Payment splitting is the process of dividing one incoming payment among two or more recipients, and it is described in detail under split payment. The main entry covers the transaction itself. Payment splitting is the name more often given to the capability, the feature a payment provider offers to platforms so that the division happens automatically according to rules the platform sets.
The standard case is a marketplace. A buyer pays 100 dollars in a single transaction; the provider's ledger allocates the platform's commission, its take rate, to the platform and the rest to the seller, who is registered with the provider as a sub-merchant. An order containing goods from several sellers, or a delivery fee owed to a courier company, is divided among all of them. Each party's share is then paid out separately in a marketplace payout. Deducting the platform's fee before paying the seller is a form of fee netting.
Splitting at the provider level means the platform never takes possession of the sellers' money, which is central to how marketplace payments are structured for regulatory purposes. The phrase is also used loosely for a customer dividing a bill among friends or across two cards, which is a different arrangement.