How Payment Processor Can Expand Revenue Streams with Crypto

In today’s fast-evolving digital economy, payment processors are seeking innovative ways to grow their revenue streams. The explosive rise of cryptocurrencies has opened up significant opportunities — not only to accept payments in crypto but also to accept credit cards, offering value-added services that boost margins and competitiveness.

In this article, we’ll explore how payment processors can integrate crypto into their payment processing strategies, reduce transaction fees, tap into digital payments markets, and position themselves for long-term success.

Key Point Summary

• Introduction to Crypto Payments
• The Traditional Payment Processing Model: Challenges and Limits
• Why Crypto is a Game-Changer for Payment Processors
• Key Areas Where Crypto Unlocks Revenue Growth
• Types of Crypto Payments
• Security Measures for Crypto Payments
• Overcoming Obstacles to Crypto Integration
• Best Practices for Payment Processors Expanding into Crypto
• Regulatory Compliance for Crypto Payments
• Why Crypto Integration Future-Proofs Payment Processors

Introduction to Crypto Payments

Cryptocurrency payments are a type of digital payment that leverages cryptographic techniques to secure and verify transactions. As businesses increasingly look to accept payments online, crypto payments are becoming a popular payment method. To accept crypto payments, a business needs to set up a merchant account with a payment processor that supports cryptocurrency transactions. These payment processors typically charge lower transaction fees compared to traditional payment methods, making them an attractive option for businesses. Crypto payments offer a secure and fast way to process payments, with transaction times typically taking only a few minutes. By integrating crypto payments, businesses can enhance their payment processing capabilities and offer customers more flexible payment options.

Benefits of Crypto Payments

One of the main benefits of crypto payments is the low transaction fees, which can range from 0.5% to 1% per transaction. This is significantly lower than the fees associated with traditional payment methods. Additionally, crypto payments offer fast transaction times, with most transactions being processed in real-time. This speed can improve cash flow and reduce the waiting period for funds to be available. Another benefit is the increased security, as all transactions are recorded on a public ledger called a blockchain, making them tamper-proof and transparent. This transparency also helps in reducing the risk of chargeback fees, as all transactions are final and cannot be reversed. By adopting crypto payments, businesses can enjoy these benefits while providing a modern and efficient payment experience for their customers.

The Traditional Payment Processing Model: Challenges and Limits

Payment processors traditionally operate by facilitating electronic payments between a buyer’s issuing bank and a seller’s acquiring bank. They generate revenue by charging transaction fees, setup fees, and sometimes monthly fees for services like maintaining a payment gateway or providing a point of sale (POS) system.

However, the traditional model faces challenges:

• High interchange fees charged by card networks (Visa, Mastercard).

• Hidden fees imposed by acquiring banks and payment service providers.

• Growing competition, driving payment processing fees downward.

• Increased risk of fraudulent transactions and chargeback fees.

• Demand for faster, cheaper, global payment options.

These issues are pushing processors to rethink their offerings — and that’s where cryptocurrency payments come in. Acquiring banks and merchant's banks play crucial roles in the payment process, ensuring the secure transfer of funds from the customer to the merchant.

Why Crypto is a Game-Changer for Payment Processors

Integrating crypto payments can transform a payment processor’s business operations by:

• Lowering transaction costs: Blockchain transactions typically have lower fees than traditional credit card systems.

• Speeding up settlements: Crypto eliminates reliance on multiple financial institutions, enabling near-instantaneous funds transfer.

• Enabling global payments: Cryptocurrency payments allow businesses to accept payments online from around the world without expensive international transaction fees.

• Offering new services: Crypto payment solutions (custody, on/off-ramps, stablecoin settlements) offer upsell opportunities.

• Enabling businesses to accept a variety of payment methods securely and efficiently, supporting transaction processing and helping manage operations effectively.

Crypto is not just an additional payment method — it’s an entry point into a more efficient, flexible, and profitable payment infrastructure.

