Quick answer
An acquirer (or merchant acquirer) is the bank or licensed payment company that signs up a merchant to accept card payments, sends each payment request into the card network and later pays the merchant, minus fees that include interchange passed to the card issuer[1].
Key points
- The acquirer works for the merchant; the issuer works for the cardholder.
- It forwards authorisation requests to the card network and receives the money at settlement.
- The merchant pays the acquirer a fee, part of which is interchange paid on to the issuer.
On this page
#What does an acquirer do day to day?
An acquirer checks and signs up merchants, provides or connects the systems that read cards, forwards each payment request into the card network, and pays the merchant once the payments settle. In the four-party model it sits between the merchant and the network, opposite the cardholder's issuer. In the EU, the fee the merchant pays its acquirer includes an interchange fee that is capped for consumer cards[1].
#How is an acquirer different from an issuer?
The issuer gives the card to the cardholder, approves or declines each payment and collects the money from the cardholder's account or credit line. The acquirer serves the merchant. One bank can be both, but for any single payment it plays only one role on each side. Regulators use the same split: the US Federal Reserve's Regulation II defines an interchange transaction fee as a fee paid by a merchant or acquirer to compensate an issuer for its involvement in an electronic debit transaction[2].
Worked example
Example
A café uses a card terminal from its payment provider. When you tap your card, that provider (the acquirer) sends the request through the card network to your bank (the issuer). After the day's payments settle, the provider pays the café for all its card sales in one amount, minus its fees.
#Is a payment service provider the same as an acquirer?
Not always. Many online checkout companies are payment service providers that bundle a payment gateway, fraud tools and an acquiring licence; others partner with a separate acquiring bank behind the scenes. For a beginner the practical question is simply who pays the merchant and who handles chargebacks. See also interchange and chargeback.
Frequently asked questions
Do consumers ever deal with an acquirer?
Rarely. Cardholders deal with their issuer; the acquirer's customer is the merchant.
Who decides whether my card payment is approved?
Your issuer decides. The acquirer only forwards the request and receives the answer.
Sources
- Antitrust: Regulation on Interchange Fees (fact sheet MEMO/16/2162) — European Commission, 2016 Primary
- Regulation II (Debit Card Interchange Fees and Routing) — Frequently Asked Questions — Board of Governors of the Federal Reserve System, 2024 Primary
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