Merchant of Record

How does the merchant of record role work?

The legal seller, the product business, and the customer

The customer’s sale contract identifies the seller. That may be the business that makes the product, or a third party appointed to resell it. A business can therefore be its own merchant of record; buying an MoR service is a choice about which entity takes that customer-facing role for the covered sales.

In a third-party resale arrangement, the product business and the customer have different relationships with the MoR. The business appoints the reseller under a supplier agreement, and the reseller sells to the buyer under the customer terms. These are two commercial relationships behind what the customer experiences as one purchase. They do not require the customer to make two payments.

For example, imagine buying a software subscription from a developer’s website, with Paddle identified as the seller at checkout. Under Paddle’s resale agreement, Paddle resells the product and issues the customer’s sales invoice, while the supplier fulfils the order and provides technical and delivery support. The developer still supplies the software even though another entity handles the sale. This is one contractual model; other arrangements need their own agreements checked.

The division matters when the customer needs help. A question about an invoice concerns the seller’s billing function. A login failure or missing software feature can still require the developer’s support team. Moving the sale to an MoR does not, by itself, move the work of delivering and maintaining the product. The agreement between supplier and reseller also governs settlement to the supplier.

Caption: Illustrative third-party resale model. Branches show responsibilities, not timing or extra customer payments. Supplier delivery and contractual deductions remain separate from the MoR’s customer-facing role.

Seller identity should also be recognizable throughout the purchase. Check the contracting entity in the customer terms against the checkout notice, invoice or receipt, card statement descriptor, and refund or dispute communications. Stripe’s MoR guidance recommends consistent presentation across these surfaces because conflicting identities can confuse buyers and lead to disputes. A statement descriptor may include a recognizable product or brand suffix, so the name on a card statement alone is an incomplete test. Read it alongside the actual sale terms and invoice.

From checkout to settlement, refund, or dispute

A completed checkout starts several connected processes: collecting payment, recording the sale, delivering the product, and calculating what the product business will receive. Each handoff needs an owner, including when a sale is later reversed.

At checkout, confirm which payment methods and currencies the service supports for the intended buyers. Authorization and capture can be separate: an authorization approves the payment, while capture collects it. Timing depends on the method and arrangement. For a physical-goods example, Global-e’s sale terms distinguish card preauthorization from capture and describe different timing for wallet payments. That example does not establish when a software subscription should activate. For covered transactions, the MoR’s billing process also needs to apply the relevant tax treatment and produce the customer’s invoice or receipt.

The product business then needs to connect the billing result to fulfilment. For software, that can mean granting an account access after a successful purchase and updating access when a subscription changes. Paddle’s subscription provisioning guidance uses billing-event notifications to keep the application in sync. The integration must account for repeated notifications and events arriving out of order; otherwise, a valid payment can leave a customer without access or an old event can overwrite a later subscription state. Billing support and product support need enough shared order information to resolve such cases.

Settlement follows the supplier agreement’s schedule and calculation. The amount paid to the business can reflect taxes, fees and adjustments associated with refunds or disputes, with some funds retained under the agreement. It need not match the checkout amount or arrive when the buyer pays. Keep the order and adjustment references so finance can explain the difference between the customer payment and the supplier payout.

Consider a customer who buys an annual subscription and asks to cancel after one month. First establish whether the request stops the next renewal, ends current access, or also seeks a refund. These are separate decisions. Under Paddle’s buyer terms, cancellation takes effect at the end of the current billing period, while refund requests depend on the applicable policy and law. Cancellation alone therefore does not create an automatic eleven-month refund. If a refund is approved or required, route it through the seller’s billing process, record the adjustment, and update product access according to the applicable entitlement policy.

A chargeback takes a different route: the customer disputes the payment through their issuer. The MoR may handle the customer-facing dispute while needing order, delivery or usage evidence from the product business. Agree who supplies that evidence and by when. Customer-facing responsibility also differs from who ultimately bears the cost: Paddle’s supplier agreement, for example, permits refund and chargeback costs to be passed back through contractual deductions. An MoR handling the case does not guarantee that the supplier’s payout is protected.

How does an MoR differ from other payment roles?

