What is the difference between payment gateway and merchant account?

Earlier I had confusion a between payment gateway and merchant account. I thought both do same functions but that's not true. Payment gateway allows you to do online money transactions and let you to process them. On the other hand a merchant account function as a holding account where your transferred payments are being collected before they are deposited into regular bank account. Which means you need both a payment gateway and merchant account to process your online payments. Still have confusion? No worries, just ask your doubts here, I will answer them.