Blog  /  PayOp  /  What is a Payment Facilitator?
How to start an online business in 2021?

What is a Payment Facilitator?

Your company is just beginning its journey in the market and you are thinking of how to accept electronic payments from your customers? You can go the traditional way and open your own trading account in payment systems or large banks. It sounds simple enough, but in practice, you may face a number of difficulties. In particular, filing an application to open a trading account can take a lot of time and effort. Let’s be frank, most modern banks are more focused on cooperation with large enterprises, which make a huge number of payments every day.
As for start-up companies, they should think about cooperation with a payment facilitator.

The definition of a Payment Facilitator and what is the essence of its work?

A payment facilitator is a company that creates software and enables other enterprises to accept payments quickly and conveniently using their own platform for this purpose. Thus, companies do not have to deal with the purchase of software (which turns out to be very expensive), applying for an account, organizing the process of accepting payments and so on.
For a better understanding, let’s say that from the moment of applying to open an account to the actual acceptance of payments by the traditional method may take weeks or even a month. Thanks to the payment facilitator, you will have instant access to the available opportunities and will be able to accept payments from your clients the next day without sacrificing potential profits.
All the necessary infrastructure will be ready for you, and you just need to start using it. In addition, payment intermediaries are always ready to solve any issues that your company would otherwise have to solve.

Why did payment facilitators appear?

The main reason payment facilitators appeared is the complication of the company’s interaction with large payment service providers. Why should companies go through a long process of filing applications and solving many organizational issues to accept payments when everything can be done quickly and easily? Payment facilitators answer this question, significantly simplifying payment acceptance and making it as comfortable as possible.
To start working with a payment facilitator, merchants must provide 7-8 key characteristics of the data. The underwriting algorithm will check all these data. If it does not contradict the current requirements, the application will be approved by the system online.

Basic functions of payment facilitators

During their work payment facilitators perform a huge number of important functions, namely:

  • Underwriting. All merchants who connect to a single MID are necessarily checked for lack of fraud and terrorism. For this purpose, the international practice “Know Your Client” is used. In this way, the payment facilitator identifies companies with a high degree of risk. Due to the use of the most modern technologies, the underwriting process does not take much time, and suspicious activity can be detected almost immediately.
  • Monitoring. Even when the seller’s request to connect to the trading account and use the platform is successfully fulfilled, the payment facilitator will still continue to monitor transactions and identify those that may be classified as suspicious. If such trades are found, they will be referred to the Risk Management Department for further investigation.
  • Financing. The revenue generated by the sub-seller is successfully paid to him. At the same time, the payment facilitator is able to offer its customers maximum control over the funds by transferring some of its important experience to them.

In addition, the payment facilitator’s duties include the function of refund management, which is performed jointly with the acquiring bank.
It is important to understand that not all payment intermediaries are willing to offer you special and lowest commissions. The main reason for this is that all transactions are conducted through one MID.
However, it will not be a big problem for you if you entrust the organization of the PayOp payment acceptance process. Our commissions are among the lowest on the market. In addition, you will get immediate access to more than 350 different payment methods. Your customers from more than 170 countries will be able to successfully pay for your goods, noting the high level of service and be sure to come back to you again.
We guarantee a high level of transaction security, fast verification and many ways to withdraw money.
Contact us right now and we will offer you special, even more profitable cooperation.

Credit card vs debit card. What is the difference?
Stay up-to-date
Get our news earlier than others