Every day, billions of dollars exchange hands on marketplaces. These online marketplaces are modern wonders, connecting buyers with sellers worldwide. Under the hood, they're all powered by marketplace payment solutions. They take in payments from buyers to marketplace operators. Then, they send global marketplace payouts from operators to sellers. Understanding payment processing for marketplaces and your options is important for anyone trying to start a marketplace. 

That said, the intricate web of transactions in a multi-vendor marketplace demands a thorough understanding of marketplace payments, navigating payment trends, and the sophisticated payment orchestration of multiple touchpoints. This includes marketplace checkouts and vendor payouts.

When done well, streamlining the movement of funds between buyers, sellers, and the marketplace operator ensures efficiency, transparency, and security in transactions. And most of all, it creates trust.

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How do marketplaces handle payments?

Marketplaces handle payments through a series of steps. 

1. Buyer makes a payment: First, the buyer selects products and proceeds to checkout. Note: What's unique about marketplaces is that someone can buy products from multiple sellers in one checkout. Here, they choose a payment method, such as a credit card or digital wallet. The marketplace payment solution processes this payment securely. It uses encryption to protect sensitive information.
2. Operator pays out seller: Once the payment is approved, the marketplace splits the payment. Sometimes payments are held in escrow until the transaction is finalized or goods are shipped. Split payments for marketplaces need to send the right portion to each seller. Typically, the marketplace keeps a commission. This process is called payment disbursement or payouts. It's the process that makes sure sellers receive their earnings promptly.
3. Managing refunds or disputes: Marketplaces also manage refunds and disputes. Each marketplace sets its own refund terms and conditions. But typically, if a buyer is unhappy, they can request a refund. The marketplace reviews the request and processes it if it’s valid. 

What is a marketplace payment gateway?

A marketplace payment gateway is a tool that processes payments between buyers and sellers. It acts as a bridge, connecting the marketplace to banks and payment networks. When a customer makes a purchase, the gateway securely transfers payment information. It checks if the buyer has enough funds and approves the transaction.

The gateway also encrypts sensitive data to protect it from fraud. It supports multiple payment methods, like credit cards and digital wallets. This flexibility helps marketplaces cater to different customer preferences. Additionally, the gateway handles refunds and chargebacks, ensuring smooth transactions.

Marketplaces often choose gateways that offer easy integration with their platforms. This makes the setup simple and efficient.

Payment gateway vs payment processor

A payment gateway and a payment processor are both key in online transactions. They work together but have different roles.

A payment gateway is like a digital cashier. It collects payment information from the buyer. It then sends this data securely to the payment processor. The gateway ensures the transaction is safe by encrypting the data.

A payment processor acts like a middleman. It communicates between the buyer's bank and the seller's bank. The processor checks if the buyer has enough funds. If approved, it moves the money from the buyer to the seller.

While the gateway handles the front-end, the processor manages the back-end. Both are essential for smooth and secure transactions in a marketplace.

An app like Stripe functions as both a payment gateway and a payment processor. 

Ty‎pes of marketplace payments

Giving customers different marketplace payment options is important for any marketplace. It makes checking out easier and improves the shopping experience. When buyers have options, they are more likely to finish their purchase. In fact, 70% of consumers consider the availability of their preferred payment to be influential when choosing where to shop online. 

Credit cards 

Credit card payments are the staple of ecommerce, widely embraced for their convenience and global acceptance. It’s crucial for online marketplaces to collaborate with payment service providers (PSPs) or payment gateways to process credit and debit card payments. This guarantees a straightforward checkout experience for the majority of customers.

Digital wallets

Digital wallets, like Apple Pay, Google Pay, and PayPal, offer customers a lot of convenience. They allow money transfers without the need for a physical card. Digital wallets can also use near-field communication (such as tapping a phone) to make marketplace payments. Online marketplaces can integrate this type of process into their checkout system by redirecting customers to the respective digital wallet apps or websites, where authentication – including biometric ID or PIN entry – ensures a secure transaction.

Wire transfers

Wire transfers serve as a reliable option for both domestic and international transactions, enabling direct fund transfers from one bank account to another. Although not as instant or cheap as digital methods, wire transfers remain integral for critical, time-sensitive, or large-value payments — especially for B2B transactions— providing a robust and widely accepted alternative.

