It is when a business is set up as a primary merchant account and provides payment processing to its sub-merchants. You own the payment experience and are responsible for building out your sub-merchant’s experience. Step 3) Integrate with a payment gateway As with any merchant account, a PayFac’s master merchant account requires a payment gateway for transactions to flow through. Discover how REPAY can help streamline your billing process and improve cash flow. It is when a business is set up as a primary merchant account and provides payment processing to its sub-merchants. What is a payment facilitator (payfac)? A payment facilitator (payfac) is a type of merchant services provider that simplifies the payment process for businesses. becoming a payfac. PayFac vs ISO is an illustrative example of natural selection and adaptation in the fintech world. You own the payment experience and are responsible for building out your sub-merchant’s experience. 1. Typically a payfac offers a broader suite of services compared to a payment aggregator. PayFac vs. Discover flexible, scalable solutions that fuel your growth and transform the payments experience to delight your customers. To fulfill its core responsibilities, a payment processor typically uses a payment gateway to 1) encrypt and transmit payment details, and 2) communicate transaction approvals and declines. 1. A payment processor serves as the technical arm of a merchant acquirer. What ISOs Do. What is a payment facilitator (payfac)? A payment facilitator (payfac) is a type of merchant services provider that simplifies the payment process for businesses. Our digital solution allows merchants to process payments securely. Thanks to its flexibility and profitability, PayFac model seems to perfectly adjust to the present-day market requirements. This solution involves you partnering with either (1) an acquiring bank or (2) an acquirer and a payment facilitator vendor. The second type is a more modern, technology-first payfac solution from a commerce provider like Stripe. The customer views the Payfac as their payments provider. 30, including 2-3% for every transaction, and $0 to $25 monthly cost. Cards and wallets. 78% of people 40 and under would stay with their bank if it went all digital, according to our recent Expectations & Experiences consumer research, focused on digital banking and fintech services. One classic example of a payment facilitator is Square. While both models allow businesses to accept payments, a payfac might. Payfac and payfac-as-a-service are related but distinct concepts. Authorize. The main difference between the two entities is that one is a company that facilitates payments, and the other is a piece of software that integrates into a website or payment portal. NMI’s gateway, merchant relationship management and embedded payments solutions provide PayFacs, ISOs and software developers with everything they need to offer elevated merchant services. The choice between a PayFac and a payment processor depends on your business needs, industry, and desired level of support. In a nutshell, the business problem that the PayFac, as an entity, and payments facilitation, as a concept, seeks to solve, and which has existed stretching back decades: Small businesses have. With business activities in 50 markets and 150+ currencies around the world, we are now among the largest fully integrated merchant acquirer and payment processors in the world. 00 Retains: $1. Payment gateway Payfacs provide a payment gateway, a software that acts as an intermediary between a business’s website and the payment processor. Priding themselves on being the easiest payfac on the internet, famously starting. A payment facilitator (payfac) is a type of merchant services provider that simplifies the payment process for businesses. PayFac vs ISO. We would like to show you a description here but the site won’t allow us. Information Flow. Let us take a quick look at them. In other words, processors handle the technical side of the merchant services, including movement of funds. Instead of each individual business needing to set up its own merchant account, a process that can be time-consuming, the payfac effectively “rents out” merchant account functionality under its. using your provider’s built-in tokenization and gateway solution can greatly reduce your Payment Card Industry (PCI) scope. PayFac vs ISO. Stripe benefits vs. What is a payment facilitator (payfac)? A payment facilitator (payfac) is a type of merchant services provider that simplifies the payment process for businesses. Generate your own physical or virtual payment cards to send funds instantly and manage spending. The concept is continuing to evolve According to analysis from GlobalData, the worldwide market for digital payments will reach nearly $2,500 trillion in value in 2023, expanding at a compound annual growth rate (CAGR) of 14. Bank/ credit or debit company. PayFacs are generally. +2. A payment gateway ensures that a customer’s credit card is valid. PayFac-as-a-Service (PFAAS) combines easy-to-integrate payment technology, full-service offerings, and transparent pricing to deliver Independent Software Vendors a simple way to harness the full power of payment facilitation – minus. It can also. An ISV can choose to become a payment facilitator and take charge of the payment experience. Under the payment facilitators, the merchants are provided with PayFac’s MID. Instead of each individual business needing to set up its own merchant account, a process that can be time-consuming, the payfac effectively “rents out” merchant account functionality under its. Find a payment facilitator registered with Mastercard. However, they do not assume financial. Learn the similarities and the key differences in how they operate. PayFac vs merchant of record vs master merchant vs sub-merchant. See our complete list of APIs. North America’s leading healthcare organizations, revenue cycle management and accounts receivables management companies trust RevSpring to maximize their financial results. It also needs a connection to a platform to process its submerchants’ transactions. Payfac-as-a-service vs. The monitoring process ensures that there are no anomalies and in cases of unlawful activities, suspensions are placed. The payment facilitators themselves: which are companies providing the necessary infrastructure and allows their sub-merchants to accept payments via credit card. Uniform Business Rate: A multiplier used in England and Wales to determine how much money owners of commercial and industrial properties must pay each year to their local governments. ISO does not send the payments to the. Posted at 5:43 pm in Operations, Payment Processing. Visa, Mastercard) around 2011 as a way for aggregators to provide more transparency into who their sub-merchants were. Payment gateway Payfacs provide a payment gateway, a software that acts as an intermediary between a business’s website and the payment processor. Both offer ways for businesses to bring payments in-house, but the similarities. Payment facilitators, aka PayFacs, are essentially mini payment processors. Similar to PayPal or Square, merchants don’t get their own unique. Then the PayFac needs to build a number of other tools or go through compliance processes, like becoming PCI Level 2 certified, but as soon as they. Likewise, it takes a lot of work and expenses to become a PayFac. Stripe, which is a tech-enabled evolution on the traditional payfac model, is a complete solution that combines the functionality of a merchant account and a gateway in one. Difference #1: Merchant Accounts. When it comes to choosing between a PayFac and an ISO, the best option depends on your business's specific needs and preferences. This model is ideal for software providers looking to. A Payment Facilitator or PayFac simplifies merchant account enrollment which allows smaller companies to quickly gain the upper hand. If you want to offer payments or payments-related. Registered payment facilitators earn 20-40 basis points more per transaction than they would riding the rails of another wholesale PayFac. When choosing between a Payment Facilitator (Payfac) and a Merchant of Record (MoR) for your business, several key factors should be carefully considered: 1. It is the mechanism that reads a customer’s payment information. The traditional method of bringing payments in-house involves integrating a payment gateway or processor into the platform, allowing for seamless transactions within the platform. This means that businesses only need Stripe to accept payments and deposit funds into their business bank account. Further, by integrating payments functionality into a software. Beside simply reselling merchant accounts and serviced (as ordinary ISOs do), VARs provided consulting services, technical support, and even hardware solutions. Payment facilitator (payfac) A payment facilitator is an entity that is authorized to onboard merchants to an acquirer's platform and receive settlement funds for them on behalf of an acquirer. With Fortis’ PayFac solution, software developers and merchants can leverage award-winning APIs and leading payment technology to scale their business. When accepting payments online, companies generate payments from their customer’s debit and credit cards. ISO vs PayFac: PayFacs and ISOs play important intermediary roles in the payments ecosystem. 01274 649 895. This means businesses only need Stripe to accept payments and deposit funds into their business bank account. It makes you analyze all gateway features. Payfac solutions can be a critical source of revenue generation, allowing ISVs to differentiate their product and service offerings in a crowded space. Payfac and payfac-as-a-service are related but distinct concepts. United States. If your platform needs to operate internationally and support sub-merchants in other regions, partnerships with local acquirers, gateways, and other service providers may be necessary. ISOs mostly resell merchant accounts, issued by multiple acquiring banks. Payfacs with high standards and reliability based on the Visa's certification process may apply for two extended tiers: Visa Ready Payment Facilitator and Visa Trusted Partner. Renew payfac registration and licenses: Re-register as a payfac with card networks annually, and update or renew MTLs on the required cadence. June 3, 2021 by Caleb Avery. Cardknox Go (PayFac) – Become a Payment Facilitator, without the hassle;. Malaysia. In essence, they become a sub-merchant, and they face fewer complexities when setting. As a PayFac, Segpay handles the sub-merchant onboarding and provides a fully managed payment processing solution. Payment processing up and running in weeks. First popularized by firms like PayPal and Square, the payments facilitator (payfac) model is reshaping the payments ecosystem, allowing nonpayments companies that adopt it to participate more fully in the payments revenue stream. E-CommerceRenew payfac registration and licenses: Re-register as a payfac with card networks annually, and update or renew MTLs on the required cadence. Payment facilitators (PFs) were created to make a more streamlined path to electronic payment acceptance for small and medium-sized businesses. There is then additional time ensuring the payment gateway or application using the payment processing has all the appropriate merchant account credentials provisioned. UniPay Gateway is the leading Omnichannel payment processing and management solution for PayFacs, Saas and equity firms operating worldwide. At Revision Legal, we protect businesses that thrive online, and understand the connections between law, technology, and business. Potential risk of. However, PayFac concept is more flexible. Global expansion. 83% of card fraud despite only contributing 22. UniPay Gateway is the leading Omnichannel payment processing and management solution for PayFacs, Saas and equity firms operating worldwide. 25 per transaction. Onboarding processBefore offering customers payment methods from popular card networks (Visa, Mastercard, etc. A Payfac provides PSP merchant accounts. This model is ideal for software providers looking to. Payment Processors: 6 Key Differences. Gateway Features, Specific to Saas and PayFac Payment Platforms: Payment gateway integration. Our restaurant PayFac and gateway offer all of the features you need to ensure your payments are secure and on time. This way, you can let the PayFac worry. In order to provide a plausible explanation, we need to understand the evolution of the merchant services industry. becoming a payfac. A payment gateway is a software program that sits between the merchant and customer, often supplied and hosted by a third-party provider. Beyond a gateway, there are a number of technology systems PayFacs need to have in place to operate competitively. With the exception of processors catering to high-risk industry, they also offer month-to-month billing. Some Final Considerations: You will also need to find out about the third-party integration options, SDKs, and API functionality of the payment gateway. An ISO is a third-party company that refers merchants to acquiring banks or payment service providers. Popular 3rd-party merchant aggregators include: PayPal. The differences are subtle, but important. Payment facilitation (Payfac) is a service that allows businesses to accept payments from their customers in a variety of ways. per successful card charge. Also, many PSP’s/Payfac’s offer better integration with online businesses, as the payment gateway tends to be seamlessly bundled in. The PayFac then redistributes funds to its sub-merchants, and handles any future refunds or chargebacks. The Job of ISO is to get merchants connected to the PSP. A payfac is a platform that intermediates payments between consumers, payment operators (card operators, banks, PSPs, etc. Third-party payment providers If you're not using Shopify Payments and you want to accept credit cards, you can choose from over 100 credit card payment providers for your Shopify store. 40% in card volume globally. PayFac as a Force MultiplierWhat is a payment facilitator (payfac)? A payment facilitator (payfac) is a type of merchant services provider that simplifies the payment process for businesses. Visit our TSYS Developer Portal today and unlock the. It also means that payment risk is moved from individual merchants to the PayFac, as they own the master merchant account. Think debit, credit, EFT, or new payment technologies like Apple Pay. To clarify the matter, we will offer a clear and comprehensive explanation of what is a payment facilitator, its primary functions and business model in this complete guide. Connection timeout. Until recently, SoftPOS systems didn’t enable PINs to be inputted. Onboarding process In this guide, we’ll explore what a payment facilitator (often abbreviated as payfac or PF) is, examine the considerations and costs of different types of payfac solutions, and identify the best ways to add payments to a platform or marketplace. The best crypto payment gateways provide convenient interfaces for accepting multiple types of cryptocurrencies, flexible settlement options, and low fees. Payment Facilitation as a Service, also known as PayFac as a Service or PFaaS, allows software platforms and SaaS providers the ability to act as a merchant account for their end users. Instead of each individual business needing to set up its own merchant account, a process that can be time-consuming, the payfac effectively “rents out” merchant account functionality under its. That said, the PayFac is. The size and growth trajectory of your business play an important role. The entire operating cost, which includes the transaction cost, set-up cost, and admin cost, is the most crucial factor to consider. Operating on a platform that acts as a payfac means that there’s no need to work with an acquiring bank, payment gateway, and other service providers. Public Sector Support. Fortis also. Payfacs are entitled to distinct benefit packages based on their certification status, with. ISOs often provide a range of services, including equipment sales or leasing—for example, point-of-sale (POS) terminals —transaction processing, and customer service. You own the payment experience and are responsible for building out your sub-merchant’s experience. S. Global expansion. PayFac vs merchant of record vs master merchant vs sub-merchant. The 5 Best Crypto Payment Gateways For Businesses. Let’s discuss the most common marketplaces and platforms. . What SaaS & E-commerce Companies Need to Know About Payment Facilitator Regulations, and what key regulations govern their operation. Manage Your Payments. 20) Card network Cardholder Merchant Receives: $9. Stripe benefits vs. What is a payment facilitator (payfac)? A payment facilitator (payfac) is a type of merchant services provider that simplifies the payment process for businesses. A Payfac, or payment facilitator, is essentially a third-party payment system that allows businesses and organizations to receive and process online and in-store payments. It also needs a connection to a platform to process its submerchants’ transactions. The Payfac Solution Provider (PSP) handles all of the underwritings, setting up of accounts, development of integrations with processors, connections with gateway partners (if applicable), the. 4. By Ellen Cibula Updated on April 16, 2023. The payment facilitator model was created by the card networks (i. Payment gateway Payfacs provide a payment gateway, a software that acts as an intermediary between a business’s website and the payment processor. While both models allow businesses to accept payments, a payfac might provide additional services such as payment gateway integration, hardware for in-person payments, fraud protection, transaction reporting and customer support. As the merchant of record, a PayFac can aggregate and process the card payments for as many “sub-merchants” as they would like underneath their umbrella. It offers a secure pathway that requests and manages payment in order to take money from the customer and pass it into the merchant’s bank account. What’s the distinction between Payfac and PSP? A payment Facilitator is a third-party payment service provider (PSP). What is a Payment Facilitator (Payfac)? Payfacs are an evolution of a long-established distribution model in the payments industry. The ISO acts as an intermediary between the merchant and the payment processor, taking care of merchant recruitment, sales, and. A Payment Facilitator, or PayFac, is a sub-merchant account used by merchant service providers to provide payment processing services to their own clients, known as sub-merchants. The second type is a more modern, technology-first payfac solution from a commerce provider like Stripe. an ISO. You own the payment experience and are responsible for building out your sub-merchant’s experience. Stax (formerly called Fattmerchant), is a merchant services provider known for its subscription-based pricing and 0% markup on interchange rates. PayFac® solutions, at your service Worldpay from FIS is your advocate for payment facilitator solutions. Visa vs. I SO. With companies like Stripe, Square and PayPal pioneering the payment facilitator or “PayFac” model, the era of Integrated Payments 2. A payment facilitator is a merchant services business that initiates electronic payment processing. ISOs mostly. In many of our previous articles we addressed the benefits of PayFac model. Managed PayFac or Managed Payment Facilitation – The 2023 Guide. In recent years payment facilitator concept has been rapidly gaining popularity. Whether to become a Payment Aggregator or Payment Facilitator has far reaching implications for a SAAS application provider. It is when a business is set up as a primary merchant account and provides payment processing to its sub-merchants. PayFac Models. Payment Facilitator. 0 began. A PayFac will smooth the path. It then needs to integrate payment gateways to enable online. You own the payment experience and are responsible for building out your sub-merchant’s experience. You own the payment experience and are responsible for building out your sub-merchant’s experience. At first it may seem that merchant on record and payment facilitator concepts are almost the same. The difference is that a payment processor can provide a single gateway for multiple payment methods. It works by using one umbrella merchant account that allows every merchant to open as a sub-account underneath it. This is. Our suite of scalable issuer solutions provides the next generation platform for origination, processing and risk management. Instead of each individual business needing to set up its own merchant account, a process that can be time-consuming, the payfac effectively “rents out” merchant account functionality under its. The speed at which a merchant can start processing payments with a PayFac is vastly different than the rate at which this could be done in the legacy ISO model. Integrated Payments 1. merchant accounts. Onboarding processWhat is a payfac? A payfac or PF, short for payment facilitator, makes it possible for you to accept payments from customers in a variety of ways, including card payments, direct debits, local payment methods, and alternative payment methods like mobile and digital wallets including Apple Pay and Google Pay. As small business grows, MOR model might become too restraining, while payment facilitators provide robust APIs, which sometimes allow merchants to customize each function. To ensure the correct money flow, the payment. They offer payments to their merchant customers, known as submerchants, through their own links with payment processors. A payment facilitator (payfac) is a type of merchant services provider that simplifies the payment process for businesses. Global expansion. Sub-merchants operating under a PayFac do not have their own MIDs, and all. In a PayFac model, however, the merchant will establish a business relationship with the payment facilitator, and it