Payment Service Provider

A payment service provider (PSP) is a company that enables and facilitates the acceptance of digital payments. This includes traditional online payment options such as debit and credit cards, but also extends to alternative methods such as electronic transfers, eWallets, and more.

Full-service PSPs are an all-in-one solution that manages the collecting, authenticating, and processing of payments. More sophisticated providers also offer risk mitigation and management services, fund settling, and some type of fraud protection.

The overall purpose of a PSP is to lower the cost and confusion of digital payments while improving the user experience and simplifying multi-channel checkout. It also allows merchants to accept cards without directly interacting with the acquirer.

PSPs offer greater security for both businesses and customers. Providers validate and verify transactions prior to authorizing payments, and they will take care of all compliance requirements.