What’s in a Name: The usage of “Pay”

I admit that when I see a fin tech with a “Pay” in its name, something inside goes “here we go again, what’s new?” 😅 . Generally, the companies seem to fall into a few common buckets, which I then use as a heuristic to roughly understand what they do.

So when someone mentions a company called “XXX-Pay” or “Pay-XXX”, I think — well, they probably are one of the following:

Summary of buckets/categories

Let’s dive into each bucket/category.

1/ Payment method

• Definition: A mode of payment, a form of payment for which a consumer pays a business for goods/services.
• Payment methods can be digital wallets managed by private companies. Some examples with “Pay” in the name are PayPal, LinePay, KakaoPay, Apple Pay, Google Pay, Paytm, Alipay, WechatPay [1]), or inter bank networks led by governments — PayID (AU), Promptpay (Thailand), Paynow (Singapore), or a card network (Union Pay).

Photo by Edi Kurniawan on Unsplash — Gopay (Digital Wallet)

2/ Payment service provider

• Definition: Processing payments from one party to another (usually consumer to business but could be business to business). Payment service providers integrate the payment methods (category 1) to make these available for their end merchants. This could be domestic payments processing, or cross border payments processing (eg enable merchants to sell to overseas markets and/or pay their suppliers in overseas markets).
• Examples that have a “Pay” in the name: Chase Payment Tech, Worldpay, Durianpay, Ipay88, Razerpay, Dragonpay, Paystack

3/ Embedded finance within platforms/marketplaces

• Definition: platforms/marketplaces offering white labelled payments via category (2) payment service providers (or banks, or both), to offer financial services to their merchants. Financial services range from payment acceptance, B2B payouts (eg local or overseas remittance), and lending. “Embedded Finance” is now a buzzword that I don’t love using, but I will write about this further at some point.
• Examples: Shopify Pay, Woo Payments, Lightspeed Payments — and many more.

Photo by Roberto Cortese on Unsplash

I might have left out some examples, but I think most fintechs with a “Pay” in their name has fallen into one of these three categories. Love to hear some more examples/find more categories, so please feel free to comment.

[1] More on mobile/digital wallets here.