Buy now, pay later (BNPL)

Buy Now, Pay Later (BNPL) is a popular payment option. It lets customers buy items and pay for them over time. This method is great for those who want to spread out their payments. BNPL services often have no interest if paid on time. Marketplaces partner with BNPL payment solutions to offer this choice. It helps attract more buyers and can boost sales.

Account-to-account (A2A) payments

Account-to-Account (A2A) payments let money move directly between bank accounts. This method skips credit cards and other middlemen. It is fast and often has lower fees. A2A payments are secure because they use bank-level protection. Marketplaces use this option to offer a simple and cost-effective way to pay. It is a good choice for both buyers and sellers.

Cryptocurrency payments

Cryptocurrency payments use digital currencies like Bitcoin and Ethereum. These payments are secure because of blockchain technology. Some buyers prefer this method for privacy reasons. Marketplaces can attract tech-savvy users by accepting cryptocurrencies. This option can also appeal to those interested in decentralized finance.

Mobile payments

Mobile payments include methods like SMS payments and carrier billing. These are useful in areas with high mobile use but low banking access. Mobile payments let users pay through their phone bill or prepaid balance. This method is quick and easy for those without credit cards or bank accounts.

Gift cards

Gift cards provide a flexible payment option for customers. They can be used to purchase items within a specific marketplace. Often given as gifts or rewards, gift cards encourage repeat purchases. Marketplaces can use third-party solutions to set up their own gift card systems. This approach helps boost customer loyalty and sales.

Local payment methods

Online marketplaces should strategically integrate local payment methods to meet the diverse preferences of global customers. These methods encompass a wide spectrum of options tailored to specific countries or regions, including bank transfers, direct debit, cash on delivery (COD), and prepaid cards. The integration process for these methods varies based on the payment type and your marketplace’s existing infrastructure, but catering to local demands is a great way to keep customers happy and returning to your platform.

Fortunately, there are many tools to help provide payment optionality to customers, including Stripe, Ayden, Braintree, and more.

Best marketplace payment solutions

Fortunately, there are many reputable tools to help provide payment options to customers. Here are the 14 best marketplace payment solutions for 2025. These marketplace payment companies offer tools to manage transactions effectively and safely.

Stripe

Stripe is a top choice for online payments. It supports many payment methods and currencies. This makes it great for businesses that sell worldwide. Stripe offers strong security to protect against fraud. Its tools are easy to use, helping businesses manage payments smoothly.

Key features:

• Supports multiple currencies
• Advanced fraud protection
• Easy-to-use dashboard
• Subscription billing

Nautical integration: Nautical supports Stripe with a direct integration.

PayPal

PayPal is a well-known payment platform. It's easy to use and offers strong buyer protection. PayPal is accepted worldwide, making it a popular choice. Its mobile-friendly design allows users to pay from anywhere. This makes it a convenient option for many.

Key features:

• Buyer protection
• Easy setup
• Global acceptance
• Mobile-friendly

Nautical integration: Nautical integrates natively with PayPal.

Braintree

Braintree is a flexible payment platform. It’s part of PayPal and works with Venmo, giving customers more options. Braintree is easy to set up and use. It handles both one-time and recurring payments. Its global reach and security make it a reliable choice.

Key features:

• Supports PayPal and Venmo
• Recurring billing
• Advanced security features
• Global reach

Nautical integration: Nautical supports Braintree through the native Zapier integration.

Authorize.Net

Authorize.Net is wholly owned subsidiary of Visa. It's simple to use and offers strong security. This gateway is great for small to medium businesses. It provides tools for fraud detection and recurring billing. Authorize.Net helps businesses manage customer data safely.

Key features:

• Simple checkout options
• Fraud detection tools
• Recurring billing
• Customer information manager

Nautical integration: Nautical supports Authorize.Net via APIs.

Razorpay

Razorpay is a leading payment solution in India. It supports many local payment methods. This makes it ideal for businesses in the Indian market. Razorpay offers quick setup and smart analytics. It helps businesses manage payments easily and effectively.

Key features:

• Supports local payment methods
• Instant activation
• Smart analytics
• Subscription plans

Nautical integration: Nautical supports Razorpay through its Zapier integration.

Square

Square offers payment solutions for businesses of all sizes. Known for its point-of-sale systems, Square supports both online and in-person payments. It also provides tools for managing inventory and customers. This makes it a strong choice for retail businesses.

Key features:

• In-person and online payments
• Inventory management
• Customer engagement tools
• Detailed reporting

Nautical integration: Nautical can integrate with Square via Zapier or APIs.