is the latter who will maintain the relationship with. Meanwhile, PayPal and Square collectively generated revenues of $22 billion. For SaaS providers, this gives them an appealing way to attract more customers. Payfac-as-a-service vs. Firstly, it has a very quick and easy onboarding process that requires just an. With UniPay Platform you have the options of an affordable white label payment gateway solution, a full on-premise software license (including the source code), which ensures the top-quality payment processing. Suspicious and fraudulent identification. RevSpring leads the market in financial communications and payment solutions that inspire action—from the front-office to the back office to the collections office. When you enter this partnership, you’ll be building out. ,), a PayFac must create an account with a sponsor bank. Some say, a VAR is an evolutionary stage between a traditional ISO and a SaaS provider. 4. In other words, ISOs function primarily as middlemen (offering payment processing), while. One key difference between payment facilitators and aggregators is the size of businesses or merchants they work with. NerdWallet rating. Moreover, in a sense, PayFac model relieved acquirers from merchant management functions, which they delegated to PayFacs. Gateway Service Provider. We could go and build a payment gateway, but there would be a. a merchant to a bank, a PayFac owns the full client experience. The core of their business is selling merchants payment services on behalf of payment processors. Under the PayFac model, each client is assigned a sub-merchant ID. This means that businesses only need Stripe to accept payments and deposit funds into their business bank account. You'll need to submit your application through Connect . 0. However, businesses of all sizes can gain profit from UniPay PayFac Model, as it provides a mere and efficient way to accept payments. One of the key differences between payment aggregators and payment facilitators is the size of sub-merchants they are servicing. While both models allow businesses to accept payments, a payfac might provide additional services such as payment gateway integration, hardware for in-person payments, fraud protection, transaction reporting, and customer support. High transaction costs, complex fee structures, and the need for seamless payment solutions have become. Instead of each individual business needing to set up its own merchant account, a process that can be time-consuming, the payfac effectively “rents out” merchant account functionality under its. In this case, it’s straightforward to separate the two. Most important among those differences, PayFacs don’t issue. PayFac has its own secure gateway, and it provides easy integration with major e-commerce shopping carts. Traditional payment facilitator (payfac) model of embedded payments. 1. Becoming a full payfac typically requires an agreement with a sponsoring merchant acquirer such as Worldpay, registering as a payfac with the card networks, becoming compliant with the Payment Card Industry Data. A PSP, on the other hand, charges a variable fee in addition to the fixed fee. 1. An ISO works as the Agent of the PSP. ISOs. When you want to accept payments online, you will need a merchant account from a Payfac. This license, only the second…PayFac, which is short for Payment Facilitation, is still a relatively new concept. When this happens, your business can make and receive payments online using third-party payment networks (Venmo, PayPal, etc. The best Stripe competitors combine transparency, low processing fees, and excellent support for eCommerce. The terms aren’t quite directly comparable or opposable. Onboarding process responsible for moving the client’s money. Set up Wix Payments. The PSP in return offers commissions to the ISO. 70. Our payment-specific solutions allow businesses of all sizes to. 🌐 Simplifying Payments: PayFac vs. In other words, processors handle the technical side of the merchant services, including movement of funds. The platform becomes, in essence, a payment facilitator (payfac). As a PayFac, Segpay handles the sub-merchant onboarding and provides a fully managed payment processing solution. If your platform needs to operate internationally and support sub-merchants in other regions, partnerships with local acquirers, gateways, and other service providers may be necessary. Instead of each individual business needing to set up its own merchant account, a process that can be time-consuming, the payfac effectively “rents out” merchant account functionality under its. What is a payment facilitator, and what is payfac-as-a-service? Here’s what businesses need to know about how payfac solutions work. Typically a payfac offers a broader suite of services compared to a payment aggregator. A merchant of record (MoR) is the entity that is authorized, and held liable, by a financial institution to process a consumer’s credit and debit card transactions. Gain a higher return on your investment with experts that guide a more productive payments program. This means businesses only need Stripe to accept payments and deposit funds into their business bank account. 