EMPOWERING MSMES: TAKING THE MERCHANT ONBOARDING PROCESS DIGITAL

Onboarding a merchant in less time with proper due diligence has always been the prime objective for every acquirer in the market. The conventional process of onboarding merchants is complicated. It is time-intensive and could require a lot of back and forth with pages and pages of paperwork.

- Ankit Ratan

From a merchant perspective, the process is often seen as cumbersome, time-consuming, and a less than desirable experience. From the perspective of the acquirer, it is costly, labour intensive and not efficient. Digitizing the process is an ideal solution. It provides speed, flexibility, and scalability.

The traditional process of merchant onboarding

The traditional process of merchant onboarding can take 68 days. The process is time-consuming and tedious. Here is a basic rundown of the current process of onboarding:

1. An RM (Relationship Manager) visits the merchant

2. Physical application forms are manually filled in by the merchant

3. Original documents are submitted to the bank

4. The documents are sent for screening and verification by the bank. In case something is missing or details incorrect, the merchant is again contacted and asked to provide further information.

5. Final approval is granted by the Merchant Acquiring Business (MAB)

6. Merchant Identification Number (MID) is either approved or rejected (MID is a unique number assigned to a merchant account to identify it throughout the course of processing activities)

Now, this process can have two models depending on the level of input from the RM - Assisted model and Self-model.

Fallacies with the traditonal process

The traditional merchant onboarding process is fragmented. It is not seamless and convenient. Each step can take time and face roadblocks. When that happens, there is more delay until correct details are retrieved, documents backed, or clarifications provided. Drawbacks of the manual process are: