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Audience: Loan Servicer or Collector, Management Team, Developers, Accounting, Loan Servicing/Collections Managers, Administrator, Compliance, Data
Lenders have a few options to choose from when taking payments from borrowers. These include things like in-person payments (cash, check, money order, and card), NACHA payments, and integrated payment processing. Each one has its benefits and drawbacks. Some payment options require a lot of manual work for the lender. LoanPro's integrated payment processors significantly reduce the amount of manual work required to take payments.
Integrated payment processing enables taking payments directly in LoanPro. They also work perfectly with LoanPro's AutoPay feature, which lets you set up payments for the future and then processes them automatically. This article will give general information about LoanPro’s integrated payment options and the features integrated processing provides.
For more information on payment processing, check out our Payment Processing article.
Use Case: Card
Use Case: Payment Integrations/Card
A lending company has been using a third-party payment processor for all of their bank card transactions. They recently noticed that using a third-party service is not only costly, but also requires a lot of manual work from their employees. Each time a borrower makes a payment, their employees have to take the information about the payments processed and input it into their loan management system. They have also seen some compliance issues arise in the past when their payment processor accidentally double processed a borrower's payment that ultimately resulted in an overdraft fee.
Instead of searching for another third-party payment processor, they are looking for a different solution to help them avoid these issues.
LoanPro offers a variety of integrated payment processors that will initiate bank card transactions, post payments, and update payment statuses in LMS. Each integrated payment processor for bank cards has its own unique set of benefits, but our integration with them saves you the time and money spent trying to find a processor on your own. Because the processors are integrated directly with LoanPro, bank cards can be deactivated after a specified number of failed payment attempts. This lessens the manual labor required for this process and keeps your company compliant.
Using LoanPro's integrated payment processors helps move money efficiently, ensures secure transactions, and provides a more hands-off system for processing payments.
Integrated payment processing is exactly what it sounds like. LoanPro has chosen processors that fit lenders' needs, and we have done the necessary development to directly integrate with them.
Integrated Payment Features
Not all features are available from every integrated payment processor. Some of the common features for integrated processors include the following:
- The ability to take payments directly within LoanPro (both Secure Payments and LMS).
- Automatic payment status updates in LoanPro (both Secure Payments and LMS).
- Automatic reversal of failed or charged back payments.
- Built-in testing environment
Along with these features, integrated payment processors will work with LoanPro's AutoPay feature.
Integrations by Payment Method
We have several processors to handle each payment method. Bank Cards include debit card, prepaid cards, and credit cards. E-checks or Automated Clearing House (ACH) transactions involve moving money directly from a borrower's bank account. An Electronic Fund Transfer (EFT) is just like an ACH transaction, only operating through the Canadian banking system instead.
Bank Card Processing
|Canada EFT Processing
Authorize.net, LoanPaymentPro, TabaPay, and Repay are companies that Secure Payments currently is integrated with for credit and debit payments. This integration works for U.S. companies ONLY. There are several pieces to a credit/debit card transaction, but the two that will be important to any company wanting to take credit/debit payments through LoanPro are the payment gateway and the merchant service provider.
In LoanPro’s case, the payment gateway will be Authorize.net, LoanPaymentPro, TabaPay, or Repay. This online service replaces the physical swiping of a credit or debit card. Payment information will be relayed to the payment gateway first and then routed through your merchant services provider to the credit card company.
The merchant services provider is the company that actually provides access to the credit card companies (e.g. visa). This company will usually charge a per-transaction, percentage-based fee. It will be important that you get a good rate from your merchant services provider if you are doing a lot of transactions because it could cost you a lot of money.
If you choose to go with Authorize.net, the easiest and best way to get a merchant services provider and to sign up with Authorize.net is through Select Bankcard. LoanPro spent significant time negotiating with merchant services providers to get the best rates, and these rates are available to all of our customers. Select Bankcard has a wealth of experience with working with LoanPro's customers and will efficiently set you up to take credit/debit payments online. Even if you have an existing merchant, we highly recommend you to look into using Select Bankcard—several customers save more than the cost of LoanPro software just by using them.
ACH (US eChecks)
LoanPro is integrated with several eCheck merchant service providers. Merchants in this space can have very specific and strict requirements, but the number of options available through Secure Payments will help you find a good option for your company. If the available options don't quite fit your needs, Secure Payments is constantly adding integrations with eCheck processors. Secure Payments currently supports ACHQ, Actum, and Repay.
EFT (Canadian eChecks)
Secure Payments is also integrated with VersaPay and EFT Canada for EFT transactions. EFT transactions work similarly to eCheck transactions. You can only use this integration if your company is based in Canada.
Using NACHA or CPA-005 files is a way to submit payments to payment processors that don’t have an API. These files are formatted in a way that is understood by banking systems. NACHA is the US standard, and CPA-005 is the Canadian standard. You can either send or pull money using these files.Tab Body
Regardless of which company you use, the company will provide you information that must be entered into the LoanPro system to process payments through LoanPro. To enter this information, navigate to Settings > Company > Merchant > Secure Payments inside your company’s account and create a payment processor of the appropriate type.
This Feature is Not
Let's clear up some possible misconceptions about our integrated processors.
- Integrated payment processing does not give you the option to use any payment processing company you want. LoanPro is integrated with specific payment processing companies. We advise against using payment processors with which we are not integrated, because payments will involve manual processes and you won't be able to use all of LoanPro's payment features.
- We can't guarantee that you will be approved to process payments through an integrated processor. LoanPro has integrated with payment processors that will often approve our lenders, but each processor has their own underwriting processes. There is no guarantee that our integrated processors will approve you. If they don't approve you, there is nothing we can do.
Once you have an account with an integrated payment processor you will have to set up a Payment Processor to use them for payment processing.