10 to $0. At TSYS, we’re building the future of payments. Payfacs work by having a master merchant account (and a master MID) through its relationship with acquiring banks. Payfacs are a type of aggregator merchant. All transactions are aggregated under one master merchant account and all funds are settled in the PayFac’s bank account. Instead of each individual business needing to set up its own merchant account, a process that can be time-consuming, the payfac effectively “rents out” merchant account functionality under its. There is no paperwork involved, and no separate bank accounts with all the headaches involved with that. A payment facilitator (or payfac) is the owner of a master merchant identification number who registers merchants as sub-merchants and enables their payment acceptance. Payment facilitation helps you monetize. Simplify funding, collection, conversion, and disbursements to drive borderless. Stripe, a tech-enabled evolution on the traditional payfac model, offers a complete solution that combines the functionality of a merchant account and a gateway all in one. This means that businesses only need Stripe to accept payments and deposit funds into their business bank account. A relationship with an acquirer will provide much of what a Payfac needs to operate. In the world of payment processing, the turn of the decade represented a massive transition for the industry. Independent Sales Organization (ISO) Provides specific services directly orGateway Selection for SaaS and PayFac Payment Platforms; Best Crypto Payment Gateway Solutions for Platforms; How PayFac Model Increases Your Company’s Valuation; Payment Advice. No setup fee. Gateway Selection Tips for SaaS and PayFac Payment Platforms In order to provide. If you're using a direct provider, your customers can. The PayFac model has gained popularity in recent years, as it allows businesses to simplify their payment processing and reduce costs, while also providing a better customer experience. PayFac and online marketplace models do not compete, they are just intended to serve slightly different purposes. The main difference between the two entities is that one is a company that facilitates payments, and the other is a piece of software that integrates into a website or payment portal. A payment facilitator (PayFac) is a merchant services business that sets up electronic payment and processing services for business owners, so they can accept electronic payments online or in-person. Acquirer = a payments company that. Seamless graduation to a full payment facilitator. Access Worldpay uses cloud-based, RESTful JSON APIs for simple integration of online payments. The payment gateway provider must be able to offer you the liberty to get anyone on board and do business with them. 01274 649 893. Becoming a payment facilitator is a change to your operational and support models, has and it pays long-term benefits. slide 1 to 3 of 3. Find the Right Online Payment Gateway. The TPA categories are listed in the table below. You own the payment experience and are responsible for building out your sub-merchant’s experience. Global expansion. Payfac-as-a-service vs. Payment gateway Payfacs provide a payment gateway, a software that acts as an intermediary between a business’s website and the payment processor. Some ISOs also take an active role in facilitating payments. Amazon Pay. Payfac as a Service is the newest entrant on the Payfac scene. At the same time, more companies are implementing PayFac model and establishing PayFac payment gateway partnerships. Payment gateway: Offers customization options to align with the business’s branding and user experience, focusing primarily on secure data transmission and transaction authorization. This crucial element underwrites and onboards all sub. More importantly, merchants that use those platforms do not need a direct relationship with a payment gateway or the acquiring bank. PayFacs take care of merchant onboarding and subsequent funding. Global expansion. The easy-to-use and instantaneous nature of the Payment Facilitator makes it such a popular choice among merchants. Firstly, a payment aggregator is a financial organization that offers. S. Classical payment aggregator model is more suitable when the merchant in question is either an. Moreover, in a sense, PayFac model relieved acquirers from merchant management functions, which they delegated to PayFacs. It also means that payment risk is moved from individual. See Creating a Batch Request . This crucial element underwrites and onboards all sub-merchants. Gateway Service Provider. The Job of ISO is to get merchants connected to the PSP. While an ISO product will sometimes take weeks to approve a merchant due to the more stringent and quite often paper-based application process, PayFacs are able to. The full-function platform has been designed to deliver Acquirers with a comprehensive Third Party Payment Facilitator programme, as well as a. Gateway. Onboarding processA payment facilitator (or PayFac) is a payment service provider for merchants. But regardless of verticals served, all players would do well to look at. Instead of each individual business needing to set up its own merchant account, a process that can be time-consuming, the payfac effectively “rents out” merchant account functionality under its larger master merchant. Finally, web. A Payment Facilitator, PayFac for short, is simply a sub-merchant account for a merchant service provider. When PayFac became a buzzword among software platforms and the many businesses trying to sell to them, the meaning of the word started to blur. It is significantly less expensive compared to using a regular PayFac model. When you’re using PayFac as a service, there are two different solution types available. You own the payment experience and are responsible for building out your sub-merchant’s experience.