The concept of online marketplace became relevant after rapid development of companies, which chose online marketplace model as their basic business model. The most well-known examples include Uber, eBay, as well as Amazon.

In the online marketplace model credit card processing has its peculiarities. Transaction processing mechanism, used in marketplaces, has to be capable of splitting the overall transaction amount into several (more than two) parts, which are then deposited to different entities. Beside the merchant and the processor, these entities can include marketplace owner, online marketplace software vendor, and different types of affiliates.

In order to be able to effectively distribute the amount of every transaction among multiple parties, the company, which follows online marketplace business model, needs to implement split funding functionality. Consequently, if you decide to provide online marketplace services, you need to partner with a payment platform, which supports split funding logic.

More detailed information on online marketplaces can be found in the respective article on Paylosophy.