Stripe Connect is a robust platform that empowers businesses to build and expand their own custom marketplaces, service platforms, and more. At the core of this functionality lies the Stripe Platform account, a crucial element for any marketplace owner looking to facilitate transactions and manage funds securely.
Understanding Stripe Platform Accounts
A Stripe Platform account serves as the nerve center of your marketplace. It's a dedicated Stripe account that acts as the central hub for processing payments, connecting sellers and buyers, and overseeing the flow of funds. As a marketplace owner, your Platform account is where the action begins.
The Role of Connected Accounts
Connected Accounts are the lifeblood of your marketplace. These are standard Stripe accounts that your sellers or service providers set up to receive payments from customers. Each Connected Account is associated with your Platform account, ensuring a seamless and controlled payment flow.
In the Stripe ecosystem, a "Charge" signifies the process of collecting payment from a customer's chosen payment method. When a customer makes a payment on your platform, Stripe securely handles the transaction, ensuring the funds are transferred accurately and securely.
"Transfers" are the crucial step in ensuring that your sellers receive their earnings promptly. Initiated by your marketplace through the Stripe API, transfers move funds from your Platform account to the respective Connected Accounts, guaranteeing that sellers get what they've earned.
Payouts are the final piece of the puzzle. They involve sending funds from your Stripe account to external bank accounts, allowing your sellers to access their earnings. With our platform's Stripe integration, you can automate this process, ensuring a seamless experience for your sellers.
For product marketplaces, buyers can request a refund when the order is in "Delivered" status. For service marketplace, buyers can request a refund when the order is in "Job completed" status.
When the buyer requests a refund, the seller is notified and can decide to accept or reject the refund request. If the seller accepts the refund, the admin is notified via auto email and will be required to manually process the refund from the marketplace Stripe account as well as reverse the transfer (seller payment). If the seller rejects the refund, the admin is notified via auto email and is required to make the final decision. If they decide to honor the refund, they will need to process it manually from the marketplace Stripe account as well as reverse the transfer (seller payment.
The marketplace owner can reverse transfers even after the seller's payment has already processed to their bank account. When the marketplace owner reverses a transfer, the transfer amount is added to the marketplace Stripe balance and reduces the connected accounts (seller) balance. The connected account available balance must be greater than the reversal amount. So the important thing here is to make sure the seller has a balance available in their Stripe balance when reversing a transfer.
How It All Comes Together
Customer Payment: A customer makes a payment on your platform for a product or service.
Charge Processing: Stripe handles the payment securely, factoring in their own fees as well as any commissions or extra charges set by your platform.
Funds in Your Stripe Account: The funds from the payment are initially held in your Platform account.
Transfers to Sellers: When an Order is completed on your marketplace, a Transfer is initiated to the Connected Accounts of sellers, ensuring they receive their earnings.
Payout to Bank Account: Sellers receive their earnings directly into their designated bank accounts, creating a hassle-free experience.
Stripe Connect puts you, the marketplace owner, in the driver's seat. By leveraging the power of a Stripe Platform account and Connected Accounts, you can create a seamless, efficient, and secure payment ecosystem for your platform. Understanding the flow of Charges, Transfers, and Payouts empowers you to manage financial transactions with confidence. With Stripe Connect, you can focus on growing your marketplace and providing exceptional service to your users.