Payment processors, gateways, and payment facilitators

A payment provider can collect and route money while the product business remains the seller. To distinguish the roles, separate the service used to accept payment from the entity responsible for the customer sale.

Role or service	What it does	What to establish separately
Payment processor	Processes the payment through the chosen payment arrangement	Which entity sells to the buyer and provides transaction recourse
Payment gateway	Provides the payment acceptance and transaction-management interface	Whose merchant arrangement supports the payment and whether a resale agreement exists
Payment facilitator	Processes for submerchants and can receive settlement for onward distribution	Whether the platform or a submerchant is the customer-facing seller
Third-party MoR in a resale model	Sells the covered product to the customer under the resale arrangement	The precise contractual scope, retained supplier duties and deductions

A merchant account supports card acceptance. It can be offered alongside a gateway or arranged separately, so a gateway contract alone does not describe the whole payment setup. Nor does the appearance of the checkout decide who sells. A hosted page, an embedded form, or a custom interface connected through an API describes how payment acceptance is integrated. A business can change that interface without changing its customer sale contract.

An intermediary receiving the money first does not settle the question of who sells. In Worldpay’s payment-facilitator model, submerchants send transaction information through the facilitator, which receives settlement and distributes funds onward. That money flow does not by itself establish that the facilitator resells the underlying products. Identify the parties’ commercial responsibilities before interpreting their payment routing.

Check the specific product as well as the provider’s name. For example, Stripe’s Managed Payments comparison identifies Stripe as MoR for that product and the business as MoR for its other payment products. Buying ordinary processing from a brand that also offers an MoR service does not give the business the same contractual arrangement. For a proposed setup, ask which entity appears as seller, which agreement creates that role, and which customer transactions the selected product covers.

Seller of record, marketplace operator, and other record roles

Treat “seller of record” as a term to resolve in the proposed arrangement. Do not assume a fixed division in which the seller of record delivers the product and the merchant of record handles only payment. Establish who contracts with the buyer, whose sales invoice is issued, and whom the buyer can hold responsible for the transaction. The same entity may occupy the roles described by both labels; a provider’s terminology needs to match its actual agreement.

A marketplace requires the same examination. It can be structured around the platform reselling products, or around individual sellers remaining responsible for their customer sales. A platform’s commission and its ability to split proceeds do not answer which structure applies. Imagine a buyer’s payment being divided between a product business and a platform: the division could represent a seller paying a platform fee, or a reseller settling with its supplier. To distinguish them, inspect the buyer’s contract and the platform–business agreement alongside the payment flow. Stripe’s merchant-identification guidance similarly calls for determining the commercial role before choosing a technical charge configuration.

“Of record” also appears in workforce arrangements, including Employer of Record (EOR) and Contractor of Record (COR). Those terms concern a different relationship from a customer buying a product. Choosing an MoR for software sales does not settle whether the people building that software are employees or independent contractors. Keep the customer-sales agreement and the workforce arrangement separate when assessing the business’s obligations.

Which obligations move to an MoR, and which remain?

Transaction taxes and the limits of tax coverage

An MoR service can take on VAT, GST or sales-tax work for covered sales under its terms. That scope can include registration, calculating and collecting the tax, filing returns, remitting tax to the authority, and issuing customer tax invoices. Confirm each function rather than assuming that a tax calculation at checkout proves responsibility for the subsequent return and payment.

Coverage depends on the actual transaction. For example, Stripe’s Managed Payments tax documentation identifies circumstances in which it cannot assume indirect-tax liability and obligations remain with the business. Payment availability and tax coverage therefore need separate checks. A service accepting a customer’s payment does not establish that it handles every tax obligation arising from that sale.

Ask for a written coverage assessment using the business’s own sales facts:

• Seller and buyer locations: confirm the relevant entities and countries, including domestic sales as well as cross-border sales.
• Customer type: identify sales to businesses and consumers, and how the service establishes the customer’s status.
• Product classification: describe what is supplied and how it is delivered, including any bundled services.
• Exclusions and start date: identify unsupported transactions and establish which sales fall within the service period. Review historical sales separately rather than assuming onboarding resolves prior-period exposure.

Changing the seller can also change the transaction-tax result for the same purchase. As a conditional UK illustration, consider a consumer buying a genuinely taxable product at a nonzero VAT rate. Suppose the direct seller is lawfully outside VAT registration: it is neither obliged to register nor voluntarily registered. A VAT-registered reseller selling that same product may instead need to charge VAT, assuming no exemption or relief changes the result. This follows from HMRC’s seller-specific registration rules and charging rules, rather than a special rule that every MoR charges tax. Turnover below a threshold alone does not establish lawful nonregistration; establishment, voluntary registration and exceptions matter. Nonregistration is also different from a product being exempt or zero-rated. Both sellers may already have the same treatment, so a change is not inevitable.

Before comparing prices, hold the basket, product, buyer location and status, and transaction date constant. Ask the proposed provider and the business’s tax adviser to confirm each selling entity’s actual treatment in writing, including registration status and obligations, the applicable threshold base, and any exemption or relief. Do not carry the direct seller’s threshold position across to the reseller by assumption.

If the confirmed resale treatment introduces a nonzero transaction tax, the pricing decision has two possible directions. Holding the final customer total fixed leaves a smaller pretax amount before fees and other costs; preserving the pretax amount raises the customer total. HMRC’s VAT-inclusive and VAT-exclusive calculations explain this mechanism. For an explicitly hypothetical comparison, assume the direct sale requires no tax collection and the proposed resale requires an assumed 20% transaction tax:

Hypothetical pricing choice for the same basket	Final buyer total	Transaction tax	Pretax amount available before fees and other costs
Direct sale under the assumed no-collection treatment	120	0	120
Resale keeping the buyer total at 120	120	20	100
Resale preserving the pretax amount of 120	144	24	120

The rate, amounts and differing tax treatments are illustrative assumptions, not a provider offer or a universally available small-business exemption. The resale rows show alternative pricing policies. Calculating from a tax-exclusive amount does not authorize hiding the resulting tax: in the UK, price lists aimed only at the general public show VAT-inclusive prices.

Use the comparison to decide whether the proposed arrangement leaves enough room for the intended margin at an acceptable buyer price. These pretax amounts are not the supplier’s payout, recognized revenue or profit. Apply the reseller’s purchase and settlement terms, fees, supplier-side taxes and other costs next. This tax-outcome comparison is separate from the fee-base comparison below, which holds the customer tax constant while changing how a provider’s fee is calculated.

A platform’s actual activities can also affect its tax obligations. In its guidance for relevant digital services supplied to consumers, HMRC describes when a platform accounts for VAT. Its conditions consider identification in contracts and invoices together with authority over charging, delivery and general terms. A provider that only processes payment is treated separately. Apply the full test to the arrangement; a payment route or a contractual label alone is insufficient. This is a scoped UK VAT example, rather than a global rule for all MoR services or marketplaces.

The product business still needs its own tax and accounting review. Paddle’s supplier agreement, for example, retains supplier-side obligations and permits recourse for inaccurate product information. Paddle’s payout-document guidance also distinguishes handled sales tax from the supplier’s corporation-tax needs. The supplier-to-reseller relationship needs its own tax assessment. Give finance both the customer-sale coverage and the supplier agreement so it can identify the invoicing, reporting and income-tax duties that remain.

Security, fraud, customer support, and contractual recourse

The service agreement determines which risks the MoR handles and which costs it can recover from the product business. Review the customer-facing promise alongside the supplier’s obligations. A provider answering a refund request or defending a disputed payment can still have a contractual right to deduct the resulting cost from the supplier’s funds.

For example, Paddle’s agreement assigns billing and order support to Paddle while retaining supplier technical and delivery support, product warranties and indemnities. It also permits refund and chargeback costs to affect the supplier’s balance. The resale licence does not transfer the supplier’s ownership of its product IP. This allocation explains why an MoR can handle the transaction while the developer remains responsible for a defective product, failed delivery or a claim about its rights to sell the software, within the contract’s terms.

