PSP

A regulated entity that processes payments on behalf of merchants, typically holding funds in transit. Distinct from an acquirer (which holds the merchant agreement and licence) and from an introducer (which connects merchants to acquirers but does not process). Many PSPs are licensed as Payment Institutions (PIs) under PSD2.

In practice.

PSP is the broadest label in the stack, covering everything from pure gateways to full acquirers. When evaluating one, ask what it actually holds: the acquiring licence, the settlement funds, the underwriting decision, or just the technology. The answer determines who you really depend on.

Related terms: Acquirer · Aggregator · Introducer · PSD2