Comparison
PayFac vs. ISO / Agent Model
Two ways to distribute payment acceptance. PayFac makes you the master merchant — more economics, more liability. ISO/agent makes you a referral partner — less economics, less risk. The right answer depends on your volume, product, and appetite for operational complexity.
The Key Distinction
PayFac puts you in the payment chain. ISO/agent keeps you outside it. That structural difference determines everything else.
| Dimension | PayFac | ISO / Agent |
|---|---|---|
| Your role | Master merchant — sub-merchants under you | Referral partner — merchants sign directly |
| Revenue capture | Full margin between acquiring cost and pricing | Residual share — typically 20–50 bps |
| Chargeback liability | Yes — you own sub-merchant losses | No — processor owns liability |
| Underwriting | You underwrite sub-merchants | Processor underwrites merchants |
| Onboarding speed | Fast — you control onboarding | Slower — processor approval required |
| Right for | Vertical SaaS, marketplaces, $3M+ monthly | Low-volume, high-risk merchants, early stage |
Not sure which model fits your program? Tell us your volume, product requirements, and current infrastructure. We'll tell you which structure makes sense and what the economics gap looks like.
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