For fraud and disputes, obtain a written responsibility map. Establish who selects or operates the payment controls, who can decline or review an order, and when the supplier must provide delivery or usage evidence. Check the evidence format, response deadline and consequences of a missed request in the actual process. Then identify the exclusions, deductions and indemnities that affect who bears a loss. A promise to manage fraud is insufficient to establish unconditional chargeback protection. Also confirm that the product and selling countries are permitted; a risk allocation for an approved sale may not answer what happens when the supplier breaches an eligibility restriction.

Security scope needs its own assessment. The PCI Security Standards Council’s outsourcing guidance says that merchants outsourcing processing still need to verify provider compliance and define shared responsibilities. For an MoR integration, establish what payment data the business’s systems actually receive and confirm the applicable validation requirements with the entity responsible for accepting that validation. Avoid inferring the business’s PCI obligations solely from the MoR label or the provider’s certification.

Customer data raises separate questions. Identify which customer and order information the business receives, its permitted uses, access controls, retention and export options. Paddle’s data-sharing terms, for instance, separately address lawful use, security and direct marketing. Access to a buyer’s email for product support does not establish unrestricted permission to use it for every marketing purpose. Make sure billing and product-support teams can exchange the information needed to resolve a case within the agreed data rules.

Digital products, human-delivered services, and physical goods

Describe how the customer receives the product before deciding whether it fits an MoR service. An online checkout can sell automatically delivered software, live teaching or a shipped item, but those offers need different eligibility and tax assessments. “Sold online” is too broad a product description for either decision.

An online course illustrates the distinction. In its UK digital-services VAT guidance, HMRC uses automation and minimal human involvement to describe the relevant electronically supplied services. Its examples distinguish automatically delivered prerecorded video or PDF courses from live webinars and an online course with live tutor support. This is a boundary within the specified digital-service rules: being outside those rules does not make a course VAT-exempt. HMRC also says its examples are not definitive, and a bundle needs assessment as a single supply or multiple supplies. Do not infer that adding any amount of human support always produces the same tax result.

For a course combining recorded lessons and tutoring, prepare a description of what is automated, what teachers actually do, and how the components are sold together. Use it for two separate checks. First, obtain the applicable tax classification and treatment of the bundle. Second, ask the prospective MoR to confirm that it accepts that exact offer. A tax conclusion cannot substitute for commercial approval. For example, Paddle’s eligibility guidance excludes physical products and human services unrelated to software; its acceptance rules are a separate question from HMRC’s tax categories. Neither source establishes that a particular mixed course will be accepted.

Caption: UK tax example: delivery method and human involvement affect the digital-service analysis. Confirm tax classification and provider acceptance separately. Outside these digital-service rules does not mean VAT-exempt. HMRC digital-services VAT guidance

Physical-goods MoR arrangements also exist. Global-e’s sale terms, for example, identify its merchant role and separately address importer identity, shipping and returns. For a goods offer, verify who appears as importer in customs records, who supplies the required information, which party pays duties and shipping charges, and who manages a return and its costs. The MoR label alone does not establish the importer of record or promise that every logistics task is included. For US imports, 19 USC 1484 sets separate eligibility and entry-information requirements for the importer of record. A service designed for digital products and a service covering shipped goods should be evaluated against the actual offer and destination countries.

When should a business use an MoR service?

Global software and ecommerce: convenience, control, and alternatives

Consider an MoR service when the work it takes on addresses a concrete gap in the business’s ability to sell and support transactions. Compare that gap with the control, costs and provider dependence the arrangement introduces. Selling internationally or reaching a particular revenue level does not, on its own, decide the choice.

These hypothetical businesses would approach the decision differently:

Business situation	Potential reason to consider an MoR	Decision to resolve
A small digital-product seller with limited finance capacity	Consolidate covered payment and transaction-tax work instead of coordinating it internally	Does the service cover the actual product and intended customers? The founder still needs capacity for product support, reconciliation and retained tax duties.
A SaaS business expanding into new markets	Add suitable payment methods, currencies and localized checkout alongside covered tax handling	Compare the proposed launch work with the existing stack, including subscription and access integration. Test whether the service improves the intended market’s purchase flow before relying on it for expansion.
An enterprise software seller with a finance and tax team	Outsource a defined sales channel or geography while using existing internal expertise elsewhere	Will customers accept the MoR’s entity in procurement and on invoices? Assess the value of outsourced work against changes to negotiated terms, customer relationships and reporting.
A physical-goods brand selling cross-border	Use a service whose scope fits the goods, destinations and customer purchase process	Evaluate shipping, importer identity, duties and returns alongside payment and tax scope. A digital-product MoR offer is insufficient evidence of fit.

