By Ryan Brough, CEO, Gratify
TL;DR: Merchants are churning at an alarming rate, and onboarding experiences are the key battleground between acquisition and retention. To win, processors need to impress merchants from the very first interaction, and automation is key.
Here's a number that should keep every payment executive up at night: 5 million. That's how many U.S. businesses change their payment provider each year. One in five merchants churn, every year, and most processors act surprised when it happens.
But if you zoom in, it's no surprise. The cracks start in the first 24 hours.
Merchants are dropping out during onboarding, not because they're a bad fit, but because the experience screams "you're not a priority." In a market where every processor promises fast approvals and great service, the only thing that matters is what happens when a merchant signs up.
This is the moment you win or lose, and most processors lose.
Two Battles. One Front Door.
Risk and sales teams are fighting two battles: acquisition, finding qualified merchants quickly, and retention, keeping them long enough to turn a profit.
Most processors fail at both. Why? They treat onboarding like paperwork instead of product.
We've all seen the legacy workflow: static forms, redundant document requests, risk models triggering unnecessary reviews, and sales teams operating in the dark. That's not a workflow, it's a message: "We're not ready for you." No wonder merchants drop off or go live with one foot out the door.
Onboarding Is the Moment to Impress — Not Just Process
To retain merchants, impress them when it counts. This means delivering a clean, fast, transparent onboarding experience that sets the tone for the entire relationship.
This isn't about digitizing PDFs. It's about real automation - onboarding flows that pre-fill applications with data enrichment, run risk rules in real time, and return pre-approval results in under two minutes. Underwriters get context, sales get answers, and merchants get moving.
The difference is night and day. You're not just collecting information, you're showing the merchant you're ready to do business.
Profitable Merchants Don't Wait
Your best merchants, with strong volume, clean financials, and low exposure, won't wait three days for a decision. They'll walk. They have options.
They're not switching processors due to price. They're switching because the experience is broken. If you think a slick website or lower basis points will keep them, you're wrong. The merchant experience is real-time now. If your onboarding isn't, you've already lost.
Repricing Isn't Just a Tool, It's a Strategy
Let's talk about the merchants who survive. Not all are worth keeping.
Some are profitable, some aren't. If you don't know which, you're flying blind. Onboarding can't stop at activation. The data collected at the front door should drive downstream repricing decisions. If a merchant is high risk, low margin, and bleeding support time, you need a strategy, not a spreadsheet.
Gratify's platform ties onboarding signals to ongoing performance, allowing you to segment your portfolio, adjust pricing, and retain high-value merchants with better terms before someone else does. Retention isn't about fighting fires, it's about designing systems that make unprofitable merchants either step up or step off.
You Don't Need More Merchants. You Need Better Ones.
There's a hard truth in this business: adding more merchants won't fix a broken funnel. If 20 percent of your portfolio churns every year, you're not building, you're treading water.
To win, flip the playbook. Build onboarding that retains, build risk models that decide, not delay, and build repricing strategies that optimize, not apologize. This isn't theory, it's what the best processors are doing and how we designed Gratify from day one.
The real question isn't how many merchants you can sign, but how many you can keep and profit from without slowing down.
