[klynch]

Kristi from Braintree here.

We wrote our own underwriting software that connects our online signup process with years of data and experience underwriting tech companies. That combination of better software, years of data and more experience with tech companies makes us way more efficient than traditional payment providers.

As for who assumes the risk: the merchant is responsible for chargebacks first. If the merchant fails to cover those chargebacks, the risk then typically sits with the payment provider. If the payment provider is not able to cover the risk, the bank then stands behind the payment provider.

[BallinBige]

pretty sure you are just an aggregator. Visa & MC are making this more 'feasible'

[klynch]

Kristi from Braintree again.

All of our merchants get their own merchant account during our onboarding process.

Admittedly, it's a complex process behind the scenes. We know that a lot of people are interested in how we do this, and we want to be completely transparent about our business practices. We plan on putting out a blog post explaining it all in detail in the coming weeks.

You can subscribe to our RSS feed at http://feeds.feedburner.com/braintree for updates.

[tzs]

I've tried on occasion to figure out all the players involved in processing a payment, and their relationships and responsibilities. It is complicated because (1) so many companies offer multiple services (gateway, merchant account, etc) and their documentation blurs the distinction, and (2) some companies use different names for the same thing.

Here was my best attempt: http://news.ycombinator.com/item?id=2445866

If your blog post could cover all the components I tried to cover there--but without the errors I probably made and with the gaps filled, I and many others would be grateful and ecstatic.