Shift4, specializing in commerce solutions, payment processing, and merchant account solutions, will direct all Eigen customers to their platform for continued seats. While the acquisition is confirmed, details of the deal have not yet been released. However, a banner on the Eigen website announced Shift4 and Eigen Merger and said that Eigen would be rebranded in the coming days.
Key Takeaways
- Expansion of Payment Solutions: Shift4 Payments has acquired Eigen Payments, aiming to broaden its presence in North America by integrating Eigen’s retail, restaurant, and hospitality payment solutions into Shift4’s platform.
- Additional Fees for Existing Customers: Existing Eigen customers will face new fees, including a $350 Annual Platform Connectivity Fee per location starting January 2025 and a 0.05% fee on credit card transaction volumes beginning December 2024 until they transition to Shift4’s platform.
- Benefits of the Shift4 Platform: Businesses transitioning to Shift4’s platform will access advanced features like free EMV device upgrades, enhanced security tools, 24/7 support, and improved reporting capabilities, streamlining payment processing and reducing costs.
- Concerns About Fee Increases and Transparency: Past acquisitions by Shift4 have led to significant fee increases, raising concerns that Eigen merchants may face similar hikes. Additionally, the transition’s timing and lack of transparency may lead to operational disruptions and strained customer relationships.
Shift4 Acquires Eigen Payments to Expand Payment Solutions in North America
Shift4 has acquired Eigen Payments, a Canadian company specializing in retail, restaurant, and hospitality payment solutions. The announcement was made through an update on Eigen’s website, stating that the two companies will collaborate to serve merchants.
Shift4 is recognized as a leader in payment technology, processing hundreds of billions of dollars in transactions annually for businesses worldwide. The company provides end-to-end payment processing solutions, including secure hardware, software, and a robust processing network. Its PCI-validated point-to-point encryption, advanced tokenization, and comprehensive fraud prevention tools make it a reliable business choice.
With the merger, Shift4 aims to expand its customer base, integrate Eigen’s existing solutions into its platform, and offer businesses access to a wider range of features and tools.
The merger is also expected to enhance Shift4’s end-to-end payment solutions by integrating Eigen’s technology and customer base, potentially leading to increased market size.
Shift4 and Eigen Merger: More Details
Details about when the deal was finalized, or the financial terms involved have not been disclosed. We know that Eigen’s transaction gateway will cease operations by the end of 2025. Between now and then, existing Eigen customers must transition to the Shift4 platform. To ensure continued support for legacy Eigen solutions until the transition is complete, a new Annual Platform Connectivity Fee of $350 per location will be implemented starting January 2025. This fee will be billed annually, covering ongoing maintenance, compliance, and networking costs.
In addition to the fixed annual fee, Eigen customers will incur a 0.05% fee on their credit card transaction volumes beginning December 2024. These fees are aimed at supporting the legacy platform during the transition.
However, businesses that upgrade to Shift4’s platform will no longer be subject to the Annual Platform Connectivity Fee or the additional transaction volume fee.
The merger marks another step in a series of international acquisitions by Shift4 this year, reflecting the company’s efforts to expand its global presence and customer base. Earlier in the year, Shift4 acquired a majority stake in Vectron Systems, a German point-of-sale supplier, in June. This was followed by the acquisition of Givex, a Canadian gift card company, in August. These strategic moves highlight Shift4’s commitment to strengthening its international operations and diversifying its offerings.
In 2023, Shift4 acquired SpotOn’s sports and entertainment vertical, formerly Appetize, for $100 million, enhancing its presence in the sports venue market.
Benefits Users Will Get When Transitioning to Shift4
Shift4 offers numerous benefits to customers transitioning to its platform, presenting a significant upgrade over Eigen’s legacy solutions. Businesses can use free EMV device upgrades, including handheld devices, and the exclusion of gateway charges, reducing operational costs. Competitive processing rates further contribute to improved profitability.
Eigen merchants migrating to Shift4 will gain access to a more advanced payment platform. Shift4’s solutions include PCI-validated point-to-point encryption, advanced tokenization, and robust reporting tools. These upgrades are critical for businesses looking to enhance security and operational efficiency.
Customers also gain access to a 24/7 direct support line for uninterrupted assistance, along with robust risk support and transaction monitoring to minimize fraud and chargebacks.
Additionally, offline processing capabilities ensure that payment services continue seamlessly during network disruptions. Advanced reporting and management tools further support enterprise operations, enabling businesses to tackle modern payment challenges efficiently and confidently.
