In today’s borderless eCommerceeCommerce ecommerce Commercial transactions conducted electronically on the internet. Includes digital payments, shopping carts, and fraud prevention. world, brands are eager to reach global audiences. But with great opportunity comes great complexity: taxes, compliance, fraudFraud fraud Criminal deception involving unauthorized payments or use of financial credentials., local currencies, and regulations can all become major roadblocks. That’s where the MerchantMerchant merchant An individual or business that accepts payments in exchange for goods or services. of Record (MoR) model comes in.
What Is a Merchant of Record?
A Merchant of Record is the legal entity responsible for selling goods or services to the end customer. This means they process the payment, manage taxes, handle chargebacks, ensure compliance, and issue the invoice—not the original retailerRetailer retailer A merchant that sells goods or services directly to consumers..
Think of the MoR as a local proxy who assumes all the heavy lifting for you in every country you sell in.
How MoR Works
When a customer places an order:
- The MoR collects payment in the customer’s local currency
- The MoR handles tax collection (VAT, GST, Sales Tax) and compliance (PCI, GDPR, PSD2)
- The MoR pays out the net proceeds to your business after deducting fees and taxes
- The customer sees the MoR name (or a custom descriptor) on their card statement
MoR vs Traditional Cross-Border Selling
| Feature | MoR Model | Self-Managed International Shipping |
|---|---|---|
| Legal entity in country | Not needed | Usually required |
| Tax registration (e.g., VAT) | MoR handles it | Retailer must handle |
| Currency & FX | MoR localizes | Retailer exposed to FX risk |
| Payment acceptance | Higher, MoR uses local acquiring | Lower, depends on PSP setup |
| Compliance (PCI, GDPR, PSD2) | MoR is responsible | Retailer bears full burden |
| Fraud & chargebacks | MoR handles disputes | Retailer is liable |
Why Use a Merchant of Record?
1. Expand Globally Without Borders
Selling in Europe, Asia, LATAM, or the Middle East? An MoR lets you do this without setting up legal entities or worrying about tax registration.
2. Eliminate Tax and Compliance Headaches
MoRs manage sales tax, digital services tax, GDPR, KYC, and other local laws—so you don’t have to.
3. Improve Conversion Rates
Localized checkout with local currencies and payment methods (like iDEAL in the Netherlands or Pix in Brazil) reduces cart abandonment.
4. Reduce Risk
MoRs handle chargebacks, refunds, PCI-DSS compliance, and fraud screening—protecting your balance sheet and operations.
5. Go to Market Faster
Test and launch in new markets within days, not months. MoRs are ideal for D2C brands, SaaS companies, and marketplaces looking to scale quickly.
Top Global MoR Providers
| Provider | Region Focus | Sector Specialization | Website |
| Paddle | Global | SaaS, Software, Digital Goods | paddle.com |
| FastSpring | Global | Software, Digital Goods, SaaS | fastspring.com |
| Global-e | Europe, North America | Fashion, Retail, D2C eCommerce | global-e.com |
| Verifone (formerly 2Checkout) | Global | B2B, SaaS, Digital Goods | verifone.com |
| PayPro Global | Global | Software, SaaS, Digital Products | payproglobal.com |
| Nexway | Europe | Digital Goods, Software, Subscriptions | nexway.com |
| Cleverbridge | Europe, North America | SaaS, Digital Goods, Subscriptions | cleverbridge.com |
| Fungies.io | Global | Indie Games, SaaS, Digital Goods | fungies.io |
| SubscriptionFlow | Global | Subscription-Based Businesses | subscriptionflow.com |
| ModusLink | Global | Supply Chain, eCommerce, Digital Goods | moduslink.com |
| GappGroup | Global | eCommerce, Digital Goods | gappgroup.com |
| Zonos | USA | U.S. Sales Tax Compliance, eCommerce | zonos.com |
| Startbutton | Africa | Digital Goods, SaaS, eCommerce | startbutton.africa |
| DLocal | Latin America, Africa, Asia | Emerging Markets, Digital Goods | dlocal.com |
Final Thoughts
If you’re a digital-first brand or platform looking to go global without the pain of international tax, compliance, and payments infrastructure, a Merchant of Record may be your smartest growth lever.
It’s not just a payments strategy—it’s a global enablement model that simplifies your operations, speeds up expansion, and protects your brand from legal and financial risk.
Ready to scale without borders? MoR might just be your passport.
Vibhu Arya is a fintechFintech fintech
Short for financial technology, refers to tech-enabled innovation in financial services. and payments expert with 15+ years of experience simplifying how money moves across digital and retail ecosystems. He’s led strategy and partnerships at Citibank, Adyen, and IKEA, and helped scale fintech startups (Snapdeal, iPaylinks) to $1B+ valuations. Vibhu’s expertise spans cards, crypto, cross-border, and real-time payments. He is the founder of PaymentsPedia.com, where he writes about the future of payments.
📧 vibhu@paymentspedia.com | LinkedIn