GS Logo
The Green Sheet, Inc

Please Log in

A Thing
View Archives

View flipbook of this issue

Care to Share?

Table of Contents

Lead Story

Tapping into the U.S. economic pulse

Ann Train


Industry Update

Expect more growth in mobile payments, banking

Fed study finds growth in noncash transactions

Yahoo breaches analyzed

NFC Forum adds specs, Chase goes QR


Sizing and Profiling In-App Payments


2017 – A look back, a look forward

Brandes Elitch
CrossCheck Inc.

Fed updates payments data

Patti Murphy
ProScribes Inc.

The link between company values and ISV relationships

Kelly Cullum
Tantrum Street


Street SmartsSM:
Accounts receivable factoring

John Tucker
1st Capital Loans LLC

Don't make fraud this winter's fashion trend

Don Bush
Kount Inc.

Why do you work?

Jeff Fortney
Clearent LLC

ISO versus MLS status in 2017: The stakes are high

Adam T. Hark
Preston Todd Advisors

Company Profile

Pearl Capital LLC

New Products

Mobile app for convenient, secure cashless tipping

SmartBlue Technologies Inc.

All-in-one POS, business management solution

NCR Silver
NCR Corp.


Making the most of networking opportunities


Letter From the Editors

Readers Speak

Boost Your Biz

Resource Guide


A Bigger Thing

The Green Sheet Online Edition

January 09, 2017  •  Issue 17:01:01

previous next

Readers Speak

What's a payfac?

I overhead a conversation about payfacs the other day. What are they? I'm new to merchant processing, and there's nothing about payfacs in my training materials.

Lydia Nybourg, Customer service rep


Payfac is short for payment facilitator, and we've published articles on payfacs in the past year that will fill you in fully on what they do. In "Payfac: Fad or new norm?" The Green Sheet, Sept. 12, 2016, issue 16:09:01, Adam Atlas defined payfac as follows:

"A payfac, also known as a payment facilitator or payment services provider (PSP), is an aggregated merchant account serving multiple merchants," he wrote. "Usually, a payfac assumes liability for chargebacks and other losses related to its sub-merchants. The acquirer or processor for a payfac looks exclusively to the payfac for all legal liabilities related to the sub-merchants under it.

"The payfac has its own merchant agreement with each sub-merchant and makes underwriting decisions, such as what merchants to board, settlement amounts, reserve accounts, etc. Not all payfacs are the same. Some sub-merchant agreements are tri-party agreements, with the acquirer or processor being parties together with the payfac and the sub-merchant."

Atlas went on to say that a payfac is basically a legal aggregator. "For a long time, aggregation was taboo in merchant services," he noted. "Aggregation means using a single merchant account to process for multiple merchants. High-risk processors have been doing this for decades, but normal ISOs and processors have avoided it because it results in the acquirer processing transactions for merchants with which it has no direct connection."

You'll find the rest of Atlas' article at Another article containing useful information on payfacs is "The changing face of merchant acquiring," by Patti Murphy, The Green Sheet, April 25, 2016, issue 16:04:02, delves into a paper issued by Visa on the payment facilitator model and identifies key responsibilities of payfacs.

Calling for news, questions, suggestions

Thank you to all who have been sending breaking news week in, week out to We look forward to continuing to serve as your educational and professional resource in the coming year. To help us do that, please send your questions and suggestions to

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.

previous next

Spotlight Innovators:

USAePay | Impact Paysystems | Electronic Merchant Systems | Inovio | Board Studios, Inc.