A merchant is defined as “an entity that accepts payment cards bearing the logos of any of the five members of PCI SSC (American Express, Discover, JCB, MasterCard, or Visa) as a payment for goods and/or services.”. A Service Provider is defined as a “Business entity that is not a payment brand, directly involved in the processing, storage, or transmission of cardholder data on behalf of another entity. This also includes companies that provide services that control or could impact the security of cardholder data.”. So, if you take card payments for any goods or services, you would be a merchant. If you don’t take card payments, but store, process or transmit cardholder data on behalf of a merchant or other party, you would be a service provider. It is not uncommon for an entity to be a service provider to merchants, while being a merchant themselves.