What does merchant of record mean?
The merchant of record is the legal entity that sells to the buyer: the name on the checkout, the receipt and the card statement. It collects and remits sales tax or VAT, handles refunds and chargebacks, and must follow consumer law for that sale, even when another company made the product.
In detail
The merchant of record is the legal entity that sells to the buyer: the name on the checkout, the receipt and the card statement. It collects and remits sales tax or VAT, handles refunds and chargebacks, and must follow consumer law for that sale, even when another company made the product.
What are the risks of being the merchant of record?
The MoR is liable for everything sold under its name. The 2025 FTC case shows where that ends. The agency alleged that the provider opened merchant accounts claiming to be a “merchant of record” or software “reseller”, then used them to process for many unrelated merchants, some of them running fake virus alerts.
Is a merchant of record worth it in 2026?
For a PSP, PayFac or SaaS platform, the answer is usually the opposite: keep each seller as the merchant of record, onboard it properly, show its name on the statement, and provide the tax, payout and dispute tooling around it. The 2025 FTC settlement is the reminder: whoever signs the sale answers for it.
More detail in our #PayDecoding episode on Merchant of record.