For each case, compare the provider’s coverage with the team’s actual workload: registrations and filing, payment operations, security responsibilities, billing support and financial reconciliation. Assess payment reach through the methods and currencies the target customers need. Localization and time to market belong in the comparison, but estimate them from the required implementation and approvals rather than assuming outsourcing produces an immediate launch.

Decide how much authority the business needs over checkout, pricing, refund decisions, customer communications and access to transaction data. Review product and country restrictions and the effect of a provider changing its terms, restricting sales or ending the relationship. These dependencies matter even when the service covers the current sales plan.

Keeping the business as its own merchant is an alternative: it can combine payment processing with tax tools and internal or external specialists. That approach requires someone to own the work between those services. A selective rollout may also be worth evaluating, with an MoR used for specific products or markets and a direct sales arrangement elsewhere, where the agreements permit it. Compare both routes against the same sales scope and retained workload before choosing.

Marketplace and B2B sales models

For a marketplace, choose the intended customer-sales model before configuring commissions and payouts. If the platform resells suppliers’ products, its supplier agreements and buyer terms need to support that role. If individual sellers remain the merchants, the platform’s processing and payout arrangements need to reflect their customer-facing responsibilities. Dividing proceeds among recipients is compatible with different commercial models and cannot make this decision for the platform.

An MoR arrangement also needs to fit how a business customer buys. Consider a software buyer that requires supplier approval and a purchase order before it pays an invoice. Establish which entity the buyer must onboard in its procurement system, which entity accepts the purchase order, and whose invoice accounts payable will receive. If the buyer has approved only the developer but the proposed seller is a reseller, resolve that mismatch before the order is placed. Ask whether the service supports the required invoice details, tax identifiers, payment terms and procurement documents; those capabilities do not follow from the MoR label.

Partner, reseller and direct channels may coexist where their agreements permit them. For example, Paddle’s resale appointment is non-exclusive. For a proposed hybrid setup, map which seller handles each channel and how sales, renewals and customer support are assigned. This gives procurement and finance a way to identify the relevant agreement and invoice for a particular order, rather than treating all company sales as one flow.

Trade credit requires a further check. If a customer wants to pay later, establish who grants those terms, who owns and collects the receivable, when the product business is paid, and who bears non-payment risk. If the business plans to finance or sell receivables, confirm that it owns the receivable it proposes to transfer and obtain any required contractual consent. The customer’s debt to a reseller and the reseller’s settlement obligation to the supplier are different relationships. A service that supports B2B invoicing does not automatically promise trade credit, early payment or permission to finance either receivable.

What do MoR fees and payouts mean for the business?

Compare total cost on the same sales assumptions

Compare offers using the same orders, customer locations, payment methods, currencies and refund assumptions. A headline percentage leaves out both the amount to which it applies and the work the business will still perform.

Suppose a hypothetical order has a pretax price of 100 units and an assumed tax amount of 20 units, making the customer payment 120. Two hypothetical quotes both say “5% + 0.50,” but one applies the percentage before tax and the other applies it to the tax-inclusive checkout amount.

Hypothetical calculation	Percentage on pretax price	Percentage on checkout amount
Fee base	100.00	120.00
Fee at 5% + 0.50	5.50	6.50
Amount remaining after tax and fee, before other deductions	94.50	93.50
Fees for 1,000 identical orders	5,500.00	6,500.00

These figures illustrate fee mechanics, not a provider tariff or a country’s tax rate. The same quoted percentage produces different costs because the bases differ. The fixed charge also makes order count and average order value relevant: compare the expected basket of sales rather than applying a percentage to total revenue and stopping there. Confirm whether the quoted fee itself includes or excludes any applicable tax on the service.