Dwolla

Dwolla is a payment platform focused on bank transfers in the United States. It offers a simple way to move money between accounts. Dwolla is known for its fast and secure transactions. It’s ideal for businesses that rely on ACH transfers, looking to automate and scale that process.

Key features:

• Bank transfer focus
• Fast transactions
• Secure platform
• Scalable for large volumes

Nautical integration: Nautical can integrate with Dwolla via API.

Exactly

Exactly is a payment solution that offers flexible options for businesses. It supports various payment methods and currencies. Exactly is designed to provide a seamless payment experience, and is suitable for businesses looking for a versatile payment platform.

Key features:

• Supports multiple payment methods
• Currency flexibility
• Seamless payment experience
• Versatile platform

Nautical integration: Nautical can integrate with Exactly via API.

Mangopay

Mangopay offers payment processing, with a focus on marketplaces. It supports a wide range of payment methods and currencies and offers flexible tools for managing complex payment flows. It is perfect for businesses that need a customizable payment system.

Key features:

• Marketplace focus
• Supports multiple currencies
• Customizable payment flows
• Wide range of payment methods

Nautical integration: Nautical can integrate with Mangopay via API.

Coinbase Commerce

Coinbase Commerce allows businesses to accept cryptocurrency payments. It supports popular digital currencies like Bitcoin and Ethereum. It's ideal for businesses looking to tap into the cryptocurrency market.

Key features:

• Accepts cryptocurrency payments
• Supports Bitcoin and Ethereum
• Secure transactions

Nautical integration: Nautical can integrate with Coinbase Commerce via API.

Apple Pay

If you're an apple user, you've heard of or likely use Apple Pay. It's a mobile payment solution that offers a quick and convenient way for Apple device users to pay online and in stores. Apple Pay uses biometric authentication for added security. It's a great option for businesses targeting Apple users.

Key features:

• Mobile payment solution
• Biometric authentication
• Quick and secure
• Wide acceptance

Nautical integration: Nautical can integrate with Apple Pay via API.

Google Pay

Similar to Apply Pay, Google Pay makes it easy for users to pay online and in-store directly from their phone. But unlike Apple Pay, Google Pay is specifically for Android users. Google Pay offers strong security features and a user-friendly interface. It's a great option for businesses catering to Android users.

Key features:

• Digital wallet platform
• Strong security features
• User-friendly interface
• Wide acceptance

Nautical integration: Nautical can integrate with Google Pay via API.

Adyen

Adyen is a global payment platform that has an offering specifically for marketplaces — Adyen for Platforms. It offers tools to support the marketplace payments from start to finish, including signing up, selling, and getting paid. They're used by well-established marketplaces like Uber and eBay.

Key features:

• Supports marketplace payments
• Advanced fraud management
• Scalable and reliable
• Supports many payment methods

Nautical integration: Nautical can integrate with Adyen via API.

Helcim

Helcim is a payment solution known for its transparency and low fees. It supports both online and in-person payments. Helcim offers tools for managing transactions and customer data. It's ideal for small businesses seeking a cost-effective payment option.

Key features:

• Transparent pricing
• Low fees
• Online and in-person payments
• Transaction management tools

Nautical integration: Nautical can integrate with Helcim via API.

Marketplace payment APIs

Payment APIs are powerful tools that empower marketplace operators to connect to various marketplace payment options. They enable seamless transactions, allowing you to integrate with different payment providers. This integration ensures that your marketplace processes payments securely and efficiently.

With Nautical Commerce, you can create a multi-vendor marketplace tailored to your needs. The platform simplifies payment orchestration, giving you the flexibility to choose from a wide range of payment gateways like Stripe and PayPal. This means you can offer your customers diverse payment options, enhancing their shopping experience.

At checkout, Nautical Commerce helps you calculate the total amount, including product price, shipping, taxes, and discounts. This ensures transparency and accuracy in every transaction. You can then process payments using your chosen gateway, supporting methods like credit cards and digital wallets. This variety caters to your customers' preferences, making it easier for them to complete their purchases.

For those who prefer more control, Nautical offers a Manual Payments plugin to manage off-platform digital transactions. This feature lets you track payment status and manage orders manually, giving you peace of mind. Additionally, Nautical supports pre-authorizing payments, ensuring funds are only transferred when orders are fulfilled. This adds an extra layer of security and reliability to your operations.

With Nautical's APIs, onboarding a variety of payment solutions is possible. This integration enhances your marketplace's payment process, ensuring a smooth and secure experience for both you and your customers.

