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Ask HN: How do market place startups collect payments?
All marketplaces like (eg: Vayable) collect payments from one party and then send that payment to a third party after taking a cut. I've seen that most payment systems (including Paypal, Amazon, Google, Stripe) do not allow these kind of transactions per their terms of service.
These are known in the industry as Third Party Payment Aggregators (ie like Amazon, Paypal themselves) and its very hard if not impossible to get a payment service to take you on if your doing this kind of a business.
How do these startups get around this?
- pg 15y agohttp://poundpay.com http://poundpay.com
- keeptrying 15y agoThey are turning away customers because of the same reason I put above.
- ig1 15y agoYou can use Paypal, but you need to use Paypal Adaptive Payments for it rather than a regular paypal account.
- keeptrying 15y agoThis requires the payer to create a paypal account which is a real problem.
- ig1 15y agoI don't think they have to. Fiverr uses Paypal Adaptive Payments and I've bought stuff on there without using a Paypal account. I use Paypal to charge my own customers (not using adaptive payments) and I had to upgrade my account to a business account before I could let customers pay without having to have a Paypal account. I'm guessing something similar applies to Adaptive Payments.
- keeptrying 15y agoThis is actually great information. Thanks a lot!
- LeBlanc 15y agoWePay built its API specifically to solve this problem: https://stage.wepay.com/developer/usecases/marketplace https://stage.wepay.com/developer/usecases/marketplace We allow easy account creation for your users, and you can charge your own fees on each transaction you facilitate. I'm one of the API developers at WePay, so if you have any questions, I'd be happy to help.
- keeptrying 15y agoHi Andrew thanks for your post but I have a few more questions: 1. Are there marketplaces using this method? Can you name a few please? 2. How are refunds managed? Would the payee have to go directly to the 3rd party that he has paid the money to? What would be the liabilities of the middleman for a chargeback? Thanks -Vivek
- LeBlanc 15y ago1) Yes, here are some marketplace type sites using the WePay API: http://bellstrike.com/ http://bellstrike.com/ http://www.everribbon.com/ http://www.everribbon.com/ http://www.listcharming.com/ http://www.listcharming.com/ http://www.attendstar.com/ http://www.attendstar.com/ 2) You can issue refunds for any payment in your marketplace with the /checkout/refund call. For chargebacks, we 1st attempt to get the money from the payee's WePay account, then from their bank account, and finally from the API application. We do a lot of really cool stuff that reduces the chargeback risk and fraud in general.
- ra 15y agoIs wepay only available in the US? or is it available internationally?
- LeBlanc 15y agoWe do accept international credit cards, but unfortunately the person accepting money has to be in the United States. We're working hard to expand internationally though!