Request the contractual treatment of the other items that matter for that basket:

• Billing and service charges: subscription management, invoicing or other extras, minimum commitments and any volume terms.
• Methods and currency: charges for the intended payment methods, currency conversion, and conversion between collection and payout currencies.
• Reversals: which fees are retained or reversed on a refund, dispute charges, and any costs passed back to the supplier.
• Payouts: payout fees, minimum payout amounts, settlement schedule and any temporary reserves or other holds.

Treat these as questions for the offer, rather than assuming every service imposes every charge. Separate permanent fees from cash that is temporarily unavailable. A reserve can reduce the amount paid now without being an additional earned fee; the agreement needs to explain its release or use to cover liabilities. Payout timing also affects how much operating cash the business must supply while it waits.

Finally, compare the full operating arrangements. With an MoR, allow for retained product support, finance reconciliation, supplier-side tax work and integration maintenance. With the business acting as its own merchant, include the processing, tax tools and people needed to handle the responsibilities it keeps. Use the actual workload and quotes for both routes. Neither the headline fee nor a universal revenue threshold can establish which arrangement costs less for the business.

Reconcile orders, tax, fees, and net settlements

Reconcile the payout to the underlying sales and adjustments before using it in the accounts. The bank deposit tells finance how much cash arrived; it does not separately identify sales, customer tax, service fees, refunded amounts or money still held by the provider.

For a hypothetical period, start with 120 units collected at checkout. Deduct 20 units of assumed tax and a hypothetical fee of 6.50, calculated as 5% of the tax-inclusive 120 plus 0.50. A further approved net refund adjustment of 10 and a temporary reserve of 5 leave 78.50 payable now:

120 − 20 − 6.50 − 10 − 5 = 78.50

The 10-unit refund adjustment represents the net balance movement after any associated tax or fee reversals, so tax is not deducted twice. The 5-unit reserve remains subject to release or offset under the agreement; it is not an additional earned fee. All quantities are illustrative, with no country tax rate or real provider tariff implied. This is an aggregate cash bridge for a period, rather than a single-order refund policy or a revenue calculation.

Caption: All amounts are hypothetical units. Fee: 5% of tax-inclusive 120 + 0.50. The net refund adjustment includes related reversals; tax is not deducted twice. The temporary reserve is held under terms. This is a cash bridge, not revenue or profit.

Build the audit trail from each order through its later adjustments to the payout. Retain order and transaction IDs, subscription references, refund or adjustment IDs, and event and dispute references where available. Record the original transaction currency, the provider’s balance or settlement currency, the payout currency, and any conversions between them. The business also needs its own conversion into its accounting functional currency; that is an accounting layer, rather than a field every provider report supplies.

Use timestamps with their time zones and the relevant reporting cut-offs so that a late refund or next-period payout can be traced correctly. Match the payout or remittance reference to the bank entry. Paddle’s reconciliation documentation, for example, connects balance movements, transaction and adjustment identifiers, currencies and remittance information. Check that the selected provider’s reports supply enough detail to reproduce the bridge, including chargebacks, retained fees and reserves as separate items where relevant.

Revenue presentation requires a separate judgment. Under the IFRS Foundation’s software-reseller analysis of IFRS 15, the principal-versus-agent assessment identifies the specified good or service and evaluates control before transfer. Fulfilment responsibility, inventory risk and pricing discretion are indicators considered in context. The MoR label and a net deposit cannot replace that contract-specific assessment or dictate gross or net presentation for every product business. Finance needs the applicable accounting framework, both commercial agreements and the transaction records.

Timing is another separate issue. A customer may prepay for an annual subscription while the business delivers service over the subscription period. The receipt of cash, the provider’s settlement and the recognition of revenue can therefore follow different schedules. Keep the billing and service-period records alongside cancellation and refund adjustments, rather than treating the bank date as the service-delivery date.

A monthly exception review can identify unmatched payouts, unexplained deductions, missing reversals and reserves awaiting release. Assign each difference an owner and supporting reference, and distinguish a timing difference from a calculation error. This creates a record finance can resolve without guessing from the net amount received.

What should you verify before onboarding or leaving an MoR?

