Dealing with merchant processor transition

March 07, 2026

by a searcher from University of California, Los Angeles - UCLA Anderson School of Management in Santa Monica, CA, USA

When you do an asset sale how have you ensured that your merchant processing is handed over smoothly? Do you apply before the deal or get an assignment of the existing contract? I just want to avoid being unable to take credit/debit cards on day one.

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Reply by an intermediary
from The University of Chicago in Chicago, IL, USA

1) The question you asked is very important, but it needs addressing in both the Asset and Stock. 2) There are many more aspects of the deal, not just merchant processing that need addressing like ACH credit/debit, city license, insurance, benefit programs, etc. Most issues are same between Asset and Stock. 3) Trying to get things done pre-closing risks disclosing that the business is for sale to 3rd parties. As M&A broker over 35+ years, we manage this ultra carefully and only with seller approval for timing. Typically, we allow after APA/SPA and other docs have gone through few rounds of review. 4) In almost all cases, seller winds up with cash (e.g. ACH credit goes to seller bank account even if buyer bought A/R). And buyer winds up getting an A/P invoice that was seller responsibility. Lawyers button things up. But the LAST thing you want is lawsuits before you learn employee names. These matters do not become an issue if both sides develop a good relationship during the process.

Reply by a searcher
from Emory University in Tucson, AZ, USA

Reach out to the processor beforehand to establish an account, ensure your bank routing is working properly, etc. It's also a good time to validate you are receiving competitive rates - so ask around. You'll need to understand if the company is utilizing hardware and if so, is it owned or leased. If leased, it's much easier to have the processor send new correctly programmed terminals in advance of the changeover. If it's a POS, ERP, or other software that's capturing the credit card, you'll need to make sure you have access to the software's integration plus the gateway it's tied to for processing. 9/10 times Authorize.net is the gateway being used and you'll establish an account in advance with the gateway.

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