Payment Service Provider
A Payment Service Provider (PSP) is a third-party company that facilitates online payment processing for merchants by connecting them to various payment methods and financial networks. It handles the technical and security aspects of transactions, including authorization, settlement, and fraud prevention, allowing businesses to accept payments without building their own payment infrastructure. PSPs typically offer APIs and integrations for e-commerce platforms, mobile apps, and point-of-sale systems.
Developers should learn about PSPs when building applications that require payment processing, such as e-commerce sites, subscription services, or mobile apps with in-app purchases. They are essential for handling secure transactions, complying with regulations like PCI DSS, and supporting multiple payment methods (e.g., credit cards, digital wallets) without managing complex banking integrations. Using a PSP reduces development time and risk compared to building a custom payment system.