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What is a payment processor?

pay - ment pro - ces - sor
noun

A payment processor is a company with the authorization to handle payment transactions, such as credit cards, digital wallets and bank transfers, acting as the intermediary that facilitates smooth and secure transactions between merchants and customers. This crucial role ensures that the financial exchange between buyers and sellers is executed successfully.
 

What Is a payment processor's role in payments?

Payment processors play an important role in facilitating online transactions for merchants, allowing them to accept debit or credit card payments. These processors establish a link to an acquiring bank, enabling the validation and approval of transactions. They also incorporate anti-fraud measures to ensure the authenticity of transactions, safeguarding against potential risks. These processors adhere to rigorous standards and regulations set forth by credit card associations, which cover areas such as fraud prevention, handling chargebacks and protecting against identity theft.