What Is an Independent Sales Organization (ISO) in Payment Processing?
If you’ve recently heard the term ISO in payment processing, you might be wondering: What exactly is it, and why does everyone in the payments industry talk about it?
In simple terms, an Independent Sales Organization (ISO) is a company or individual that resells merchant services—like credit card processing and point-of-sale (POS) systems—to businesses. ISOs act as middlemen between payment processors and merchants, often earning residual income on every transaction processed.
Let’s break this down so you fully understand what an ISO is, how it fits into the merchant services ecosystem, and whether it might be the right opportunity for you.
How ISOs Fit into the Merchant Services Ecosystem
To process credit or debit card payments, a merchant needs several things:
- A merchant account
- A payment processor (like Fiserv or Stripe)
- Often, a POS system or terminal
Most business owners don’t deal directly with payment processors. That’s where ISOs step in.
ISOs partner with these processors and bring in small businesses (restaurants, retailers, e-commerce stores, etc.) as clients. In return, they get a share of the processing revenue, which is known as residual income.
Think of an ISO as a reseller or affiliate, but one that can make a lifetime monthly income from every merchant they sign.
ISO vs. MSP: What's the Difference?​
A common confusion: “What’s the difference between an ISO and an MSP?”
|
Term |
Meaning |
|
ISO |
Independent Sales Organization – registered with Visa/Mastercard to resell processing services. |
|
MSP |
Merchant Services Provider – similar to ISOs, but usually refers to providers working with MasterCard. Sometimes used interchangeably with ISO. |
In practice, most people just say “ISO” to refer to any sales partner or agency that resells payment services.
ISO Agents vs. Registered ISOs: Know the Roles
Not everyone in this business is a registered ISO.
|
Role |
Description |
|
ISO Agent |
Works under a registered ISO. Doesn’t need their own registration. Ideal for beginners. |
|
Registered ISO |
Fully registered business that can create sub-agents and put their logo on merchant statements. More autonomy, more cost. |
Most people start as ISO agents and later register fully if they want more control.
How Do ISOs Make Money?
This is the part most people care about—and for good reason.
ISOs earn residual income, which means they get paid a percentage of the fees businesses pay for credit card processing. For example:
- A merchant processes $50,000/month
- The processing fee is 2.9% ($1,450)
- The ISO gets a cut of that (let’s say 0.5%) = $250/month
Now imagine doing that with 20 or 50 clients. That’s recurring revenue, every month, without selling again.
That’s why many agents move from low-paying vendors to 100% residual programs like PAYS POS.
Should You Become an ISO? Pros & Cons
Here’s what you should consider:
Pros
- Residual income for life (like royalties)
- Low start-up costs (especially as an agent)
- Huge market (millions of small businesses)
- Flexibility: sell any way you want (online, in-person, via agents)
Cons
- Can be competitive
- Some vendors offer low revenue shares (30–50%)
- No income until you sell
- Customer service issues if the vendor is weak
This is why picking the right ISO program is critical to your long-term success.
How to Join a High-Payout ISO Program
If you’re interested in becoming an ISO or switching from a low-paying vendor, look for programs that offer:
100% lifetime residuals
Free training & support
POS systems + payment terminals
Fast approval and funding process
PAYS POS offers exactly that — with ISOs earning top-tier pay-outs, full control, and lifetime residuals from Day 1.
Apply to the Pays POS ISO Program and start building your recurring income today.
Conclusion
To recap:
- An ISO resells payment processing and POS services to merchants.
- They earn residuals, which can become a predictable, growing monthly income.
- You don’t have to be registered to start—you can begin as an agent.
- Choosing the right partner makes all the difference.
If you’re looking to earn more, get paid for the long term, and finally partner with a platform that puts ISOs first, we’d love to talk.
