February 2, 2016
Written by
James Davis
Written by James Davis
Senior Technical Writer at United Thinkers

Author of the Paylosophy blog, a veteran writer, and a stock analyst with extensive knowledge and experience in the financial services industry that allows me to cover the latest payment industry news, developments, and insights. Read more

Reviewed by
Kathrine Pensatori
Product Specialist at United Thinkers

Product specialist with more than 10 years of experience in the Payment Processing Industry. I help payment facilitators and PSPs solve their various payment processing issues. Read more

When do You Need Split Funding?

Key Takeaways

  • Split Funding in Modern Merchant Services: Split funding is essential when multiple parties are involved in a transaction, such as resellers, ISOs, MSPs, and others. Modern payment processing software must effectively divide payments to ensure each party receives its share of the revenue, including handling fees like convenience fees and merchant service commissions.
  • PayPal Adaptive Payments as an Example: PayPal’s adaptive payment system exemplifies this concept, offering tools for automatically splitting transaction amounts among various vendors on a per-transaction basis, catering to complex payment distribution needs.
  • Importance for Tax and Fee Allocation: Businesses needing to account for taxes, convenience fees, and merchant services commissions in their transactions should seek a payment gateway capable of efficiently managing split funding to minimize costs.
  • Finding Suitable Payment Gateway Solutions: Solutions like UniPay Gateway, featured on the PayVisors website, are designed to meet specific business needs in the realm of split funding, offering flexibility and robust functionality for complex payment distributions.


Split funding is one of the most important concepts in the modern merchant services industry. The need for split payments, naturally, arises when the process of purchase of products or services involves some entities beside the seller and the buyer. Even initially, these entities already included resellers, independent sales organizations (ISO), and merchant services providers (MSP). However, in modern market, the new concepts, such as convenience fees, merchant services reserves, and others emerged. As a result, modern payment processing software has to be able to divide payments in such a way that every party involved gets its share of residual revenue.

PayPal adaptive payments system

For example, PayPal with its adaptive payments system is offering a flexible tool, allowing its customers to automatically split purchase amounts and residual revenues among all the vendors involved in the purchase on a per-transaction basis.

If you need to take taxes, convenience fees, and other kinds of merchant services commissions into account while accepting payments, you’d better look for a payment gateway, which is capable of handling split funding for you at the lowest possible cost.

At PayVisors website you will find more information on split funding, adaptive payments, and modern flexible and robust payment gateway software solutions, such as UniPay Gateway, which suit your business needs, particularly, in the area of split funding

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