A payment aggregator, also known as a merchant aggregator, is a third-party service provider that allows companies to accept payments from customers by integrating payment processing into their websites or mobile apps. A merchant aggregator is another name for this kind of aggregator.
Payment aggregators are perhaps more suited for small companies with modest transaction volumes than other payment service providers since they employ a master merchant account to operate as an umbrella for sub-merchant accounts. This differs from the old technique, which requires each merchant to have their merchant account. The second scenario, with its higher rates, higher transaction volumes, and chargebacks, might soon overwhelm a small firm.
The following are some examples of payment aggregators and gateways:
A Payment Gateway cannot provide or provide a Payment Aggregator as a service, while a Payment Aggregator may offer or provide a Payment Gateway. Payment Gateway Aggregators such as PayUMoney, Instamojo, Citrus, Billdesk, and CCAvenue are just a few examples accessible today. For the online Payment Gateway services that they provide to a range of shops, these companies charge different charges.
These service providers gather money from consumers or users on behalf of the merchant and transmit it to the merchant’s account after a specified length of time, which is usually three days, has elapsed, depending on the Payment Aggregators Policies.
The following are the categories of payment aggregators in India:
In India, an online payment aggregator may be either a commercial platform or a bank-sponsored payment aggregator.
- Payments from Third Parties Aggregator
Breaking news: sales via internet merchants are increasing at an unprecedented rate. Sales produced via internet shopping are expected to exceed USD 5.4 trillion by the year 2022. Despite the pandemic, India had a 36 percent increase in eCommerce orders in the fourth quarter of 2020.
Third-party payment administrators (TPAs) are popular among businesses because of their creative payment solutions. Furthermore, they provide user-friendly features such as a dashboard, exceptional customer care, and a painless onboarding process.
- Bank Payment Aggregator –
These payment aggregators are expensive to set up and difficult to integrate into current systems. Their list of authorized payment options is limited. Furthermore, there are no reporting or analytics tools accessible.
They are not ideal for start-ups and smaller enterprises since they may prove to be costly in the beginning. Major corporations that wish to interact with a variety of service providers often employ bank payment aggregators.
There are several advantages to employing a payment aggregator.
Businesses may save time and money by using a payment aggregator. The first distinction is that setting up a payment aggregator account involves minimal paperwork, but setting up a merchant account is time-consuming and complex, requiring a variety of documents. The bulk of the time, when a firm uses a payment aggregator, it is able to start accepting payments sooner.
Furthermore, most payment aggregators charge a one-time fee for their services, and this not only makes budget management easier for corporations, but it also saves them money. Furthermore, most payment aggregators are eager to engage with consumers on a short-term basis. As a result, the cost is substantially cheaper in the short term than utilizing merchant accounts.
Conclusion-
When it comes to the payment process, the certifying banks are in charge of underwriting and the money transfer process for numerous merchants. They have an edge when it comes to processing transactions on the front end, while banks are in charge of granting merchant accounts on the back end. Payment Aggregators’ underwriting is handled by the acquiring bank, and payment processing is done with the use of a MID (Merchant Identification Number) or a number of MIDs from different other intermediaries or parties involved in the transaction.
