Top 10 US Merchant Acquirers Processed $10.6 Trillion in 2024

The payments landscape in the United States has seen substantial growth, with the top 10 merchant acquirers collectively processing $10.6 trillion in card volume during 2024. This impressive figure, detailed in The Strawhecker Group's (TSG) latest Directory of US Merchant Acquirers, highlights the concentration and scale of the market, with strategic bank partnerships and integrated software-led growth playing pivotal roles.

Market Dominance and Key Players

JP Morgan Chase & Co.

Leading the pack, JP Morgan Chase & Co. processed an estimated $2.6 trillion in US card payments across 50 billion transactions. This figure underscores the bank's dominance in the acquirer market, largely driven by its extensive distribution network and strategic partnerships.

Square's Influence

Square stands out as a significant player, particularly in terms of merchant count. The company serves nearly four million businesses, highlighting its stronghold among small to medium-sized enterprises (SMEs) and sole traders. This broad reach demonstrates Square's ability to cater to a diverse client base, reinforcing its position in the market.

Concentration and Consolidation

The top five acquirers collectively handled approximately $8 trillion in card volume, indicating a high level of market concentration. These firms benefit from robust distribution channels through direct banking arms or strategic partnerships with financial institutions. Notably, almost 60% of total card volume is concentrated within these top five firms, while the top 25 account for nearly 90% of the volume, showcasing the ongoing consolidation trend within the sector.

Barriers to Entry

The clustering of volume among a few large entities presents a significant barrier to entry for new players. This concentration emphasizes the importance of scale, particularly as providers aim to enhance their technology stacks, underwriting models, and risk controls to maintain competitive advantages.

Industry Resources and Growth

TSG's directory, now in its fifteenth year, has become a definitive industry resource. It profiles over 300 merchant acquirers, 530 sponsor bank relationships, and more than 900 processing arrangements, collectively representing over $13 trillion in annual processing volume.

Strategic Partnerships and Platforms

Authorize.net, a Visa-owned payment gateway, remains the most widely integrated gateway across the acquirer base, cited by 41% of providers. Similarly, Fiserv's Clover continues to gain traction, now offered by 41% of acquirers, up from 38% the previous year. These platforms highlight the critical role of strategic partnerships and platform choices in differentiating acquirers in the market.

Software-Driven Models and Emerging Trends

Integrated software vendors (ISVs) have become a core sales channel, with 72% of the top 50 acquirers by volume employing this route to market. This trend underscores the shift towards software-driven models, which are increasingly favored for their ability to streamline operations and enhance service offerings.

Surcharging and Dual Pricing Models

Surcharging and dual pricing models have also seen significant growth, with over 51% of acquirers marketing such solutions, up from 43% the previous year. These models offer flexibility and transparency, appealing to both merchants and consumers.

Vertical SaaS Propositions

Toast, focused on the restaurant vertical, has emerged as the 14th largest acquirer by volume. This growth signals the strength of vertical SaaS propositions, which cater to specific industry needs and offer tailored solutions.

Conclusion

The US merchant acquirer market in 2024 has been characterized by significant growth and consolidation, with the top 10 players processing $10.6 trillion in card volume. Dominated by giants like JP Morgan Chase & Co. and Square, the market remains highly concentrated, presenting barriers to entry but also opportunities for those with strategic partnerships and innovative solutions. As the industry continues to evolve, integrated software models and specialized vertical solutions like Toast's will likely play an increasingly important role in shaping the future of merchant services.