The modern software company no longer stops at solving workflow problems—it now controls how money moves.
From once selling licenses and dashboards, Independent Software Vendors (ISVs) have emerged as the infrastructure behind how merchants collect payments, manage subscriptions, track customers, and drive revenue. It’s not a feature add-on; it’s a power shift. The platforms merchants use daily are quietly becoming the central nervous systems of their businesses.
The Embedded Revolution
Rather than referring merchants to third-party processors, ISVs are embedding payments into the software itself—offering unified login, simplified onboarding, and a seamless experience merchants never want to leave. But it doesn’t stop at payment acceptance. ISVs are embedding financial intelligence: recurring billing tools, real-time fraud detection, auto-updating expired cards, and even loyalty integrations. These are no longer perks; they are survival features in the modern merchant stack.
The software now owns the transaction moment. That ownership means power.
Monetizing the Moment
By embedding financial infrastructure, ISVs stop selling software and start monetizing flow. Think subscription billing. Think card vaults. Think auto-renewals that don’t break when a card expires. Every tap, every swipe, every recurring charge becomes a revenue-generating touchpoint.
Legacy banks and processors? They’re now just plumbing behind the wall. The ISV is the storefront.
With the right rails, software companies enter revenue-sharing models where every transaction yields a cut—not just a one-time licensing fee. The merchant’s success becomes the ISV’s annuity.
The Loyalty Lock-In
When payments and value-added services (VAS) are embedded inside the same interface merchants already use for inventory, scheduling, customer management, and reports—something profound happens: churn collapses. It’s no longer just software. It’s irreplaceable.
Instead of toggling between six vendors and support lines, merchants get it all in one platform—from order to payment to analytics. That’s why vertical SaaS is exploding: because industry-specific ISVs can tailor every micro-feature to the workflows of salons, clinics, contractors, auto dealers, and beyond.
Choosing Infrastructure, Not Just Partners
The ISVs that win will be those that choose infrastructure partners who understand this tectonic shift. Not just processors, but growth enablers—those who offer API-first architecture, hands-on sales enablement, scalable onboarding, and fraud intelligence tailored to verticals.
Because this isn’t just about tech. It’s about merchant trust. If you power their money, you power their survival.
Conclusion: The Software Is the Bank Now
In 2025 and beyond, ISVs are not looking to plug in to payments—they’re looking to own them. The merchant no longer wants tools. They want ecosystems. And whoever controls the ecosystem, controls the margin, the loyalty, and ultimately, the market.
The power has shifted. And smart ISVs are already acting like the new financial institutions—whether they wear a banker’s suit or not.
