A paymaster is someone appointed by a group of buyers, sellers, investors or lenders to receive, hold, and dispense funds, commissions, fees, salaries (remuneration) or other trade, loan, or sales proceeds within the private sector or public sector.
When dealing with commission payments on contracts dealing with large amounts of money (such as oil, gas, steel, iron, gold, MTNs, VGs, t-strips, and other instruments), most banks in the United States are very wary of handling such large amounts of money.
In most cases, the buyer and the seller involved in the transaction require a paymaster be named to handle all incoming and outgoing funds.
In return for their services the paymaster charges a small fee, which is paid directly to them out of the commission proceeds prior to disbursement.
In the American Civil War era, a paymaster was generally a commissioned person in the army who held the relative rank of captain or major, depending on cumulative time in service of the person and the period in which they served (the regulations changed over time).