> For the complete documentation index, see [llms.txt](https://plexo.gitbook.io/rest-api/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://plexo.gitbook.io/rest-api/core-concepts/payment-facilitators.md).

# Payment Facilitators (PayFacs)

*Brief explanation: A Payment Facilitator (PayFac) is an intermediary that enables sub-merchants to accept payments without having their own direct processor relationships.*

## What is a Payment Facilitator?

A Payment Facilitator (PayFac) is a service provider that:

* Aggregates multiple merchants under its master merchant account
* Manages relationships with payment processors
* Simplifies merchant onboarding
* Handles underwriting and risk management
* Manages settlement and reporting

**Traditional Model vs PayFac Model:**

**Traditional (Gateway Mode):**

```
Merchant → Processor → Card Network → Bank
(Direct relationship, slower onboarding)
```

**PayFac Model:**

```
Sub-Merchant → PayFac → Processor → Card Network → Bank
(Aggregated, faster onboarding)
```

## How PayFacs Work

### Sub-Merchant Aggregation

The PayFac acts as the "merchant of record" to the processor:

1. **Master Merchant Account**: PayFac has one account with processor
2. **Sub-Merchant IDs**: Each merchant gets a unique sub-merchant ID
3. **Transaction Routing**: All transactions flow through PayFac's account
4. **Settlement**: PayFac distributes funds to sub-merchants

### Benefits for Merchants

**Fast Onboarding:**

* No direct processor application
* Minimal documentation required
* Approval in days vs. weeks/months
* Simplified compliance

**Lower Barriers:**

* No processor relationship needed
* No negotiation of processing rates
* Reduced underwriting requirements
* Lower minimum processing volumes

**Simplified Operations:**

* Single integration point
* Unified reporting
* Centralized support
* Reduced administrative burden

### PayFac Responsibilities

**Risk Management:**

* Screen and onboard sub-merchants
* Monitor transaction patterns
* Handle chargebacks
* Manage fraud prevention

**Settlement:**

* Collect funds from processor
* Distribute to sub-merchants
* Handle reserves and holds
* Provide settlement reports

## Handy: Plexo's PayFac Partner

Plexo currently supports [**Handy**](https://handy.uy/) as the payment facilitator for sub-merchant aggregation.

Handy is a Uruguayan payment solutions provider offering comprehensive payment processing services. They provide:

* **Multiple Payment Methods**: Support for 25+ payment methods including credit/debit cards, prepaid cards, PIX, and digital payment networks
* **POS Solutions**: Point-of-sale terminals and mobile payment acceptance
* **Online Payment Gateway**: Payment links, QR codes, and e-commerce integration
* **Fast Settlement**: Handy Flash feature for instant fund transfers
* **Business Management Tools**: Invoicing, automatic billing, and provider payments
* **Regulated Entity**: Supervised by Banco Central del Uruguay (BCU)

**Supported Markets:**

* Uruguay

### Handy Configuration

Sub-merchants configured through Handy require:

```json
{
  "paymentFacilitator": {
    "id": "1", // Handy's PayFac ID in Plexo
    "merchantId": {{MERCHANT_ID}} // Handy-assigned sub-merchant ID for this merchant
  }
}
```

## When to Use PayFac Mode

**Ideal for:**

* Startups and new businesses
* Low to medium transaction volumes
* Quick go-to-market needs
* Limited technical resources
* No existing processor relationships

**Not ideal for:**

* High-volume merchants
* Businesses needing custom rates
* Merchants with processor relationships
* Special compliance requirements
* Direct settlement needs

## Sub-Merchant Compliance

Even in PayFac mode, sub-merchants must comply with:

**KYC Requirements:**

* Business registration documents
* Tax identification (RUT, CNPJ, etc.)
* Ownership verification
* Business type declaration

**Acceptable Use:**

* Prohibited industries restrictions
* Terms of service compliance
* Chargeback thresholds
* Fraud monitoring

## Related Resources

* [Gateway vs PayFac Modes](/rest-api/core-concepts/gateway-vs-payfac.md)
* [Payment Methods Setup](/rest-api/merchant-configuration/payment-methods-setup.md)
* [Merchants](/rest-api/core-concepts/merchants.md)
* [Supported Payment Methods and Processors](/rest-api/reference/supported-payment-methods.md)