About BPSP

Card networks offer third-party bill payment provider programs called Business Payment Service Provider (BPSP) or Bill Payment Provider (BPP) programs. BPSP/BPPs are often bill payment aggregators for commercial / B2B bill payments.

A Business Payment Service Provider (BPSP) or Bill Payment Provider (BPP) is, therefore, a service provider who facilitates commercial business-to-business payments between buyers and suppliers.

Use Case

• B2B Payments: Facilitate payment acceptance for vendors and suppliers from other businesses.

How BPSPs Operate

The BPSP construct allows buyers to pay their bills with a network-approved commercial card even if the supplier is not a card accepting merchant, thereby providing more payment options for buyers. The buyer pays the BPSP with say, a Mastercard/Visa commercial card, and instructs the BPSP to pay the supplier on its behalf. The BPSP pays the supplier using a non-card method of payment.

The BPSP Model:

• Focuses on commercial or business-to-business payments, usually for invoices based on pre-negotiated terms.
• Disallows BPSPs to enable transactions for billers who do accept Visa for network-approved cards through other channels.
• Establishes contracts between BPSP and TabaPay, not the underlying sellers.
• Requires the BPSP to manage the end-to-end customer experience, processing the customer’s purchase and issuing a transaction receipt under the name of the BPSP.
• Also requires BPSPs to process customer service inquiries, refunds and disputes, though these are usually low on the basis that most payments are post-paid bills for products/services that have already been consumed or delivered.

Cost-Effective Bill Payments

If you as a business accept corporate/commercial cards, you can reduce the overall cost of payment acceptance by providing more data through TabaPay to the networks. This data, when sent to card networks such as Visa and MasterCard enables businesses to secure a much lower interchange rate.

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Interested in Level 2/Level 3 processing?

If you are a business with higher volumes of B2B or B2G payment volume, TabaPay can help you bring down the costs of payment processing with L2 and L3 data shared with the networks.

Read more here.

How BPSPs Work

Step 1: Suppliers usually invoices for a payment in 60 days once they receive the purchase order from the buyer.

Step 2: Buyers through a BPSP can pay using their Commercial credit card improving their cash flow up.

Step 3: The BPSP integrates with TabaPay's Create Transaction API to pull funds from the Buyer's commercial card.

Alternatively, buyers can also initiate payments before the due date, allowing suppliers to receive payment earlier and return for an early payment discount.

Step 4: BPSP can send funds to the Supplier's bank accounts using TabaPay's ACH or RTP solutions.

Step 5: Once BPSP sends funds to the Supplier's bank accounts, it sends a remittance advice to the supplier and updates that payment has been made.

Visa BPSP Requirements

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Overview: Effective 13 April 2024

Visa will introduce new eligibility and compliance rules to the Business Payment Solution Provider payment model.

• In addition to TabaPay registering the BPSP with Visa, BPSPs will be required to sign a commercial agreement with Visa directly.
• Certifies to Visa that the supplier being paid through the BPSP, conditionally accepts or does not accept Card payment for the good or service being purchased and paid by the buyer and therefore pursues payment via the BPSP
• Payments to overseas suppliers will be permissible, such that a buyer may pay a supplier in a different country through a BPSP.
• Only performs BPSP services as a Card-Absent Environment Merchant
• Initiates a transaction only after the buyer has confirmed that the non-Visa-accepting supplier has shipped goods or delivered services and the buyer has approved the payment
• Initiates a transaction only after the buyer has confirmed that the supplier has shipped goods or delivered services and/or the buyer has approved the payment
• Performs customer verification (KYC) and meets all applicable anti-money laundering requirements for all non-Visa-accepting suppliers before initiating Transactions for such suppliers’ invoices
• Performs customer verification (KYC) and meets all applicable anti-money laundering requirements for all the suppliers before initiating Transactions for such suppliers’ invoices
• Uses a secure payment process that ensures funds are paid into individual supplier accounts
• Ensures that each invoice from a non-Visa-accepting supplier to a buyer is processed as a separate transaction
• Never aggregates payments from multiple buyers into one payment per supplier
• Contractually obligates the buyer, by way of written agreement between the buyer and the BPSP, to accept all risks associated with nonperformance of the non-Visa-accepting supplier
• Contractually obligates the buyer, by way of written agreement between the buyer and the BPSP, to accept all risks associated with non-performance of the supplier
• (Through 17 April 2027) Accepts payments from businesses for business expenses utilizing the Visa Commercial Card or Visa Consumer Card of their choice.

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Consumer Card Acceptance - Until April 2027

Buyers will be able to utilize their preferred Visa card (consumer or commercial) for payments as long as the applicable transaction is initiated by a business and is for a business purchase. It is important to note that consumer cards will only be accepted until April 2027.

