What is an acquirer?

An acquirer is a financial institution that acts as an intermediary between merchants and card payment networks such as Visa and Mastercard. Sometimes merchants work directly with acquirers. Alternatively, they can work through other companies such as merchant service providers.

Examples of acquirers

Based on purchase transactions from 2015 to 2020, the biggest acquirers in the USA are:

• Chase
• FIS/Worldpay
• Wells Fargo
• Elavon
• Vantiv
• Fiserv (formerly known as First Data)
• Global Payments
• Bank of America
• TSYS
• Heartland

Technically, the term “merchant acquirer” refers specifically to financial institutions that acquire (supervise) merchants that accept card payments. Acquirers ensure that merchants operate within the law and the contractual terms of the payment card network.

In practice, the term “acquirer” is often used to describe other companies working in the area of payment card acceptance. The reason for this is that many companies can fulfill more than one role.

For example, many acquiring banks also offer payment processing services. This means that they can handle the technical side of card transactions.

Similarly, merchant service providers are usually processors rather than acquirers. They do, however, often fulfill an acquirer’s responsibilities.

Why you need a merchant acquirer

You need an acquirer to be able to take card payments. Most acquirers will support debit cards and credit cards from both Visa and Mastercard. Some acquirers will also support more niche card networks such as American Express, Diners Club, Discover, and China UnionPay.

How to choose a merchant acquirer

Below are four main points to consider when looking to open a merchant account with an acquiring bank.

Do they offer what you need?

Before you start to look for a merchant acquirer, make a list of what you need that acquirer to deliver. For example, think about:

• which cards you want to accept
• if you want to offer e-commerce or just take payments in-store
• whether you want to take cross-border payments
• whether you want to take recurring payments
• whether you need your acquirer to support other partners (such as merchant service providers) or technology (such as online checkout software)

Do you look like a good fit for them?

If you identify that a merchant acquirer looks like a good fit, it’s advisable to think about whether or not you look like a good fit for them. In particular, be aware that some acquiring banks may decline to take on merchants they consider to be high-risk.

An acquiring bank’s website will provide guidance. If that’s not enough, contact them for an opinion before making a formal application.

Do they have a good reputation for customer service?

Firstly, check what support they offer as standard. In particular, see if they have a phone number and, if so, what hours it operates.

Secondly, look at what companies similar to yours have to say about their customer service.
Be very wary of signing a contract with an acquirer with a poor reputation for customer service - even if they offer low fees.

Do their fees offer you good value for money?

The key to working out if a prospective acquirer’s fee structure offers good value for money is to have a clear idea of how you expect your card acceptance to work.

Specifically, you want a relatively accurate estimate of the volume and value of the transactions you expect to take. It’s also useful to have an idea of the specific type(s) of cards you expect cardholders to use.

As a rule of thumb, if you expect to take a significant number of transactions, it generally makes sense to look at committed tariffs. These usually offer the lowest costs.

If you expect to take a limited number of transactions, however, pay-as-you-go is generally the better choice.