How to enter the payment industry: legal requirements & tech stack choices

3 entry paths to the payment industry

There’s no single way to launch a payment business. The right approach depends on your goals, resources, and existing network. Let’s explore the three main options.

Option 1: start as an ISO / MSP

As an Independent Sales Organisation (ISO) or Merchant Service Provider (MSP), you act as an intermediary between merchants and acquiring banks. You typically resell and support payment processing services without owning the full technical infrastructure and earn commissions or fees based on the volume of transactions your merchants process.

Since you’re reselling services, there is no need for a license here, just:

• Connections to merchants and across the payment industry
• An understanding of the payment ecosystem
• A desire to help businesses grow through better payment solutions

This model is perfect if you're just starting out or testing the waters before launching something bigger.

Option 2: ISO/MSP with infrastructure

Once you’ve gained experience as an agent or reseller and built a solid network, you might want more control over the payment processing experience while still leveraging partnerships with banks and larger payment networks. That’s where infrastructure comes in.

With advanced payment software at hand, you can elevate your merchants' experience by providing tailored solutions – dynamic dashboards, smart transaction routing, analytics, and fraud prevention tools await to empower their success. This helps you differentiate your business and build a more recognisable presence in the market.

Infrastructure also brings greater transparency and control over your provider relationships. You'll have better visibility into actual processing volumes and performance metrics, helping you make more informed decisions and optimise your traffic distribution.

While this model does require investment in technology, security, and operational readiness, it’s still far more accessible and less resource-intensive than building a fully licensed PSP from the ground up.

Option 3: become a fully licensed PSP

If your goal is full independence, this is your path. A payment service provider with a full license operates as an independent payment processor. This model offers complete control over the payment ecosystem but comes with the most rigorous regulatory and operational requirements.

It’s an exciting path but also a significant undertaking. You’ll need:

• Time and budget. Expect to spend 1–2+ years and $200k+ just to develop the core functionality. Costs can rise quickly depending on your team setup and location. Licensing is a separate expense, varying widely by jurisdiction and license type – ranging from tens to hundreds of thousands of dollars, including legal and consulting fees.
• Licensing. You must acquire the necessary licenses for your target markets. In Europe, that typically means a Payment Institution (PI) license or an Electronic Money Institution (EMI) license under the EU’s PSD2 framework. Other regions have their own licensing regimes with varying complexity and capital requirements.

• A clear business plan. Regulatory bodies expect a detailed business model, including your service offering, target audience, risk management strategy, and growth projections. Your plan should also outline your approach to compliance, fraud prevention, and AML (anti-money laundering) measures.
• An experienced team. Regulators will assess the professional competence of your executive team. You’ll need specialists in compliance, operations, finance, IT security, and legal affairs to meet regulatory demands and maintain operational integrity.
• Technical setup. Beyond the license, you’ll need to build or integrate a reliable and secure technical platform, including core payment processing, client onboarding (KYC/AML), reconciliation, and reporting tools. Many companies partner with a payment orchestration platform to accelerate their go-to-market while staying in control.
• Underwriting & risk ownership. A fully licensed PSP assumes full underwriting responsibilities. This means you're directly approving and managing merchant accounts — and taking on the associated financial, legal, and reputational risks.

Yes, it’s a demanding journey – but with a clear vision and the right resources, becoming a fully licensed PSP can open the door to major opportunities. You gain trust, full control, and the ability to scale on your own terms.

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Build vs Buy: which approach is right for you?

When launching your own payment business or expanding your existing one, one of the first big decisions you’ll face is this:

Let’s break it down.

Building PSP from scratch

Creating a custom payment platform from the ground up can sound appealing, especially if you want full control over every feature and line of code. You can tailor everything to your specific needs and vision.

But let’s be real: it’s a major commitment.

To help you understand what’s involved in the build path, we’ve prepared a detailed checklist outlining all the must-haves you’ll need to consider before committing.

Choosing a white-label solution

Instead of building everything from scratch and handling the complexities on your own, consider a faster and more efficient route. A white-label payment solution can speed up your payment business journey, taking you from just an idea to landing your first client much faster. Plus, it saves you the hassle of figuring everything out on your own.

Let’s recap the basics:

In simple terms, you get access to a complete payment processing ecosystem – already tested, secure, and feature-rich. You can then:

• Customise it to match your brand and business logic
• Integrate your preferred providers and services
• Start onboarding merchants in a matter of weeks

This model significantly reduces time to market, development burden, and initial investment, making it ideal for those who want to enter the payment space quickly and confidently without compromising on functionality or scalability.

To ensure a well-founded comparison, let's contrast two methods of launching a payment business: building from scratch and leveraging a white-label solution.

Whether you're an ISO/MSP looking to empower your infrastructure or a team launching a new PSP project, a white-label solution can provide a significant head start.

How Corefy can help

At Corefy, we’re here to power your vision. Whether you're an ISO/MSP looking to boost your capabilities or planning to launch your own branded PSP, our goal is to make the technical side of payments seamless, scalable, and ready to grow with you.

We understand the frustrations beginner PSPs face with the complexities of payment infrastructure. Our goal is to simplify this complexity, providing the essential building blocks they need to swiftly adapt to evolving business needs.

Denys Kyrychenko

Corefy Co-founder and CEO

Here’s who we’re a great fit for:

• ISOs/MSPs ready to move beyond referrals and offer branded services
• Entrepreneurs with merchant relationships and a clear value proposition
• Licensed PSPs seeking a powerful infrastructure partner

Get access to best-in-class technology, minimise launch time, and reduce upfront costs – while maintaining full control over your brand and client relationships.