Payment Service Provider (PSP)
A payment service provider, or PSP as they are oftentimes called, is
a company that accepts electronic payments for making purchases or money
transfers. The PSP will connect to a bank, credit card company or a
payment network and facilitate the transfer. The PSP might handle everything
so that the merchant and the financial institution don’t have
to worry about the connection.
Some people refer to the PSP as a payment gateway but the better definition
is payment service provider. Some of the PSP companies will go beyond
the basics and also offer other services like fraud protection, risk
management, prepaid cards, etc.
You may not even realize that there are more than 900 payment service
providers around the world. There are more than 300 that offer services
for North America and Europe. Two of the most well known payment service
providers are Neteller and Skill. They have been providing online payment
methods for their customers for more than a decade.
The next time you transfer money online there is a very good chance
you will be using a payment service provider. It might be one that has
been around for a long time like Neteller or it might be one of the
newer ones like ecoPayz or Ukash. Whatever your choice, it is nice to
know that payment service providers allow customers to send and receive
money online in a matter of moments.