Merchant of Record, Stripe, or your own merchant account — what’s the real difference, and why does it matter?

In this video, Maria breaks down the key differences between using a payment service provider like Stripe, a Merchant of Record setup, and having your own merchant account. While all three allow you to accept credit cards, they are fundamentally different in how risk, liability, control, and scalability are handled.

Maria explains how each option works, when each makes sense, and why the “as long as I can accept payments” mindset often leads businesses into dead ends as they grow. From legal seller implications and account ownership to scalability, flexibility, and long-term success, this video will help you choose the right payment setup for your business — and know when it’s time to make a switch.

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🎯 Key Concepts Covered

🟩 Payment Service Providers (PSPs)

Platforms like Stripe that allow businesses to accept payments under a master merchant account. You don’t own a MID, approvals are fast, but control, flexibility, and risk tolerance are limited.

🟩 Merchant of Record (MoR)

A third party that becomes the legal seller of your product. The MoR manages payments, compliance, taxes, and chargebacks, while the business gives up ownership and control of the payment relationship.

🟩 Merchant Accounts (Your Own MID)

A direct relationship with an acquiring bank where the business is the legal seller and owns the MID. This setup offers the most control and scalability but carries full responsibility for risk and compliance.

🟩 Merchant Category Codes (MCCs)

A four-digit code used by card networks to classify your business. MCCs affect approvals, pricing, monitoring, and risk treatment.

🟩 Liability & Risk Ownership

Responsibility for chargebacks, fraud, taxes, and compliance differs by setup. PSPs enforce strict controls, MoRs assume seller liability, and merchant account holders carry full responsibility.

🟩 Scalability Constraints

Each model has built-in limits that can restrict growth as volume, risk, and operational complexity increase.

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Thanks for watching! If payments, approvals, or processor issues are slowing your business down, that’s exactly what we help with at DirectPayNet. Our team works with online businesses to create payment setups that actually support growth. Contact us!

#220 The Best Payment Setup For Your Business

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