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Merchant of Record

lastmod 2026-11-03created 2026-02-076 edits

What is a Merchant of Record (MoR)? A service that acts as the legal seller (seller of record) in transactions with customers on your behalf. The seller name on the credit card statement shows the MoR company (e.g., Paddle) instead of your company.

What the MoR handles for you

  • Payment processing (cards, PayPal, local payment methods, etc.)
  • Tax calculation, collection, and remittance (VAT, GST, sales tax, etc., per country)
  • Refund and chargeback handling
  • Compliance with payment security standards such as PCI DSS
  • Fraud prevention
  • Regulatory compliance in each country

WARNING

Not the same as filing a final VAT return

Why use an MoR

To sell products abroad, you would normally have to handle tax registration, local entity setup, and integration of local payment methods in each country yourself. An MoR lets you delegate all of this, so developers can focus solely on building the product.

Paddle — Best fit for SaaS

  • Fees: 5% + $0.50 per transaction
  • Specialized in SaaS and digital products, offering an all-in-one package from payments and subscription management to tax compliance, revenue analytics, and churn prevention. Paddle automatically calculates, collects, and remits taxes in over 100 countries.
  • Strengths: B2B invoicing and advanced subscription management
  • Korean businesses can sign up, and payouts can be received via PayPal or an overseas bank account

Lemon Squeezy — Ideal for indie developers and solo founders

  • Fees: 5% + $0.50 per transaction
  • Acquired by Stripe in 2024, with payment methods fully integrated in 2025. Ruul
  • Clean UI, fast onboarding, built-in affiliate portal
  • Supports digital products, SaaS subscriptions, and license key sales
  • Payouts via PayPal or direct bank transfer

FastSpring — Strong for software and game sales

  • Fees: 5.9% + $0.95 (standard) or 8.9% (flat)
  • Enterprise-grade features such as license key management, affiliate marketing, and B2B invoicing
  • Long-standing know-how in selling desktop software and games

Gumroad — Digital content sales (simple but expensive)

  • Fees: 10% + $0.50 per transaction
  • Marketplace exposure helps discoverability
  • Very simple to set up, but the high fees make it inefficient as revenue grows

Dodo Payments — Newcomer MoR

  • Promotes itself as explicitly supporting Korean SaaS companies expanding globally

Polar

Creem

See also

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