A merchant of record (MOR) is a term used in the field of e-commerce and refers to an organisation or company that is responsible for the sale of goods or services. The merchant of record is legally and financially responsible for finalising sales transactions with customers. This typically includes the processing of payments, compliance with tax regulations and the fulfilment of legal obligations in connection with the sale.

In many cases, the merchant of record acts as an intermediary between the customer and the actual provider of the goods or services. This is particularly common in international transactions or sales via online platforms. The merchant of record often also assumes responsibility for customer support, returns processing and dispute resolution in connection with sales.

The role of the merchant of record is particularly important for companies that operate globally or sell digital products and services, as they need to ensure that their sales activities comply with applicable laws and regulations in different coun

The Merchant of Record (MoR) is the authoritative party or company that acts on behalf of all transactions and handles the entire processing of payments. This important role of the MoR extends in particular to the B2C business, where direct interaction with end customers takes place. The MoR assumes responsibility and liability for all aspects of this business relationship, from order to payment.

In addition to the B2C business, there is often a B2B relationship between the seller shop and the MoR. In this scenario, the MoR acts as the seller’s customer while simultaneously assuming the role of the main player in the B2C business. This constellation implies that the MoR is also responsible for VAT in all transactions, as it represents the final interface to the end customer.

Advantages of a “Merchant of Record”:

The MoR assumes responsibility for ensuring that all legal and tax requirements are met in the context of the sale of goods or services to end customers (B2C) in different regions or countries. This task is often complex due to the different laws and tax rates in different countries.

One example of this is the correct payment of VAT in the EU in accordance with the recipient principle, which means that VAT is paid in the country of the recipient of the service and not in the country of the supplier.

The MoR ensures the secure and efficient processing of payments. This includes the processing of various payment methods such as credit cards, instant payments, SEPA transfers, instant transfers, iDEAL, GiroPay, EPS, Cash2Code, Call2Pay, HandyPay and cryptocurrencies such as Bitcoin.

For international sales, MoR is able and authorised to perform currency conversions to allow customers to pay for your products and services in their own currency.

The MoR offers risk management services to prevent fraud and reduce the risk of payment defaults. Ideally, the MoR assumes the cancellation liability, which means that the risk of payment defaults is reduced to zero for you.

The MoR offers customer service for questions and disputes in connection with payments. It also handles the processing of credit notes and refunds to end customers.

Using an MoR allows companies to focus on their core activities, while the MoR takes care of the challenging areas of payment processing and compliance (adherence to financial regulations).

The implementation of an MoR offers companies that want to expand their business activities into different countries a simplified process. The MoR understands the local requirements and regulations and is able to understand them internally and implement them externally. This not only improves efficiency but also minimises the risk of compliance breaches as the MoR has the necessary expertise to ensure that all required legal and financial regulations are met.

By utilising an MoR, companies can therefore ensure that their expansion runs smoothly and they can focus on their core competencies while the MoR takes care of local compliance.

By hiring a professional MoR, the payout processing for content creators, performers and amateurs, including the KYC processes, is also carried out. All this is done in a perfectly automated process. This allows you to concentrate 101% on marketing your content and continuously increasing your traffic without being slowed down by administrative work.

We would like to introduce you to six crucial billing factors that you should consider when considering a suitable merchant of record for marketing your content. Choosing the right MoR is crucial to the success of your sales strategy, especially in an international context. The following criteria will be of great benefit to you. The billing system of a MoR should provide at least the following:

Features of MoR billing

Especially when expanding your e-commerce project internationally, it is crucial to offer a wide range of common payment options.

Explore the most commonly used national and international payment methods and make sure that your future marketing partner supports them. It is equally important to consider alternative payment methods that may not be standard.

Depending on your geographical area of operation, it may also be beneficial to offer the option to pay in different currencies. Think about this in perspective and keep this in mind.

In e-commerce, the term “conversion” typically refers to the action in which a visitor to your e-commerce website performs a desired action. This action can be varied and often includes completing a purchase or achieving another important goal, such as filling out a contact form, subscribing to a newsletter or adding a product to the shopping basket.