Key Areas Where Crypto Unlocks Revenue Growth

1. Accepting Crypto Payments

Allowing merchants to accept crypto payments expands their customer base, especially among crypto enthusiasts who prefer to pay with crypto.

Processors can charge service fees for:

• Crypto conversion into fiat currencies like USD or EUR.

• Custody services — holding crypto securely until conversion.

• Settlement services to the merchant's bank account or merchant accounts.

Platforms like Google Pay and digital wallets are already moving toward supporting crypto purchases and digital assets.

2. Offering Crypto-to-Fiat Settlement

Many businesses want the flexibility to accept crypto but don’t want cryptocurrency price exposure. Payment processors can solve this by instantly converting crypto into preferred currency at the time of transaction. They facilitate the transfer of funds from the customer's account to the business's account during electronic transactions, ensuring sufficient funds in the customer's account for successful transaction authorisation and overall payment settlement.

This service can include:

• Real-time exchange rates and currency conversion.

• Settlement in local currency within a few business days.

• Support for multi-currency bank accounts.

Own merchant account options can be offered to manage digital asset transactions separately from traditional card sales.

3. Expanding into Stablecoin Payment Solutions

Stablecoins like USDT, USDC, and DAI provide a bridge between crypto and traditional finance. They offer:

• Stable value relative to fiat currencies like USD.

• Reduced price volatility compared to Bitcoin or Ethereum.

• Compatibility with smart contracts and automatic payment flows.

Payment processors can create services tailored to:

• Recurring payments (subscriptions in stablecoins).

• Subscription services to help merchants manage recurring payments securely, mitigating fraud risks and reducing liability exposure by offloading management to SaaS payment processors.

• Cross-border payroll or vendor payments.

• Treasury management for small businesses holding stable assets.

This taps into the booming need for crypto payment services without risking volatile crypto prices.

4. Crypto-Friendly Merchant Accounts

Traditional merchant accounts are not always set up for crypto-related businesses. Payment processors can create a niche offering by:

• Supporting crypto exchanges, NFT marketplaces, and DeFi platforms.

• Providing payment pages optimized for crypto wallets and crypto assets.

• Reducing setup fees for small crypto projects.

• Allowing seamless accounting software integration for crypto transactions.

In a world where business accepts card payments and crypto, offering specialized merchant accounts creates strong differentiation.

5. Advanced Risk Management and Compliance

With new opportunities come new risks. Payment processors must:

• Implement AML/KYC tools for crypto payments.

• Work with regulated financial institutions for custody solutions.

• Ensure compliance with emerging crypto regulations in every country they serve.

• Protect cardholder data using methods like tokenization and point-to-point encryption to secure cardholder information, ensuring compliance with PCI standards and minimizing the merchant's exposure to financial losses.

Using strong security, blockchain monitoring, and customer data protection helps maintain a secure environment for crypto operations.

Types of Crypto Payments

There are several types of crypto payments, including Bitcoin, Ethereum, and Litecoin, each with its own unique features and benefits. For instance, Bitcoin is known for its widespread acceptance and security, while Ethereum offers faster transaction times and supports smart contracts. Litecoin, on the other hand, is favored for its lower fees and quicker block generation time. Some payment processors also offer support for multiple cryptocurrencies, allowing businesses to accept a range of different payments. Crypto payments can be accepted through various payment methods, including online payment gateways, point of sale (POS) systems, and digital wallets. Additionally, some businesses offer crypto payments as a subscription service, enabling customers to make recurring payments in cryptocurrency. This flexibility allows businesses to cater to a broader audience and provide multiple payment options.

