Dive Brief:

• Payments processor Checkout.com is the latest payments player to receive a special purpose banking charter in Georgia, the company said in a news release Monday.
• A Georgia Department of Banking and Finance spokesperson confirmed Monday that the site received conditional approval for the merchant acquirer limited purpose bank charter (MALPB), which means that the company must meet certain conditions before receiving full approval.
• “Securing the charter allows Checkout.com to accelerate plans to operate as its own acquirer in the U.S.,” Checkout.com said in its Monday news release. “This move underscores a significant expansion of North American operations, anchored by a new strategic hub in Atlanta, Georgia, alongside established offices in New York and San Francisco.”

Dive Insight:

The charter lets a company bypass banks to underwrite merchants and authorize and settle transactions. Checkout.com is the third payments firm, following Fiserv and Stripe, to receive conditional approval for the charter in the past two years.

"They were issued a permit to begin business," said Bo Fears, the Georgia banking Department spokesperson, in a phone interview.

Fears said he could not disclose the conditions Checkout.com has to meet before receiving full approval.

A Checkout.com spokesperson did not respond to a request for comment on what the payment platform plans to do with the charter.

A list of the company’s customers on its website includes the buy now, pay later firm Klarna, the Chinese fast fashion seller Shein, the social media platform Pinterest and the ride-hailing service Uber.

The company, which is headquartered in London, will be able integrate directly into the Visa and Mastercard networks without a partner bank one is receives full approval.

"Direct U.S. card network integration will enable greater control, which helps unlock faster innovation and superior acceptance rates," the news release said.

The payment platform is on track to achieve full charter banking operations this year, according to the release. 

The release provided few additional details on how Checkout.com plans to use the MALPB, but consultants who follow the industry say the charter will save recipients money by cutting third parties like banks out of the payment process. 

Milwaukee-based Fiserv received conditional approval for the charter in October 2024, and Stripe — which has a dual headquarters in Dublin, Ireland, and San Francisco — was granted its own conditional approval last July.

Fiserv received full approval in April, making it the only company to do so.

One other company is also seeking the charter, Fears said Monday, although he declined to identify the additional applicant.