A merchant who signs a contract with a payment service provider in order to obtain payment services.
It is the job of the sponsored merchant to clear its transactions through a payment service provider. This process is known as the merchant of record within the payment system for the transaction that is carried out. There are certain steps that you need to take in order to become a sponsored merchant.
Becoming a sponsored merchant is suitable for certain businesses that don’t qualify for the more rigorous requirements to become a direct merchant. These include unregistered businesses, merchants who may have been terminated by the Card Associations, high-risk businesses, and start-ups or inexperienced businesses.