Merchant Acquirer vs Payment Processor (2024)

FAQs

Merchant Acquirer vs Payment Processor? ›

Quick summary: payment processor vs merchant acquirer

A payment processor handles the transfer of funds between the customer's and the business's financial institutions, ensuring secure and efficient transaction processing. Merchant account: A merchant account is a special type of bank account that allows businesses to accept and process electronic payments.

The payment processor handles the authorization and secure transfer of transaction data, while the acquirer manages the merchant account, authorizes the transaction with the issuing bank, and facilitates the settlement of funds.

Payment Service Provider. The main difference between a Payment Service Provider and a Merchant of Record is that a PSP is a payment-only solution. On the other hand, the Merchant of Record is responsible for the entire order process, payment processing, financial risks, regulations, and liability.

Elavon is the 4th largest U.S. credit card processor and is a top 6 acquirer in the European marketplace.

Quick summary: payment processor vs merchant acquirer

A payment processor transmits data between other parties involved in a transaction, whereas a merchant acquirer is the licensed financial service provider that manages merchant accounts, through which businesses accept card payments.

Since Stripe is functionally a gateway, processor, and merchant account all in one, it removes all of the middlemen and simplifies the fees. Currently, Stripe costs 2.9 percent plus 30 cents per transaction. There are no setup or monthly fees, and Stripe offers bulk pricing.

Some platforms, like PayPal, can act as both processor and acquirer, completing your business transactions and securely storing your money in one place.

Looking at the top-ranked companies, JPMorgan Chase & Co. ranks first for estimated US total processing volume at $2.4 trillion and total transactions at 46.2 billion. Stripe ranks first for estimated US total number of merchants at nearly 3.8 million.

Examples of merchant acquirers

Commonly known merchant acquirers you may have heard of, include GoCardless, Adyen, First Data, or WorldPay. Some of these merchant acquirers may also play the role of the payment service provider.

Is Chase a merchant processor? ›

Most payment processing systems have to connect with a separate acquiring bank during each transaction. But because Chase is both a payments processor and an acquiring bank, there will be fewer handoffs in the process and fewer stakeholders that need to get paid.

A payment processor is a company or service that facilitates electronic transactions—such as payments made with credit cards, debit cards, or digital wallets—between businesses and their customers.

Pricing starts low per transaction, but it will add up quickly if you're looking for a more robust service. Is Stripe a merchant of record? No. Stripe as a PSP does not assume the same responsibilities an MoR does, such as managing risk, assisting with chargebacks, and handling taxes.

We offer a variety of flexible deployment models to meet everyone's individual business needs. PRIME seamlessly combines card issuing and merchant acquiring with online authorisation and switching.

We offer a full suite of payment services across the EMEA regions, from merchants services including acquiring and online payments to POS terminal leasing and sales through our Clover brand and through partners. Our clients range from local businesses and SMEs to global enterprise businesses.

Also known as the acquiring bank or merchant bank, the acquirer is a financial institution that handles a merchant's account so that they can accept credit or debit card payments. Essentially, it is a financial services provider that acts on behalf of merchants.

What is payment processing? Payment processing is the series of actions that occur when digital payment transactions are initiated by a business. This includes everything from processing a card and opening secure gateways to communicating with issuing banks and consumer accounts.

Payment processors handle the entire payment transaction to ensure merchants get paid. From authorization to settlement, payment service providers facilitate the transfer of funds from customers' accounts to merchants' accounts.

Billing and payment are two concepts that work hand-in-hand but are still quite different from each other. Billing is more focused on issuing invoices and tracking payments, while payment processing is mainly about taking payments and transferring them into your account.