A payment aggregator is a payment service provider (PSP) that processes merchants' payments directly under its own master merchant account. This arrangement allows merchants to accept credit and debit card payments for their e-commerce stores without the need for a dedicated merchant account.

How do payment aggregators make money?

Aggregator has to compensate banks or merchant if a fraudulent transaction is attributed to it and such cases impact merchant's revenue /margins badly. Imagine if there is fraudulent transaction of Rs. 10,000 then aggregator has to process INR 1Crore GMV to compensate that single loss.

What is aggregator in payment processing?

A payment aggregator is a payment service provider that allows merchants to accept debit or credit card e-commerce payments without having to go through a bank. ... Aggregation is a payment facilitator that differs from the traditional model. This is why smaller businesses benefit the most from these payment providers.