How to choose a marketplace payment solution

Choosing the right payment solution is vital for your marketplace. It affects customer satisfaction, trust, and, ultimately, business success. Here are key factors to consider:

Understand your needs

This may seem like table stakes, but all payment solutions come with different strengths and weaknesses. Identify what your marketplace requires. Some things to consider are: 

• Types of products you sell
• Your target audience
• Whether you'll sell internationally
• Preferred payment methods

Evaluate security features

The easiest way to break marketplace trust? Payment fraud. Ensure the payment solution offers strong security measures. Look for encryption, fraud detection, and compliance with industry standards. Security is crucial to protect your customers and your business.

Check integration options

Choose a solution that integrates easily with your existing systems. Seamless integration and onboarding reduce setup time so it's worthwhile to verify compatibility with your platform and other tools.

Consider transaction fees

Not only do you need to consider the subscription price of your payment solution, but also take into account transaction fees. Review the fees associated with each payment solution. Compare transaction costs, monthly fees, and any hidden charges. Choose a solution that offers good value without compromising on features.

Assess customer support

Reliable customer support is essential. Ensure the payment provider offers timely assistance and resources. Good support helps resolve issues quickly and keeps your marketplace running smoothly.

Look for scalability

Select payment solutions for marketplaces that can grow with your business. It should handle increased transaction volumes and support new features as needed. Scalability ensures long-term success, without needing to find a new provider.

Test the user experience

Evaluate the user experience for both buyers and sellers. The payment process should be easy and intuitive. It goes without saying, a positive experience encourages repeat business and customer loyalty.

Ma‎rketplace vendor payouts

In a multi-vendor marketplace, it’s not enough to be able to receive payments in multiple formats – paying out your vendors with the same degree of flexibility is an essential marketplace feature. 

To create an effective payout process you need to answer three main questions: When, where, and how.

When to pay out vendors

Finding the right payment schedule can be a challenge, and plays a critical role in protecting yourself as a marketplace operator.

For example, if you’re selling physical goods, and you pay out your vendor upon receiving the order, you’re assuming that no issues will arise with fulfillment or delivery. This might be an okay assumption to make in some cases. But in others, you may be putting yourself at risk. 

There are several options for when to pay your vendors, and they’ll likely depend on the types of goods you’re selling and your relationship with your vendors. Here are some examples of routes you can take:

• Scheduled payouts that follow predefined intervals, with options like daily, weekly, or monthly transfers. This model gives operators a more predictable cash flow, and is more manageable for big vendors. 
• Realtime payouts that trigger upon specific events, like fulfilling an order or delivery. This instant access to funds can help attract new vendors to your platform and is optimal for small transactions.

Where to pay out vendors

Where do your vendors want to receive their money? The answer will vary depending on the seller and it’s important to keep this in mind. Some will prefer the money ends up directly in their bank account, while others will be accustomed to leveraging platforms like PayPal or Stripe Connect to receive their funds. 

This is a key decision to set up your marketplace for success. 

How to pay out vendors 

As you can see, marketplace payments can get complicated quickly. Having the right technology in place helps you avoid stacking headcounts as your marketplace grows. Payment orchestration tools make these processes much more manageable while ensuring compliance and provide scalability for growing marketplaces.

Payment service providers (PSPs) are key to this process. They handle transactions between buyers, operators, and banks. PSPs provide the infrastructure, security, and compliance needed for smooth operations. For example, Stripe Connect supports various payment methods and automates vendor payments. It also manages compliance tasks like KYC and OFAC.

Nautical simplifies vendor payouts with our integrated system. It processes payouts in batches, including all revenue accrued until a specified date. You can choose from payout gateways like Stripe Connect, PayPal, and Trolley. Each gateway requires an active integration and seller onboarding.

To process a payout, you head over to the payout section of the Nautical dashboard. There, the payouts owed will appear automatically. You can adjust payout balances and add notes for clarity. Once finalized, payouts are locked and processed through the chosen gateway. Nautical updates the payout status and notifies sellers via email.

You can view all payouts for a seller in their profile. Nautical provides detailed payout statements, showing sales, shipping, discounts, and more. This transparency helps you manage finances effectively and keeps your vendors informed.

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How to secure payments on marketplaces

Marketplaces operate as the merchants of record, handling transactions on behalf of sellers. When fraud occurs, customers – or their bank or credit card company – often contact the marketplace, not the seller, putting the onus on the operator to resolve the issue. 

