.
2. Unified UI and Experience
The payment flow stays consistent with your platform’s design. This creates a branded, trustworthy experience for your users.
3. Faster Time-to-Revenue
While integrated options may involve multi-day approval processes, embedded payments often enable instant and/or bulk onboarding and activation—meaning your users start transacting sooner.
4. Deeper Data Visibility
With embedded payments, your platform owns the entire data flow—transaction history, user behavior, payout activity—which means better analytics and smarter customer engagement.
5. New Revenue Streams
Rather than handing over valuable payment margins to third parties, you capture a share of the transaction revenue. This high-margin income can transform your SaaS business model.
6. Streamlined Compliance (with the Right Partner)
PayFac-as-a-Service solutions help you deliver a native experience without taking on the full regulatory or administrative burden of being a registered PayFac yourself.
What to Look For in an Embedded Payments Provider
If you’re ready to embed payments into your SaaS platform, the provider you choose will have a massive impact on both your product experience and your bottom line.
Here are four key things to look for:
1. Unified Pay-In and Pay-Out Capabilities
A common limitation among many embedded payment providers is the inability to support both pay-ins and pay-outs under one roof. This can create friction when trying to manage sub-merchants, service providers, or vendor payouts. Choose a provider that bridges both sides of the money movement—ensuring faster settlement, seamless fund distribution, and better cash flow control.
2. Flexible Integration Options
Your development team shouldn’t have to force-fit your platform into rigid SDKs or templated flows. Look for providers that offer:
- Modern, modular APIs
- Webhooks and event-driven architecture
- Clear documentation and sandbox environments
This allows you to tailor the payment experience to your platform’s design and business logic.
3. Hands-On, Expert Support
Payments can be complex—but your journey shouldn’t be. The right provider offers proactive, strategic guidance from discovery to go-live, and everything in between. That includes:
- Technical integration support
- Merchant onboarding optimization
- Compliance and risk workflows
- Ongoing product and go-to-market strategy
Beyond launch, you should expect responsive, hands-on support from experts who understand your industry. The right partner will help you and your customers resolve issues quickly, optimize operations, and provide guidance tailored to your vertical—whether you’re serving contractors, gyms, law firms, or property managers.
This kind of support reduces risk, accelerates go-live, and builds long-term confidence in your payment infrastructure.
4. Cost and Pricing Transparency
A strong payments partner doesn’t just present pricing—they help you understand it and turn it into a strategic revenue stream. Look for:
- Transparent rates and no hidden fees
Your partner should clearly explain interchange and processing costs, what’s being charged, and why—so there are no surprises. - Flexible monetization options
Whether you absorb fees, pass them on, or bundle them into your pricing, you should have control over how payments contribute to your bottom line. - Simple, easy-to-read billing
Avoid confusing or opaque statements. Clear, itemized billing builds trust and streamlines reconciliation. - Tailored pricing strategies by vertical
The right provider helps you set pricing that fits your market—allowing you to control margins, define terms, and capture revenue in ways that align with how your customers buy, whether you’re serving contractors, law firms, fitness studios, or beyond.
For vertical SaaS platforms, payments are more than a back-end utility—they’re a strategic lever for growth, retention, and monetization. While integrated payments may offer a quick start, embedded payments create long-term value through a smoother user experience, stronger brand ownership, and deeper monetization opportunities.
Choosing the right partner is just as important as choosing the right model. With the right embedded payments provider, your SaaS platform won’t just process payments—it will own them.
Want to learn more about embedding payments in your vertical SaaS platform? Let’s talk – we’d love to help you unlock the next layer of growth.