The conversion rate is an important key figure in e-commerce and indicates how many visitors to your website actually carry out the desired action in relation to the total number of visitors. A high conversion rate is often a goal in e-commerce as it shows the effectiveness of your website in converting visitors into paying customers or leads. To increase the conversion rate, various optimisation strategies can be applied, such as improving the user experience, providing clear instructions or optimising the check-out process.

It is inefficient to choose a MoR whose payment process has low conversions. It is advisable to test this in advance. For example: Imagine you want to buy a digital product and have to enter extensive address data. It would make more sense to only have to enter an email address.

It is of the utmost importance to carefully check the security features and ensure that they are available as standard.

Online payments are subject to strict regulations, so it is crucial that your chosen payment provider is compliant in this regard. An example of this is global compliance with PCI-DSS guidelines for accepting credit card payments, which is essential and can greatly assist your own efforts.

Regional or local regulations may also apply, such as different security standards for credit card payments in the European Union. These security aspects should not be overlooked.

In addition, a MoR should have integrated protection systems such as address verification and credit checks in the SEPA procedure (direct debit). Dynamic 3D secure procedures for credit card payments and similar procedures are also of great importance.

An important aspect is the simple and user-friendly integration with the help of an API or SDK interface or a plugin that is compatible with common shop systems. This facilitates seamless integration into your e-commerce project.

It is also an advantage to have a technical contact available to support you during the integration phase. This ensures complete flexibility and control over the integration process.

If you opt for a subscription model, it is advisable to choose a MoR that supports automatic recurring billing via credit cards with an automation function.

This feature allows your customers to automatically renew their subscription without having to take manual steps, resulting in an improved customer experience (see point 2 – Conversion). This allows you to focus more on your business and boost customer loyalty, which in turn can lead to significant increases in revenue.

If your customers need invoices, these are automatically generated and provided by the MoR system to ensure that your customers are always informed about the status of their subscription.

Cost efficiency in marketing your content is crucial and should be considered when choosing the appropriate MoR.

It is advisable to carefully review the actual payment fees and ensure whether they include any additional transaction or cancellation fees. It is important to investigate whether the MoR charges different fees for different payment methods or whether it applies a standardised fee structure (discount).

You should also clarify whether the costs for security systems are charged separately or are already included in the fees, and similar details.

If you are considering automatic invoicing, it is also important to check whether additional fees apply or whether this feature is available to customers free of charge.


Resume “Merchant of Record”

Overall, a Merchant of Record offers a comprehensive solution for the professional and smooth processing of online transactions and relieves companies of the administrative and legal challenges associated with e-commerce.

However, it is crucial to note that the choice of the right MoR should be made carefully, as this will have a significant impact on the success of the e-commerce business.

It cannot be emphasised enough: Without a suitable MoR marketing your content, business will struggle to succeed in 2024.

Netfield Media S.L. – “Merchant of Record” from the very beginning

We, Netfield Media S.L., have been on the market since 2012 and fulfil all the necessary standards for the marketing success of your digital goods.

The integration of our interfaces requires minimal effort. Experience has shown that we achieve a high conversion rate as the data input for the end customer is minimal. For example, only an e-mail address is required as the buyer’s contact details.

An outstanding feature is that only the end customer’s IBAN is required for direct debits, without any further address data. This results in a simple and efficient payment process in a single step, which leads to high customer acceptance and a low cancellation rate. 98.5 % of our partners are paid without chargebacks!

Both private users and business customers can offer digital content via our platform, with just one interface. The payout cycles are short, with no minimum turnover and no minimum payout limit. Payments are made without chargebacks, no chargebacks (cancellation-free) and are fully automated in agreed cycles. Financing is transparent and based on a previously agreed, turnover-dependent discount. If turnover increases or decreases, the discount is renegotiated on a quarterly basis. You receive one (or more) complete monthly statement(s), including for webmasters and models, automatically from the accounting system for your tax records. This eliminates the need for time-consuming KYCs (for webmasters & models, studios), as well as individual bookings, tax allocations, etc. The KYC is handled entirely by Netfield Media S.L. in accordance with the relevant AML regulations. This allows you to concentrate exclusively on your core business, which will certainly lead to more sales volume.