The merchant acquiring bank and the merchant account provider work hand-in-hand and simultaneously in e-commerce, but do different things. The merchant acquirer is the bank selling acceptance services to merchants and assuming financial risk in acquiring a merchant’s payment card transactions.
The merchant account provider is a third party that provides the merchant account and its functions: the connection to the payment networks, the transmission and security of data and settlement. The provider is the party actually fueling the transaction.
In a credit or debit card transaction, the merchant sends the details of the transaction to the acquiring bank, which relays the details to the consumer’s bank (commonly called the card issuing bank). The card issuing bank approves the payment to the acquiring bank (while keeping a small sum called the interchange fee), and the funds are then transferred from the acquiring bank to the merchant account. The acquiring bank also keeps a small fee (called the merchant services fee).
The merchant account provider is accountable for setting up the merchant account through the acquiring bank.