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Acquirer

The acquirer is the bank that holds the merchant's account and takes on the risk that the merchant will not deliver. It is the merchant's side of the card network.

What it actually does​

  • Underwrites the merchant. Before a merchant can take cards, someone has to decide how likely they are to take money and vanish. That is the acquirer's exposure, not the network's.
  • Holds the merchant account. Settlement funds land here before they reach the merchant's operating account.
  • Submits into the network. Authorization requests and clearing files enter the card network through the acquirer's bank identification number, or BIN — the leading digits of a card number that identify which institution issued it, and, on the acquiring side, the membership a transaction is submitted under.
  • Absorbs chargeback losses when the merchant cannot cover them. This is why acquirers care about reserves and delivery timelines.

Acquirer vs. PSP vs. gateway​

These get used interchangeably and they are not the same thing. The acquirer is the only one of them that is a member of the card network; everything else in the stack operates under somebody else's licence.

Processors, gateways, and PSPs sets out the whole layer, and which of them can fix which kind of problem.

Why it matters operationally​

When settlement is late, the cause is almost always at the acquirer or PSP layer — a funding hold, a reserve, or a batch that did not close — not at the network.

Terms introduced​

  • Merchant account — the account an acquirer holds for a merchant, distinct from a normal business bank account.
  • Reserve — funds an acquirer withholds against future chargeback risk.
  • BIN — bank identification number: the leading digits of a card number identifying the issuing institution, and the membership an acquirer submits under.
  • BIN sponsorship — the arrangement letting a non-bank operate under a licensed bank's network membership.