Things to Be Concerned About the Shift4 and Eigen Merger
One major criticism of Shift4 is its history of implementing fee increases after acquiring companies. Merchants from previous acquisitions, such as Givex and Revel, have reported significant rate hikes over time, raising concerns that Eigen merchants could face similar cost increases after transitioning.
Shift4 has also faced criticism for using merchant lock-in agreements, which tie businesses to long-term contracts and make it difficult to switch providers without penalties. These agreements limit flexibility and can create challenges for merchants who are unhappy with the service.
The transition from Eigen to Shift4 introduces new fees for existing Eigen merchants, including a $350 Annual Platform Connectivity Fee per location and a 0.05% transaction volume fee. These additional costs may be burdensome for merchants who are not ready to migrate immediately. Moving to Shift4’s platform may also require significant changes to merchants’ infrastructure, including hardware upgrades and staff training. For small businesses, these adjustments could be costly and time-consuming.
Concerns have also been raised about how Shift4 communicates changes to merchants. Critics point to a lack of transparency, which could damage relationships with existing customers and erode trust over time. The timing of the transition is also a big concern. The shift could disrupt operations during the busy holiday season, a crucial time for merchants who rely on seasonal sales, potentially leading to unexpected costs or operational challenges.
About Shift4
Shift4 Payments, Inc. is a global software and payment processing solutions provider offering a wide range of services to businesses in the United States and internationally. The company’s platform supports omni-channel card acceptance, handling various payment types such as debit, credit, Europay, contactless cards, Visa, MasterCard, mobile wallets, QR Pay, and alternative payment methods. In addition to payment processing, Shift4 offers several technology solutions to help businesses scale and improve efficiency.
Their SkyTab POS system enhances operations, while VenueNext provides countertop POS, mobile ordering, digital wallet capabilities, and service kiosks, focusing on food, beverage, merchandise, and loyalty services. The company also offers Lighthouse, a cloud-based suite of business intelligence tools for customer engagement, reputation management, social media management, reporting, and scheduling. SkyTab Mobile enables order-at-the-table, pay-at-the-table, customer feedback, delivery services, and email marketing for mobile solutions. Additionally, Shift4 provides The Giving Block, a cryptocurrency donation marketplace, and Shift4Shop, an e-commerce platform that helps businesses create web stores and manage product catalogs, inventory, order fulfillment, and SEO.
Shift4 Payments also offers integrations into third-party applications, loyalty and inventory management solutions, and other services like tokenization, gateway security, chargeback management, fraud prevention, and risk management. The company supports merchants with onboarding, underwriting, training, activation, and compliance management. Founded in 1999 and headquartered in Center Valley, Pennsylvania, Shift4 distributes its products through independent software vendors, a direct sales network, enterprises, and value-added resellers.
About Eigen Payments
Eigen Payments, based in Vancouver, British Columbia, is a leading payment gateway provider focused on helping North American merchants manage their payment processing needs. The company offers many solutions, including point-of-sale (POS) integrations, mobile payments, wireless payment options, and web commerce tools. With a strong emphasis on security, Eigen Payments specializes in PCI-compliant point-to-point encryption (P2PE) technology, ensuring safe and secure credit card transactions. Their services cater to various industries, including retail, restaurants, and large properties. In addition to payment processing, they provide consultation, setup, software, and technical support.
As a PCI-certified payment processor, Eigen Payments relies on the PA-DSS-certified MiraServ™ platform to deliver reliable solutions. Their services include POS system integrations, mobile ordering and payments, wireless payment solutions, batch payments, EMV chips, PIN migration, and gift card and loyalty programs. With a focus on enhanced security, their technology features a PCI Validated P2PE solution, ensuring secure credit card transactions for businesses and their customers.
Conclusion
The acquisition of Eigen Payments by Shift4 represents a significant step in Shift4’s expansion into the North American market, particularly within the retail, restaurant, and hospitality sectors. While this merger offers promising benefits, such as access to advanced payment solutions and competitive processing rates, it also introduces concerns regarding new fees and potential rate hikes for existing Eigen customers. The transition process, which includes additional charges and infrastructure changes, may prove challenging for businesses, particularly smaller ones.
Furthermore, Shift4’s track record with previous acquisitions and its communication strategy raises questions about the transparency of the process and its impact on customer relationships. As the merger unfolds, businesses must carefully evaluate the costs and benefits of transitioning to Shift4’s platform.
