If you want to accept payments online it is most likely that you will have to rely on some third party payment processor. Three types of third payment processors can be pointed out, namely, a payment service provider (PSP), a payment facilitator and a payment aggregator. Often these terms are used as synonyms but in the reality there are some differences between them.
A payment service provider provides merchants with individual merchant accounts and helps them with underwriting and payment processing, but it is important to point out that in this case merchants are funded directly by the acquirer. A payment facilitator utilizes the same model of cooperation. Every merchant gets a MID but the difference is that a payment facilitator funds merchants directly. A payment aggregator is a company targeted at small businesses; it has many small merchants in its portfolio and processes payments for them through one MID. In order to understand better how payment processing is organized in every specific case have a look at the diagram below.