• Accepts payments from businesses for business expenses utilizing the Visa Commercial Card of their choice
• Ensures that the following MCCs are not eligible to be included in BPSP-supplier flows:
  • All designated unique airline and air carrier, car rental agency, and lodging MCCs, as
    specified in the Visa Merchant Data Standards Manual
  • 4112 (Passenger Railways)
  • 4411 (Steamship and Cruise Lines)
  • 4722 (Travel Agencies and Tour Operators)
  • 4723 (Package Tour Operators – Germany Only)
  • 4814 (Telecommunication Services, including Local and Long-Distance Calls, Credit
    Card Calls, Calls Through Use of Magnetic-Stripe-Reading Telephones, and Fax
    Services)
  • 4829 (Money Transfer)
  • 4899 (Cable, Satellite, and Other Pay Television/Radio/Streaming Services)
  • 5962 (Direct Marketing – Travel-Related Arrangement Services)
  • 5966 (Direct Marketing – Outbound Telemarketing Merchant)
  • 5967 (Direct Marketing – Inbound Teleservices Merchant
  • 6010 (Financial Institutions – Manual Cash Disbursements)
  • 6012 (Financial Institutions – Merchandise, Services, and Debt Repayment)
  • 6051 (Non-Financial Institutions – Foreign Currency, Liquid and Cryptocurrency Assets
    [for example: Cryptocurrency], Money Orders [Not Money Transfer], Account Funding
    [not Stored Value Load], Travelers Cheques, and Debt Repayment)
  • 6211 (Security Brokers/Dealers)
  • 7011 (Lodging – Hotels, Motels, Resorts, Central Reservation Services [Not Elsewhere
    Classified])
  • 7012 (Timeshares)
  • 7512 (Automobile Rental Agency)
  • 8011 (Doctors and Physicians [Not Elsewhere Classified])
  • 8050 (Nursing, Home Healthcare and Personal Care Facilities)
  • 8062 (Hospitals)
  • 8099 (Medical Services and Health Practitioners [Not Elsewhere Classified])
  • 8211 (Elementary and Secondary Schools)
  • 8220 (Colleges, Universities, Professional Schools, and Junior Colleges)
  • 8241 (Correspondence Schools)
  • 8244 (Business and Secretarial Schools)
  • 8249 (Vocational and Trade Schools)
  • 8299 (Schools and Educational Services [Not Elsewhere Classified])
  • 8351 (Child Care Services)
• Ensures that all high-integrity risk MCCs are not eligible to be included in overseas BPSP-supplier
  flows
• Ensures that the following MCCs are not eligible to be included in BPSP-supplier flows, unless the buyer utilizing the BPSP provides to Visa a valid government-issued business identification number or Taxpayer Identification Number (TIN) upon Visa request:
  • 4900 (Utilities – Electric, Gas, Water, and Sanitary)
  • 6300 (Insurance Sales, Underwriting, and Premiums)
  • 6513 (Real Estate Agents and Managers)
  • 9311 (Tax Payments)
• Ensures that the MCC that most accurately describes a supplier’s business is assigned to the supplier
• Provides annual reporting to Visa directly, including:

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  Reporting to Visa

  • All reports are due on the 10th day of the following month
  • Please copy [email protected] in your emails with report submissions to Visa

  • Total Visa payment volume flowing through the BPSP
  • Total Visa payment volume of overseas payments
  • Breakdown of Visa payment volume by supplier MCC
  • Breakdown of Visa payment volume and Transaction count by Visa product type
  • Effective 13 April 2024 through 17 April 2027 Breakdown of Visa payment volume and
    Transaction count of the top 100 suppliers paid via Visa Consumer Cards
• Provides quarterly reporting to Visa on overseas payments including breakdown of payment volume and transaction count by country corridor (i.e. buyer country, BPSP country, and supplier country)
• Signs a separate agreement with Visa to ensure compliance with the Visa Rules, including but not limited to the above annual and quarterly reporting requirements

MasterCard BPSP Requirements

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NEW MasterCard Bill Payment Service Provider (BPSP) Program

Effective 1, January, 2025, Mastercard is revising its Standards to introduce a Business Payment Service Provider (BPSP) category and related requirements for commercial business-to-business (B2B) payments between buyers and suppliers.

Under the MasterCard BPSP construct, buyers may source suppliers globally, allowing buyers and suppliers to be located in different markets. Additionally, while payment from the BPSP to the supplier must be completed with a non-card method, the supplier may be a card-accepting merchant for non-BPSP transactions.

• BPSP will be registered with MasterCard through TabaPay.
• The BPSP must enter into a written agreement with the buyer. The agreement confirms, among other things, that chargeback rights for Goods or Services Not Provided will not apply (except when payment not properly applied to the buyer's account or a credit not processed) and requires the buyer to resolve any non-performance concerns directly with the supplier.
• Pursuant to the contractual agreement between the buyer and the BPSP, the buyer must pay the BPSP with a commercial card. Following the receipt of settlement funds from its acquirer, the BPSP must pay the supplier the invoiced amount as instructed by the buyer.
• The BPSP must pay the supplier using a non-card payment method, although that supplier may be a Mastercard-accepting merchant for non-BPSP transactions.
• The BPSP, each buyer initiating payment through the BPSP, and the buyer's commercial card issuer must be located within the area of use of the BPSP's acquirer. The supplier receiving payment through the BPSP may be located outside of the BPSP acquirer's area of use.
• The BPSP must only initiate a transaction in accordance with the buyer's payment instructions, for example, following the buyer's confirmation of the supplier's shipment of the goods or delivery of the goods or services and the buyer's approval of the payment.
• The BPSP must submit separate transactions for the payment of each invoice and implement a secure process for payment of funds into individual supplier accounts, provided that for a single supplier a BPSP may bundle transactions for the payment of multiple invoices from one buyer to that supplier.

American Express Bill Payment Provider (BPP) Program

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Data Requirements for American Express BPP Programs

Please follow data requirements for American Express BPP as shown here.

American Express Bill Payment Providers (BPPs) are third parties that allow American Express Cardmembers to make purchases at merchant establishments that may not accept the American Express Card.

The American Express Bill Payment Program (BPP) supports unique processing based on specific contracts between American Express and individual partner merchants. The merchant needs to enroll for BPP directly with American Express and they will assign a unique merchant ID. Specific merchant category codes are eligible for this program which will be addressed during the enrollment process with American Express.