Podcast: Underwriting Submerchants – How Responsible Are Acquirers?

Last week, we spoke with Deana Rich about the special considerations behind underwriting payment facilitators. This week we take our focus on underwriting in the payment facilitator space a step farther. We talk with Eric Haru, executive vice president, Risk and Compliance, for Merchant e-Solutions about underwriting submerchants.

Haru reminds acquirers that they remain responsible to make sure regulations are followed. “The fact that these are submerchants doesn’t alleviate you from complying with relevant regulations that protect the ecosystem,” he said.

However, one of the challenges for acquirers working with payment facilitators and submerchants is the fact that the acquirer is a step removed – the submerchants are actually the clients of the PF. That means that acquirers must pay special attention to providing the proper oversight without being disruptive to the PF / submerchant relationship.

“All the things you do for a direct merchant need to be done, it’s just a matter of who’s going to do it and getting comfortable with who’s doing it,” he said.

Haru talks about this and other unique aspects of underwriting submerchants in this week’s podcast.