A gateway captures the payment details and passes them on. A processor moves the transaction through the card networks. An acquirer holds the licence that lets money be settled to a merchant, and a payment facilitator sells all three to you as one product under its own acquiring arrangement. For most small businesses only the last of those names appears on a contract.
In this article
The short version
- Mastercard defines a payment facilitator as "a service provider that is registered by an acquirer to facilitate transactions on behalf of submerchants", under Rule 7.8 of the Mastercard Rules. Sign up to a modern payments product and you're the submerchant, so your contract is with the facilitator and the acquiring relationship behind it belongs to somebody else.
- The party holding your funds can hold some of them back. Stripe's services agreement defines a Reserve as "collateral funds which Stripe holds and controls to satisfy any liabilities or potential liabilities User incurs under this Agreement".
- Nobody in the chain sets your whole rate. Interchange is capped by law on consumer cards, scheme fees are not, and only your provider's margin is negotiable.
- Where a provider acts as an agent of an authorised payment institution, the FCA's guidance is that "An agent can only provide its principal's payment services", and the principal registers the agent. So the register tells you whose permission you're relying on.
- Switching gateways is invisible to a card payer. Switching direct debit provider is not, because the mandate lives with a scheme.
The five roles, and which one you contract with
Five roles exist in a card payment. You will normally contract with one of them.
| Role | What it does | Do you contract with it? |
|---|---|---|
| Gateway | Captures card details and passes them on securely | Only if you buy it separately |
| Processor | Sends the transaction through the card networks and returns the answer | Rarely, and usually through somebody else |
| Acquirer | Holds the scheme licence and settles the money to a merchant | Yes, if you hold a merchant account in your own name |
| Payment facilitator | Sells the whole chain as one product and onboards you as a submerchant | Yes, in almost every self-serve product |
| Card scheme | Sets the rules and the interchange the issuer receives | No, never directly |
The words blur because one company often plays several of these roles and buys in the rest. Asking a provider which of them it performs itself tends to be more revealing than asking what the product is called.
Gateway against processor
Historically these were two purchases: a gateway to take the card details on your website, and a merchant account from an acquirer to receive the money. Two contracts, two bills, two support numbers.
Buy a payments product today and the gateway is inside it, so the distinction describes what happens in the seconds after your customer taps Pay and leaves you nothing to decide.
It still bites at the edges. If you already have an acquiring contract you're happy with, a standalone gateway lets you keep it and change the checkout. And when a payment fails, knowing that capture and authorisation are separate steps helps you read the error: a declined card is the issuer's answer, while a payment that never reached authorisation is usually a configuration problem at your end.
Who holds the merchant agreement
Marketing pages tend to leave this distinction out, and it has real consequences for you.
Under a facilitator you're a submerchant. Mastercard's own wording is that a payment facilitator is "a service provider that is registered by an acquirer to facilitate transactions on behalf of submerchants", governed by Rule 7.8 of the Mastercard Rules. An acquirer registered the facilitator. The facilitator signed you up.
Three things follow.
- Your commercial terms are the facilitator's terms and can change by notice, as any supplier's can. You have no direct relationship with the acquirer or the schemes.
- Your acceptance depends on somebody else's licence. If the facilitator changes or loses its acquiring arrangement, your ability to take cards moves with it.
- Underwriting decisions about you are taken by a party you never contracted with, so a sector one facilitator declines can be perfectly acceptable at another.
That lighter registration is also why you could be live today. With a merchant account in your own name you're the merchant of record and the terms are in a contract you signed: more work up front, more control afterwards. Our guide to accepting card payments compares the two routes on onboarding and pricing, and on where a dispute lands.
Regulation follows a similar pattern. Where a provider acts as an agent of an authorised payment institution, the FCA is blunt: "An agent can only provide its principal's payment services; the agent cannot provide or purport to provide the services in its own right", and the principal registers the agent. So the Financial Services Register, checked for the provider and for whoever it names as its principal or partner, tells you where the permission lives. Adfin delivers payment services through FCA-regulated partners and names them: Adyen N.V., Stripe Payments Europe Ltd and Tink Financial Services Ltd.
Who can hold your money back
Whoever settles money to you can decline to settle all of it, and the mechanism has a name. Stripe's services agreement defines a Reserve as "collateral funds which Stripe holds and controls to satisfy any liabilities or potential liabilities User incurs under this Agreement", and allows it to "deduct, recoup or setoff" amounts from a Reserve, from funds payable to you or from your balance. The same agreement allows immediate suspension of the services in defined circumstances.
