The End of an Era: Why the Old Merchant of Record Model No Longer Works
For years, Digital River and similar Merchant of Record (MoR) providers operated under a one-size-fits-all approach, bundling payments, tax compliance, fraud prevention, subscriptions, and even customer service into a single solution. But as the needs of mid-market and enterprise brands have evolved, this outdated model has proven to be too expensive, too rigid, and too shallow in features.
Digital River was a pioneer that created the original Merchant of Record model, but its recent collapse underscores a broader shift in the market: Merchants today need more control, customization, and cost-efficiency than legacy MoR providers can offer.
Why the Traditional Merchant of Record Model Failed
The traditional MoR model attempted to do everythingâsubscription management, fraud, tax, and paymentsâunder one umbrella. While this may work for start-ups and other small companies, it creates three major problems as businesses scale:
Broad, But Shallow Functionality
Traditional MoR providers spread their services across multiple functions but lacked depth in key areas. Their subscription management tools werenât as sophisticated as best-in-class platforms, their fraud prevention couldnât compete with dedicated risk solutions, and their global payment capabilities were limited.
High Costs with Low Adaptability
Bundling all these services into one platform came with substantial price tags, literally and figuratively. Through traditional MoRs, High-growth and established brands ended up paying very high fees while being locked into a rigid system that couldnât adapt to their evolving requirements.
Slow to Evolve, Hard to Integrate
Traditional MoR solutions were built on monolithic platforms that required a heavy lift to integrate with modern tech stacks. Custom API connections, lengthy onboarding times, and inflexible workflows meant that global businesses couldnât quickly adapt to new payment methods, tax regulations, or global expansion opportunities.
As such, this cumbersome approach isnât optimized to scale. As high-growth and established retail ecommerce and SaaS businesses demanded more control, more customization, and more cost-effective solutions, Digital River and similar providers fell behind.
The Future of MoR: Embedded, Flexible, and Cost-Effective
Instead of forcing international businesses like yours into an all-in-one platform that limits functionality and flexibility, our model represents the next generation of Merchant of Recordâone that seamlessly embeds into your existing tech stack while providing all the MoR benefits and cost savings you need to scale globally. Meaning you can:Â
Activate our MoR capabilities into your existing payment and subscription platforms without having to rip and replace your current infrastructure and start from square one.
Avoid Complex Integrations, as our streamlined embedded integrations can get you up and running fast. This means zero technical lift on your end and no costly downtimes for your international consumers, saving you money and time. Â
Stay agile with our lightweight, cost effective, and adaptable model that evolves and scales with your international business.
We empower high-growth and established brands like yours with the scalability and adaptability you need to growâwithout the roadblocks of the past.
Making the Switch: Whatâs Next for Digital River Merchants?
If youâre a business impacted by Digital Riverâs collapse, you donât have to settle for another outdated MoR model. With us as your global partner, you can transition to a modern, embedded solution that provides all the benefits of an MoR without the high costs, rigid workflows, or lack of customization.
The era of the traditional Merchant of Record is over. The future belongs to agile, cost-efficient solutions that enhance your existing systemsânot replace them.