How Patriot List Payments Work
We have a simple yet powerful mission at Patriot List: Empower people and communities economically, through the trust and goodwill found in their personal reputation on and offline, to make money selling their goods and services safely. We know that every human being has stuff they no longer need or want and every human being has skills that can benefit others in their community. Patriot List enables people, neighbors, neighborhoods, and entire towns to transact in a safe and secure way. Patriot List allows buyers to purchase goods and services directly from local sellers. At Patriot List everyone can have their own storefront from which to sell their goods and services. The Patriot List payment experience is an important part of what makes Patriot List safe, secure, and great. Here is how it all works.
If you have any experience with systems that move money around (charging credit cards or transferring money via ACH) you’re fully aware that the actual flow of funds is dizzyingly complicated.
On Patriot List, however, a storefront owner will receive their funds in their bank account only after a transaction has been made and the return policy -24hrs- has past (Money is held in Escrow).
This is a convenience few other services on the planet provide, and we’re very proud of it. The purpose of the escrow is for the trust and safety of both the buyer and the seller. The escrow process ensures the buyer has ample time to make sure the product looks and works as advertised before payment is complete and it allows the seller to ensure that the buyers money is legitimate (checks won’t bounce, counterfeit money recognized, reduction is crime-you don’t have to carry around large sums of cash)
So, how does it work?
The details of charging credit cards and transferring funds to Patriot List buyers and sellers is quite simple, despite the complexity of the underlying banking infrastructure. We have two fundamental fund-moving primitives — money-in (by charging a credit/debit card) and money-out (by transferring funds to a bank account). We use a payment provider called Stripe
to carry out the details of these operations.
Using Stripe as our payment provider has been a really fantastic experience, and here’s why:
A completely white-labeled payment solution
. Our users never have to be redirected to another website or get emails from our payment provider. Our users are always dealing with us, and we deal with Stripe behind the scenes.
. Just charge the buyer, and the money shows up in your bank account once the transaction has taken place and the return period has ended. Simple as that.
Credit card gateway and ACH provider under one roof
. Credit card payments and ACH credits move in and out of the same account. There are two things worth mentioning that make this extremely powerful.
First, credit/debit card payments are used to purchase — as soon as the Stripe API operation to capture a charge succeeds, the funds are available in the Patriot List escrow account for subsequent API operations (Most credit card gateways impose some sort of holding period). What this means is that as soon we successfully charge a buyer, we collect our fee, hold the money in Escrow and transfer the remainder to the storefront owner (seller) via next-day ACH once the product is delivered and the 24hr return policy time period has ended.
The result of this is the second, very crucial point: you do not need to manage a “float” balance to ensure you’ll make payout that day. This is a *huge* reduction in operational and cognitive overhead, and cannot be understated.
Stripe as the authoritative ledger
. Knowing that we can rely on the integrity of the Stripe ledger and record of what took place enabled us to move faster to get to launch. Don’t underestimate the value of relying on the experts in their area of expertise, so you can focus on yours.
Free merchant identity verification
. As part of the process to create merchant accounts for storefront owners, Stripe verifies the storefront owners identity as part of the process, and they try to do it in the least intrusive manner possible, by not asking for the user’s social security number unless absolutely necessary.
Small company, personalized customer service
. Stripe is still a relatively small company, and being an API service, they are extremely developer-friendly. Having the experts that built the system at the ready to help is hugely important as a customer to an API service. The Stripe staff was extremely helpful throughout our implementation process, and they continue to be valuable as support cases come up. Getting help with an issue is as simple as shooting over an email or hopping into their IRC channel.