Contract, coverage, checkout, and technical handoffs

Before committing to an integration, obtain written answers for the actual product, selling entity, customers and markets. Then test whether the purchase and reporting flows implement those answers. A general feature list leaves too much unresolved for both operations and finance.

Review the agreement and proposed checkout together:

• Eligibility and tax scope: describe the product, delivery method, bundles and intended countries. Confirm acceptance and the applicable tax categories, including exclusions and the date coverage starts.
• Seller and procurement identity: identify the contracting seller and check its presentation in checkout notices, customer terms, invoices and statement descriptors. For B2B sales, resolve vendor onboarding, purchase orders and required invoice details before accepting the order.
• Money and recourse: document the fee base and extras, payout schedule, thresholds, reserves, release conditions and permitted deductions. Obtain a sample settlement report and make sure finance can reconcile it to orders and the bank.
• Operational ownership: assign billing, product support, fraud review and dispute evidence to named teams. Specify response times, escalation routes and service-level commitments in the agreement or operating procedure, rather than assuming a standard deadline.
• Security and access: map payment and customer data passing through the business’s systems. Review API permissions, credential management and the agreed allocation of security and data-use responsibilities.

Test the complete customer journey with the methods and currencies intended for launch. Check successful and failed payments, required tax-ID collection, invoice output and the customer’s route to billing support. Assess payment performance in the actual intended flow; support for a local method on a feature page is only the starting point. If affiliates or partners are part of the channel, verify how attribution survives checkout and appears in the relevant records.

For subscriptions, test initial access, renewals, payment failures and retries, upgrades or downgrades, prorated adjustments where used, cancellation and refunds. Confirm what each event does to both billing and product access. A refund test is incomplete if money moves correctly but the application retains the wrong entitlement. Check repeated and out-of-order webhook notifications, and establish how the team will detect and repair a mismatch between billing state and the application.

Finally, verify the transition from test to production. Paddle’s go-live checklist, for example, distinguishes sandbox testing from live credentials, catalog and settings, and includes a final live purchase check. For the selected service, plan a controlled low-value live purchase and its reporting and refund checks before general rollout. Record the checkout, invoice, access result and settlement evidence so the team can review one transaction end to end. Use the provider’s actual supported test environment and procedures; capabilities and configuration do not necessarily carry over unchanged into production.

Customer data, subscriptions, and the exit plan

Agree the exit process before the service becomes essential to renewals and customer support. Separate the transfer of customer records, saved payment credentials and active subscriptions: an export for one purpose may not provide what the others require.

For customer and transaction records, obtain the available fields, file formats, export frequency and access period in writing. Check which information the business may lawfully retain and use, which recipients can receive it, and whether notices or consent are needed for the intended transfer. Save the order, invoice, refund, dispute and payout history needed for ongoing support and reconciliation before access ends.

Saved payment methods require a transfer process between the relevant providers. Stripe’s payment-data export documentation requires secure transfer to a compliant receiving processor, excludes credentials saved through Link, and treats payment history and subscription objects separately from the card-data export. This does not establish what another MoR will export. Ask both the departing and receiving services which credentials can transfer and whether any customers will need to provide payment details again. Do not plan around the business downloading raw card data itself.

For active subscriptions, map each customer’s plan, price, renewal date, paid-through period and current status to the receiving system. Determine whether the customer contract and payment authorization can continue under the new seller and what action or communication is required. Assign responsibility for preventing duplicate renewals and preserving product access during the change. If selective migration or running both arrangements for a period is proposed, confirm the contractual permissions, customer groups and cut-off dates first. These are transition options to agree, rather than automatic rights.

Termination also leaves a financial and support tail. Paddle’s agreement, for example, preserves accrued obligations and permits funds to be retained for potential liabilities, while also addressing the disabling of API access. Leaving therefore need not produce an immediate final payout or continued access to the same tools. Establish who handles cancellations, refunds and chargebacks for old sales, who supplies evidence, and who maintains product access through any remaining paid term.

Request an exit schedule naming the owner, assistance, delivery format and deadline for each handoff. Include the last report export, outstanding reserve and dispute balances, the conditions for releasing retained funds, and a final reconciliation to the bank. The business should be able to support an old customer and explain a later adjustment even after new sales have moved elsewhere.