qrinox_connect-fundflow | Stripe Developers | Page 1

surreal cedarBOT Oct 28, 2024, 6:43 PM

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azure frigate Oct 28, 2024, 6:44 PM

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Implemented: Stripe Connect (Express Accounts). We have three roles:

Customer (the one who Pays for a Service)
Service Provider (the one who fullfills a Service)
Plattform (us who provides the Plattform)

We have the following payments:

When Customer books a Service, the customer Pays 100% of the Price to the Service Provider. The Payout is Manual, so the Plattform decides, when the payout happens.
During initial payment, the Customer Pays 5% non refundable Plattform fee to the Plattform
After succesfully completing the Service, we want to charge the Service Provider 20% Provision

Now we want to have invoices for all of the cases.

Invoice Plattform to Customer (5%)
Invoice Service Provider to Customer (100%)
Invoice Plattform to Service Provider (20% of the 100%)

Can we accomplish this with stripe invoicing? Especially the 20% to 100%, is this possible with the API of Stripe Invoicing?

atomic lark Oct 28, 2024, 6:44 PM

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qrinox_connect-fundflow

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it doesn't really make sense to me honestly. If the Customer pays 100% of the funds upfront, why don't you take the 20% for your fee immediately?

azure frigate Oct 28, 2024, 6:46 PM

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Its more a strategic approach, as for the Brand this fee might look a bit too much

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While for the influencers 20% is industry standard

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And also we get 20% provision only after the completion of the service and its possible that the money gets refunded by 100%

surreal cedarBOT Oct 28, 2024, 6:47 PM

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azure frigate Oct 28, 2024, 6:47 PM

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So until the service is fullfilled, we actually do not and should not own the 20%

atomic lark Oct 28, 2024, 6:48 PM

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yeah that doesn;t really make sense to me. If the Customer paid 100% you should take your 20% that way. Otherwise you're going to struggle with this, taking a share of the payment during the payment is the right flow really

azure frigate Oct 28, 2024, 6:49 PM

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Hmm, but there are multiple plattforms especially in the influencer industry which does this

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Upwork for example also does it this way

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Upwork does take marketplace fee from customer, while the provision afterwards from the freelancer

noble ivy Oct 28, 2024, 6:53 PM

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Gotcha, unfortunately there isn't really a great way to take 20% that much later in Stripe. Typically we encourage platforms to split the funds once, some platforms do wait a bit to do that, but they largely don't send money and then take some back.

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Is there a specific benefit to sending that money initially and then taking it back? Happy to file feedback or a feature request for making that flow easier if it is a standard practice

azure frigate Oct 28, 2024, 6:57 PM

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The benefit is mostly strategic, basically its easier to convice a customer to book a service from a plattform if they dont see 20% additional service fee in the beginning. They are not confronted in general with this amount of provision fee's, which will actually make think them twice before actually booking on our plattform. While influencers are used to the 20% provision they miss out when they work on a plattform / through agencies

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However I understand this process is not easy to implement with stripe / stripe invoicing. Then I have a follow up question:

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If we take the 20% in the very beginning, is there any issue regarding refunds? Because if the influencer does not deliver, then there will be a 100% refund back to the customer. (80% + 20%). So is there any issue for this if we take the 20% in the beginning?

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Possible additional transaction costs etc.

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And additional question, can we charge with "marketplace"-fees (5%), which is non-refundable, and a service-fee (20%), which is refundable?

noble ivy Oct 28, 2024, 7:08 PM

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If we take the 20% in the very beginning, is there any issue regarding refunds? Because if the influencer does not deliver, then there will be a 100% refund back to the customer. (80% + 20%). So is there any issue for this if we take the 20% in the beginning?
Yes, when creating a refund we have a reverse_transfer parameter that tells Stripe to pull back any funds that were sent to your account for the refund
https://docs.stripe.com/api/refunds/create#create_refund-reverse_transfer

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You can also manually reverse the transfer or part of the transfer. This could technically be used to take 20% back but may get complicated https://docs.stripe.com/api/transfer_reversals

azure frigate Oct 28, 2024, 7:09 PM

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Yes, my question was if we (the plattform) can charge two indipendent fees at once which will handled different when refund case comes

noble ivy Oct 28, 2024, 7:10 PM

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One more quick thing before that but we also have account debits for things like additional fees.
https://docs.stripe.com/connect/account-debits

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Thinking on that question

azure frigate Oct 28, 2024, 7:10 PM

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So we would charge two fees, one for marketplace fee 5%, non refundable, and one service fee 20%, which is refundable

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The problem is, the brand can actually book multiple influencers at once

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Some can get refundet, the others may succeed

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So we would have to charge the brand with x amount of times of the fees for each influencer if we need to make it refundable without a problem

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We cant make a "total sum" of service fees because each influencer is actually handled different regarding completion or refund of the campaign, so we actually really need to charge the influencer if we want to have a clean approach for this

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Is there really no way to implement it right now, even though if its not standard?

noble ivy Oct 28, 2024, 7:15 PM

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Gotcha, happy to lay out how this can work. One quick question up top, do you currently have any of our connect charge flows implemented? As in do you already have destination charges or separate charges and transfers up and running at least in test mode?
https://docs.stripe.com/connect/separate-charges-and-transfers

azure frigate Oct 28, 2024, 7:15 PM

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Yes we have implemented seperate charges and transfers

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And the process actually works up until the 20% charge later on from us to the influencer and creating an invoice for it

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My developer mentioned its possible but for this we would need to give our influencers (connected accounts) the "customer" privilege is that correct?