Robust know-your-vendor checks are therefore crucial to mitigating the risk of fraud. This involves verifying the identity of sellers, affiliates, influencers, and other entities joining the platform. It not only protects the marketplace but also builds trust with customers and ensures compliance with regulations.

Use encryption

Encrypt all payment data. This makes it unreadable to unauthorized users. Encryption keeps sensitive information safe during transactions.

Implement SSL certificates

Secure Sockets Layer (SSL) certificates protect data transferred between the user's browser and your server. They ensure that all data is encrypted and secure.

Choose reliable payment gateways

Use trusted payment gateways for marketplaces. These gateways have strong security measures in place to protect transactions.

Enable two-factor authentication (2FA)

Require 2FA for user accounts. This adds an extra layer of security by requiring a second form of verification, like a text message code.

Monitor transactions

Regularly review transactions for unusual activity. Set up alerts for large or suspicious transactions to catch potential fraud early.

Conduct regular security audits

Perform security audits to identify vulnerabilities. Fix any issues promptly to maintain a secure environment.

Know your vendor checks

Conduct know-your-vendor (KYV) checks to verify the identity of your vendors. This process helps prevent fraud by ensuring that vendors are legitimate and trustworthy.

Ot‎her important considerations for marketplace payments

International marketplace payment processing

If you’re operating in more than one country, you’ll need to consider how to handle multi-currency marketplace payments. Offering sales in regional currencies while maintaining a consistent payment experience for all of your customers is vital for global marketplaces. Here are key aspects to consider:

Support multiple currencies

Ensure your payment solution supports various currencies. This allows customers to pay in their local currency, improving their shopping experience. It also reduces conversion fees and simplifies transactions.

Comply with local regulations

Understand and comply with the regulations in each country you operate. This includes tax laws, data protection, and financial regulations. Compliance helps avoid legal issues and builds trust with customers.

Choose global payment gateways

Select payment gateways that operate worldwide. These gateways should offer reliable service and support multiple payment methods. This ensures smooth transactions for international customers.

Manage currency conversion

Implement a system to handle currency conversion. This can be done through your payment gateway or a separate service. Accurate conversion rates are important to maintain fair pricing.

It's worth noting that in a marketplace, you need to worry about three currencies: the marketplace domicile currency (operator), the source currency (seller), and the transaction level currency (buyer).

Tax complexity

Taxes get complicated in global online marketplaces — which poses a risk for operators. To run legally and efficiently, operators need to have all of the essential details nailed down, such as knowing who’s responsible for paying taxes and to whom.

For example, in the US, marketplaces that reach a certain threshold of sales revenue and/or transaction volume are required to collect sales tax on behalf of their vendors, which means tax remittance is the marketplace’s responsibility. 

In Europe, marketplaces are also responsible for collecting sales tax (VAT) if they meet certain conditions, like if the underlying vendor is a small business exempt from collecting tax themselves.

Tax tools like Avalara help ensure you’re complying with tax laws without needing to stack labor against tax remittance. Nautical Commerce integrates directly with Avalara to make this easier.

Compliance and due diligence

Marketplaces are unfortunate targets for fraudsters, money launderers, and a slew of other unsavory characters. Not doing your due diligence on how money moves through your marketplace, including having mechanisms in place for anti-money laundering (AML) and anti-fraud, can quickly get you in hot water with regulators. It’s crucial for operators to stay compliant with financial regulations and continuously monitor payment processes on their platform.

Split payments

On multi-vendor platforms, it’s very common for buyers to check out items from more than one seller. Split payments are a means of efficiently distributing a single payment among the multiple parties involved in a transaction, such as sellers or service providers.

Essentially, whenever a buyer makes a purchase, the marketplace calculates the distribution of funds, executes the payment after deducting fees or commissions, and then distributes the funds. Nautical handles this automatically for marketplaces that use our platform.

Marketplace payment strategies are always evolving

Intelligent payment orchestration is a cornerstone of every successful multi-vendor marketplace. It requires adapting to evolving payment preferences, ensuring transparent vendor payments, and safeguarding against fraud. With the right approach to marketplace payments, operators can provide smooth experiences to customers and pave the way for sustained growth.

Check out Nautical’s payment integrations to ensure smooth payment orchestration on your marketplace. 

More resources:

• What is a merchant of record? 
• What are the latest trends in B2B marketplace payments? 
• Building trust on your multi-vendor marketplace

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