Clauses of that shape are normal across the industry, so reading them matters more than avoiding them. Your recourse changes with the model. Under a facilitator you argue a decision about your funds with your counterparty. With your own merchant account, a reserve is a term you negotiated, so there's something specific to hold the acquirer to. Either way, ask what would trigger a hold and how long one would last.
Who sets your rate, and who you call
Nobody sets your whole rate. The regulator describes the merchant service charge as comprising "interchange fees, scheme and processing fees and acquirer net revenue" (Payment Systems Regulator). Interchange goes to the card issuer, capped by law on consumer cards. The schemes charge uncapped fees of their own. Only the margin belongs to whoever is selling to you, and only that margin is on the table when you negotiate. Our guide to what it really costs to take payments works through all three.
Support follows the contract. Under a facilitator you have one number to call and one party accountable for the answer, though when the failure is deeper in the chain you're waiting on their supplier. With an unbundled stack you can go straight to the party responsible, and the diagnosis becomes your job. For a small business one accountable supplier is usually worth more than a shorter path to the right engineer.
What happens to your customers if you switch
Card and direct debit behave completely differently here, and that decides how much of a switch your customers ever see.
A card payer notices nothing. Send an invoice with a new payment link and it works, because no standing permission is held on your behalf. Saved cards are the exception: details stored by your old provider may not be portable, so a customer paying on file might have to enter the card once more.
A direct debit payer is on a mandate, and mandates belong to the Bacs scheme through a Service User Number. Moving them means either a bulk change that transfers existing mandates with nothing for your customers to sign, or asking them to sign a new mandate. Advance notice applies either way. Our guide to moving an existing client base onto direct debit covers both routes.
The distinctions that change nothing for you
Some of these words earn their keep in a procurement conversation and nowhere else.
Gateway against processor, when you're buying one product. That boundary is internal to your supplier.
Which acquirer sits behind your facilitator. Worth knowing it exists, and it doesn't change your pricing, onboarding or support route.
Whether authorisation and capture happen together or separately. Relevant if you take a deposit and charge later, otherwise invisible.
Payment service provider against payment processor as terms. Used interchangeably in UK marketing, with no consistent distinction to hold anyone to.
The scheme routing your transaction. You can't influence it and it doesn't change what you're paid.
What does change things is narrower than the vocabulary suggests. Who you contract with, who settles your money, who can hold it, who prices you, and who answers the phone. Any provider can answer those five in writing, and it's fair to ask.
Common questions
What's the difference between a payment gateway and a payment processor? The gateway captures the payment details and passes them on. The processor sends the transaction through the card networks and returns the answer. Buy one modern payments product and both are inside it.
Do I contract with the acquirer or with the provider I signed up to? With the provider, in almost every self-serve product. Mastercard describes a payment facilitator as a service provider registered by an acquirer to facilitate transactions on behalf of submerchants, so the acquiring relationship belongs to the facilitator and you're the submerchant.
Who can freeze or hold my funds? Whoever settles money to you. Stripe's services agreement, for example, defines a Reserve as collateral funds it holds and controls against your potential liabilities, and allows it to deduct amounts from a reserve, from funds payable to you or from your balance.
Who decides the rate I pay? Three parties between them. The schemes set interchange, capped by law on consumer cards, and their own processing fees, with no cap. Your provider sets its margin, and that margin is the part you can negotiate.
Will my customers notice if I change payment provider? Card payers usually won't, because a new payment link simply works. Customers with a saved card may need to enter it again, and direct debit customers are on a mandate, so moving them needs a Bacs bulk change or a new mandate signed.
Do I need to check that my provider is regulated? It's a reasonable check. Where a provider acts as an agent, the FCA's guidance is that an agent can only provide its principal's payment services and the principal registers the agent, so the Financial Services Register shows you whose permission the service runs on.
Sources
- FCA Handbook — PERG 15.4, agents of payment institutions (accurate as of August 2026)
- Mastercard — payment facilitators (accurate as of August 2026)
- Stripe — Services Agreement (accurate as of August 2026)
Reviewed by the Adfin team. This article explains how the parties in a UK payment chain relate to each other and is not legal or financial advice. Scheme rules and provider terms change; read your own agreement and check current guidance before relying on either. Last updated August 2026.