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And if so, what are the consequences

noble ivy Oct 28, 2024, 7:20 PM

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I am not sure what "customer privilege" may mean there. Accounts have something called capabilities, but there isn't a customer one and for SC&C I think only the transfers capability matters

azure frigate Oct 28, 2024, 7:21 PM

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Alright then Im open for any suggestions I can discuss with my developers, this would really help if you know any practicable approach 🙂

noble ivy Oct 28, 2024, 7:22 PM

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Now that I look at it again I am realizing that I am a bit unclear on how you want this to work. Can you explain how you want the fees to work for a $100 payment in this scenario?

azure frigate Oct 28, 2024, 7:24 PM

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Alright, so for example the Brand (Customer) chooses two influencers with 50€ each.

So the costs the Brand should see:
5€ Marketplace fee (Plattform fee, non refundable)
50€ For Influencer1
50€ For Influencer2

Influencer1 successfully completes the campaign. Now we will charge the influencer with 20% (10€)
Influencer2 fails to complete the campgin, 50€ will get refunded to the Brand

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Influencer1 can payout the 80% (40€)

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Is this understandable?

noble ivy Oct 28, 2024, 7:28 PM

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Is the 5€ part of the 10€ that you are charging each user later?

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Oh or are you actually charging the end customer 105€?

azure frigate Oct 28, 2024, 7:29 PM

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Nope the 5€ (5%) is a total of the complete campaign which is not refundable, its on top of the 100% of the influencer costs

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Yes we are chargin 105€ sorry for the confusion

noble ivy Oct 28, 2024, 7:36 PM

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Gotcha. So typically in Stripe this would mean that you charge the 105 and then transfer the 40 to each connected account as they complete their job. That is the simplest way to do it and would mean that for refunds you would just have to reverse the transfers to the appropriate accounts before making the create refund API call.

We don't have a way to differentiate that the 5 is non-refundable, but you can issue partial refunds. So in your situation, you would reverse the transfer to the connected account and then create a refund while specifying amount: 5000
https://docs.stripe.com/api/refunds/create#create_refund-amount

Create a refund | Stripe API Reference

Complete reference documentation for the Stripe API. Includes code snippets and examples for our Python, Java, PHP, Node.js, Go, Ruby, and .NET libraries.

azure frigate Oct 28, 2024, 7:37 PM

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Alright but how will it look like regarding invoicing, will we need to charge with 20% for each of the provision the customer or can we charge the influencer for the 20%?

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Because if we have to charge the customer, then it will look like this:

5€ Marketplace fee (Plattform fee, non refundable)
40€ For Influencer1
10€ Service Fee from Influencer1
40€ For Influencer2
10€ Service Fee from Influencer2

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This means double of the amount of invoices for the brand

noble ivy Oct 28, 2024, 7:40 PM

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From the brand's perspective this can only be one charge and the invoice items can be whatever you want them to be. We don't surface anything about the transfers that you create after they make the payment.

azure frigate Oct 28, 2024, 7:41 PM

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So Stripe Invoicing doesnt care about who the money was charged to? We can charge from brand, but still make an invoice from plattform to influencer?

noble ivy Oct 28, 2024, 7:42 PM

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Unfortunately we don't really have a way to generate invoices between a platform account and its connected account. The user's Express dashboard will show the amounts that are transferred to them and debited from their account but it is a list of transaction rather than invoices for specific payments

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The payments list on this page gives a good example of what typical payments will look like from the user's side given our default UI https://docs.stripe.com/connect/get-started-connect-embedded-components

azure frigate Oct 28, 2024, 7:43 PM

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Alright so there is no way for us actually making invoice work between plattform and connect accounts

noble ivy Oct 28, 2024, 7:43 PM

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So you can generate your own invoices to represent this kind of thing, I'm just giving the heads up that we don't have this kind of thing pre-built

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Correct, at the moment in Stripe invoices are only for charging customers

azure frigate Oct 28, 2024, 7:44 PM

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Alright understood

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Thanks so much for clarification @noble ivy you really helped us a lot 🙂

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I wish you a good day / evening!

noble ivy Oct 28, 2024, 7:45 PM

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Of course, happy I could help. Connect is definitely a lot to wrap your mind around at first

#qrinox_connect-fundflow