What is an acquirer and why do you need them? We explain the basics of payment processing and merchant agreements for businesses.
What does an acquirer do in the payment process? #
Simply said, an acquirer is the link between the bank and your customer’s credit card that controls and validates the credit card as well as possession of an amount of your revenue to secure chargeback before paying the amount into your bank account.
When you want to accept payments in your e-commerce or subscription service, you need an acquiring agreement to be able to process payments. The acquirer will handle the process from your chosen payment gateway to the customer’s bank and then back to you.
To be able to make that transaction, there are some requirements in regards to how you get an agreement with an acquirer.
The payment process takes place in a few steps:
- The customer initiates a card transaction, either in-store or online.
- Your payment gateway sends the transaction details to the acquiring bank.
- The acquiring bank sends a signal through the card network associated with the payment card, e.g., Mastercard or Visa.
- The customers bank confirms the availability of funds in the customer’s account.
- If the funds are insufficient, the transaction will be decline; and if there are enough funds, the transaction will be approved.
- Once the transaction is complete, the acquiring bank deducts the funds from the customer’s account.
- When the merchant completes the daily settlement, the acquiring bank ensures that the funds are transferred to the your account.
The advantages of a merchant agreement #
From a customer’s point of view, a payment transaction is an uncomplicated process that often only involves a quick tap of their card. But behind the simple transaction is a complex system of financial institutions that work together to make the transaction possible, with the acquiring bank as the key component in the payment process machinery.
The acquiring bank provides the merchants with all the necessary tools for payment processing, allowing the merchants to accept digital payments, expand their customer base, improve customer experience, and increase sales. Acquiring gives merchants several benefits, such as:
- More payment options: credit and debit cards, electronic payments and more
- Streamlined payment process, letting the merchants focus on their business
- Secure risk management systems to reduce the risk of fraud
- Enhanced customer experience, increasing customer satisfaction and loyalty
As Frisbii collaborates independently with several acquiring banks, our acquiring service can match you with the best possible acquiring deal for your business needs, giving you access to the payment methods your customers want.
Acquiring services can support a wide range of payment methods, and provide additional services for the merchant, such as:
- Reconciliation reporting
- Credit and debit cards
- E-wallets
- Direct debit
- Bank transfers
- Fraud prevention
- Chargeback management
Choosing a merchant acquirer #
When you’re using Frisbii as your payment gateway, you have a free choice of acquirer.
We are not dependent on a specific acquirer, so you have the freedom to choose to keep the one you have or to get assigned with a new one. This is not common in the payment industry, but we can only see benefits for our customers and for us in being acquirer independent.
A selection of the acquiring partners for the Frisbii payment gateway:
Rapyd (previously Valitor): An Icelandic financial services company providing payment processing and merchant services in Iceland, the UK, and other European countries.
Swedbank Pay: A major Swedish bank offering financial services, including merchant acquiring, mainly in Sweden and the Baltic countries.
Elavon: A global payment processor providing acquiring services to businesses across the US, Europe, and other regions.
Nets: A Northern European payment services company offering acquiring services and payment solutions to merchants in the Nordic region and other European countries.
Clearhaus: A Danish payment institution providing acquiring services to European merchants, with a focus on e-commerce and digital businesses.
Worldline (previously Bambora): A global payment services company offering acquiring services and payment solutions to merchants in multiple countries, including Europe and other regions.
In addition to these acquirers, we can also offer our customers acquiring services with CMCIC, SIX, Worldpay, AIB MS, Barclays, First Data EU, Colombia CredibanCo, Shift4 and Thailand Kasikorn Bank (Kbank).
You can easily add your existing agreement into our solution or fill in details to get a new agreement. If you need help with your acquiring agreement, old or new, contact us and we will help you!
The difference between merchant acquiring agreements and acquiring services #
Merchant acquiring agreement
An acquiring agreement is a legal contract between a merchant and an acquiring bank or payment service provider that outlines the terms and conditions of the payment processing services. It includes details such as the types of payment methods supported, processing fees, settlement schedules, and dispute resolution procedures. The agreement also sets out the responsibilities of both parties, including compliance with applicable laws and regulations.
Acquiring service
An acquiring service is a financial service that, among other services, includes the merchant acquiring agreement and enables merchants to accept and process electronic payments from their customers. By using an acquiring service, you can simplify the payment process, improve your cash flow, and increase sales by offering customers more convenient and secure payment options, combined in one easy-to-use product package with your Frisbii payment gateway and subscription management.
Tips for preparing for an acquiring agreement #
When you want to get an agreement with an acquirer, first you need to prepare some information to verify your ownership and identity along with your expectations for the performance of your webshop.
Some of the elements you need to prepare are:
- Your company information
- The company registration file
- Share of ownership
- Your business model
- Bank account
- Your registered websites
Along with the above required documents, it is also important that you have your detailed terms and conditions, your terms for subscription and images for the cards you are receiving. When you have that in place, you are ready to get the deal with the acquirer closed within just a few days.
Read more about acquirer agreements and how Frisbii supports you with the process on our official info page.
Do you have any questions about acquirers? Book a meeting with one of our payment experts to find out how to opmize your payment methods setup and fees.
