Payment Processor

by Hannah Grace Holladay / May 16th, 2023

A third-party payment processor is a depository customer of a bank that uses their banking relationship to process payments on behalf of other companies through its bank. They are typically referred to as processors that process ACH and/or remotely created checks (RCC), although it is typically much broader than that because banks do not have a contractual relationship with the TPPP’s merchant clients, so you can have credit cards, checks that are not remotely created, and return products that fall under this umbrella term. It is also important to note that TPPP is also synonymous with TSP, or third-party senders, by NACHA if they are processing ACH payments and must adhere to the third-party vendor requirements under the rules.