What is a Payment Aggregator?

Q: How does this relate to a Merchant of Record model?

The Merchant of Record solution takes things to a different level, offering a higher level of service than the payment aggregator. The MOR model becomes the seller of the product, implying they do more than just payment processing. The MOR also handles: end-to-end global taxation chargebacks regulatory compliance Payment support.

作者： Ioana Grigorescu, 内容经理

审阅者： George Ploaie, 首席运营官 (COO)

What is a payment aggregator?

A payment aggregator allows businesses to accept card and digital payments without opening their own merchant account. The payment aggregator has one master account that is used by each business to process transactions.

Partnering with a payment aggregator simplifies onboarding, especially for start-ups, SMBs, or newly launched businesses.

The payment aggregator manages connections to card networks, security systems, and banks so businesses can receive payments.

How does a payment aggregator process a payment?

A payment aggregator goes through the following steps when processing payments:

A customer enters their payment details at checkout.
The payment data is securely encrypted and tokenized.
The aggregator runs fraud and risk verifcations.
The transaction is sent through the card network to the customer’s issuing bank.
The issuing bank approves or declines the payment.
If approved, the payment is captured and later settled.
The aggregator receives the funds and pays out to the merchant on its payout schedule.

请记住

It is important to notice that throughout the entire process, the SaaS business does not handle raw data at any point, reducing the compliance and security- related operations.

What are the main pros and cons of using a payment aggregator?

Payment aggregators offer both advantages and disadvantages.

优点	缺点
Rapid onboarding: there is no need for an additional merchant account	Higher per-transaction fees
Reduced setup complexity: compliance and infrastructure are handled centrally.	Slower or fixed payout schedules
Multiple payment methods: cards, wallets, and local options through one integration	Possible spending limits or sudden holds if risk rules are triggered
可扩展性： can handle growth in transaction volume without re-architecting.	Limited ability to customize pricing and routing
Simplified operations: consolidated reporting and reconciliation	Aggregators handle millions of users, which means personal support can be limited.

How is a payment aggregator different from a payment facilitator (PayFac)?

Both the payment aggregator andthe PayFac represent payment solutions that SaaS businesses can use. However, they are different in terms of features and approach.

功能	Payment Aggregator	支付服务提供商 (PayFac)
Merchant Identity	Processes all payments under a single merchant ID.	Requires the use of a separate sub-merchant account for each company
Provider Role	The setup is simplified, as it needs to fit general requirements	Takes care of compliance issues and manages bank connections for each account
灵活性	有限的	我ncreased flexibility in terms of pricing, risk and branding
基础设施	Requires minimal overhead.	Requires more infrastructure and oversight from the provider.
Merchant Fit	Easiest to start with; ideal for smaller businesses.	Better for larger or specialized platforms needing granular control.

Which type is better for SaaS businesses?

Payment aggregators are a good fit for:

Start-ups
Low sales volume businesses

The reason for this is that payment aggregators facilitate faster launches.

PayFacs are an option for:

Larger companies
Rapidly expanding companies

This is because in these situations ,businesses require control over aspects like pricing and have greater customization needs.

How does this relate to a Merchant of Record model?

诸如 Merchant of Record 解决方案 takes things to a different level, offering a higher level of service than the payment aggregator. The MOR model becomes the seller of the product, implying they do more than just payment processing.

The MOR also handles:

end-to-end global taxation
退款
法规遵从
payment support.

What should businesses look for when choosing a provider?

Here are the points to consider when selecting the payment aggregator to partner with:

Strong security and PCI compliance
Transparent fees and payout timing
Reliable fraud and risk management
Global payment method 覆盖范围
Clear policies for holds and reserves

Ability to grow with the business (upgrade path to more control if needed)

结论

Payment aggregators are a simple solution for accepting payments, and they work for ealy starts-ups and small companies. However, if SaaS companies are considering global expansion, considering the Merchant of Record model is an option.