Payments
Acquirer (acquiring bank)
Updated
The acquirer, or acquiring bank, is the bank that signs up the merchant, sends its card payments into the card networks and pays the money out to it.
The acquirer is the merchant's side of a card payment. It holds the merchant agreement, assigns the merchant category code, submits each authorisation and settlement to Visa or Mastercard, and receives the funds before paying the merchant.
Card network rules are written mostly for acquirers. Visa requires its acquirers to assign the correct merchant category code, register high-integrity risk merchants before processing for them, and keep merchants within monitoring programme limits. When a merchant breaks a rule, the network fines the acquirer, which passes the cost on.
Most online stores never deal with an acquirer directly. A payment provider such as Stripe, or a payment facilitator, sits in between and works with acquiring banks on the merchant's behalf.
Frequently asked questions
- What is the difference between an issuer and an acquirer?
- The issuer is the cardholder's bank and decides whether to approve. The acquirer is the merchant's bank and submits the payment and receives the money.
- Do online stores deal with an acquirer directly?
- Usually not. A payment provider or payment facilitator sits in between and handles the acquiring relationship on the store's behalf.