A Payment Service Provider (PSP) is a financial institution that empowers merchants to accept a range of payment methods through a payment gateway. The PSP works in close relationship with acquiring banks (payment processors) to manage the transaction from the user’s click to the merchant’s payout. The PSP oversees every process from the moment the clients input their credit card data, to the moment the funds are transferes to the merchant’s bank account.
Payment gateways continue to initiate significant transformations in how financial transactions are done. For instance, Accenture says that in the ongoing expansion of the payments space, the key to success is customer experience. This means the emerging need for businesses to provide invisible and frictionless payment transactions.