Payment Service Provider (PSP) and Third-Party Acquirer are two distinct entities that play different roles in the payment industry. Understanding their responsibilities can help clarify their differences:
Payment Service Provider (PSP): A PSP is a company that offers a wide range of payment services to assist merchants and businesses in accepting and processing customer payments. PSPs provide various services such as payment processing, payment gateways, risk management, and reporting. They act as intermediaries between merchants and payment networks, such as credit card companies and banks. PSPs facilitate the smooth flow of funds from customers to merchants, ensuring that transactions are securely processed.
Third-Party Acquirer: A Third-Party Acquirer is a specialized entity that focuses on payment processing and plays a crucial role on behalf of the merchant or business. It receives payments from customers, authorizes transactions, transfers funds from customer accounts to merchant accounts, and ensures compliance with regulations and security standards. Third-Party Acquirers work closely with payment networks and act as intermediaries between merchants and financial institutions. They assume responsibility for securely processing payments on behalf of the merchant or business.
In summary
A PSP offers a range of payment services, including payment processing, while a Third-Party Acquirer specializes in payment processing and primarily focuses on handling payments on behalf of merchants or businesses. PSPs act as facilitators, whereas Third-Party Acquirers are specialized service providers dedicated to payment processing.