Security Measures for Crypto Payments

To ensure the security of crypto payments, businesses should use a reputable payment processor that supports robust security measures. This includes features such as two-factor authentication, encryption, and secure socket layer (SSL) protection. These measures help protect sensitive payment information and prevent unauthorized access. Businesses should also ensure that their payment gateway is compliant with industry standards, such as the Payment Card Industry Data Security Standard (PCI DSS). Keeping software and systems up to date is crucial, as it helps protect against vulnerabilities and potential threats. Additionally, businesses should train their employees on how to handle crypto payments securely and be aware of the fee structure and any potential hidden fees associated with crypto payments. By implementing these security measures, businesses can provide a secure environment for processing crypto payments.

Overcoming Obstacles to Crypto Integration

Despite the benefits, some challenges must be addressed:

• Education: Merchants and small business owners need education on how to accept crypto payments safely.

• Bank Relationships: Some banks track crypto activity closely. Choosing crypto-friendly partners is crucial.

• User Experience: Checkout flows must be optimized to avoid cart abandonment.

• Business Hours: Extended business hours for customer support and payment processing are essential, especially for businesses operating during weekends or across multiple time zones. This ensures prompt resolution of payment transaction issues.

Processors must invest in user-friendly interfaces, fast transaction processing, and clear communication of payment options to customers.

Best Practices for Payment Processors Expanding into Crypto

Here are some key steps to succeed:

Understanding specific payment processing needs is crucial when selecting a payment processor. Factors such as fees, accepted payment methods, security, international support, and scalability should align with the current and future needs of a business to optimize efficiency and customer satisfaction.

By following these practices, payment providers can not only expand their reach but also improve their profitability per transaction.

Regulatory Compliance for Crypto Payments

The regulatory environment for crypto payments is constantly evolving, and businesses must ensure that they are compliant with all relevant laws and regulations. This includes registering with financial institutions, obtaining necessary licenses, and complying with anti-money laundering (AML) and know-your-customer (KYC) regulations. Compliance with tax laws and accurate reporting of all crypto transactions are also essential. Businesses should be aware of any international transaction fees or restrictions that may apply to crypto payments and ensure they are compliant with these regulations. Staying up to date with changes or updates to these regulations is crucial for maintaining compliance. By understanding and adhering to the regulatory requirements, businesses can navigate the complexities of crypto payments and operate within the legal framework.

By following these guidelines, payment processors can effectively integrate crypto payments into their offerings, providing businesses with a modern, secure, and efficient way to accept payments.

Why Crypto Integration Future-Proofs Payment Processors

The payments landscape is evolving fast:

• Blockchain technology is becoming mainstream.

• Digital asset adoption is growing among consumers and businesses.

• Fiat currencies are being complemented by stablecoins.

• Cross-border transactions are increasingly demanding faster, cheaper solutions.

Understanding how payment processors work is crucial in this evolving landscape. Payment processors work by facilitating electronic transactions between customers and businesses. This involves the initiation of payments, encryption of transaction data, and the roles of acquiring and issuing banks in the authorization and settlement process.

Payment processors that integrate crypto now can:

• Differentiate themselves from traditional banks and legacy payment providers.

• Expand into decentralized finance ecosystems.

• Support direct crypto trading integration (future opportunities).

• Offer competitive exchange rates and zero currency exchange fees compared to others.

In short, crypto creates a strategic advantage — not just an incremental feature.

Conclusion

Expanding revenue streams with crypto isn’t just about adding a new payment method; it’s about future-proofing your payment processing solutions.

By offering crypto payment services, stablecoin settlements, and merchant accounts tailored to the crypto economy, payment processors can:

• Increase margins

• Enhance customer experience

• Reduce costs

• Open up entirely new markets

A crucial part of this process is the role of the payment provider. The payment provider influences the timing of funds transfer to the merchant's bank, determining whether the funds are available immediately or within a few business days. This makes the payment provider significant in the overall payment processing flow.

At FinchTrade, we support payment processors with robust crypto liquidity, secure custody, seamless settlement, and all the tools needed to scale globally in the new digital economy. For requesting more information about how we can help reach out to us. We're here to help and answer any questions you may have.

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