# Payfac, gateway, acquirer, or merchant of record

Title: Payfac, gateway, acquirer, or merchant of record

Description: What each provider type actually sells, and which Stripe problem it solves. Read November 9, 2026. Source pages linked. Compared with Stripe.

The names in a payments contract describe who is allowed to touch the card networks, and who the customer thinks they paid. Buying the wrong type is how a business ends up with a gateway and still no approval to charge.

## What is a payment service provider?

A **payment service provider** such as Stripe, Square, or PayPal processes under its own master account. You sign up, you are a sub-merchant in practice even if nobody uses the word, and you go live quickly. The provider can remove you later. That speed is the product and the risk.

## What is a payment facilitator?

A **payment facilitator** is registered with the card networks to board sub-merchants and is responsible for underwriting them. Frame is in this category, and so are the platform products: Finix, Rainforest, Payabli, Tilled. The difference is who the sub-merchant is. Frame's profile is a business that wants to charge cards. Finix's profile is a software company that wants its customers to charge cards.

## What is an acquirer?

An **acquirer** is the bank-side institution that settles with the networks. Adyen and Worldpay are acquirers. Large merchants contract with them directly. Small ones meet them only as a name on someone else's statement.

## What is a gateway?

A **gateway** moves the transaction to a processor. Authorize.net and NMI are gateways. A gateway without a merchant account does not deposit money.

## What is a merchant of record?

A **merchant of record** sells the product to the end customer. Paddle and Lemon Squeezy are merchants of record. Tax and chargebacks are theirs because the sale is theirs. You pay more because you handed them the liability.

## What is billing software?

**Billing software** writes the invoice and the subscription state. Chargebee does not move money. If you remember one test, use this one: who is on the hook when the cardholder disputes the charge, and who is allowed to say yes before the first dollar moves?

## Questions

### What is a payment service provider?

A payment service provider such as Stripe, Square, or PayPal processes under its own master account. You sign up, you are a sub-merchant in practice even if nobody uses the word, and you go live quickly. The provider can remove you later. That speed is the product and the risk.

### What is a payment facilitator?

A payment facilitator is registered with the card networks to board sub-merchants and is responsible for underwriting them. Frame is in this category, and so are the platform products: Finix, Rainforest, Payabli, Tilled. The difference is who the sub-merchant is. Frame's profile is a business that wants to charge cards. Finix's profile is a software company that wants its customers to charge cards.

### What is an acquirer?

An acquirer is the bank-side institution that settles with the networks. Adyen and Worldpay are acquirers. Large merchants contract with them directly. Small ones meet them only as a name on someone else's statement.

### What is a gateway?

A gateway moves the transaction to a processor. Authorize.net and NMI are gateways. A gateway without a merchant account does not deposit money.

### What is a merchant of record?

A merchant of record sells the product to the end customer. Paddle and Lemon Squeezy are merchants of record. Tax and chargebacks are theirs because the sale is theirs. You pay more because you handed them the liability.

### What is billing software?

Billing software writes the invoice and the subscription state. Chargebee does not move money. If you remember one test, use this one: who is on the hook when the cardholder disputes the charge, and who is allowed to say yes before the first dollar moves?

## Sources

Last verified November 9, 2026.

- Stripe pricing: https://stripe.com/pricing?ref=https%3A%2F%2Fwww.stripealternatives.com

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- [Visa's VAMP rules explained for merchants](/blog/visa-vamp-explained.md)
- [The real cost of a chargeback, by processor](/blog/cost-of-a-chargeback.md)
- [Payments explainers](/blog.md)
- [Stripe alternatives directory](/index.md)
- [Stripe pricing and US card fees](/alternatives/stripe.md)