Site icon Websites 'N' More

Marketplace Payments: Split Payments among Multiple Receivers: What are the Options?

This blog aims to compare some of the popular options for payment gateways that enable merchants to run an online marketplace.

A few weeks ago our Web Development team came across an interesting scenario, an enquiry came through which involved providing a solution to a client who was looking to set up an eCommerce store that involved selling goods online but rather than a straightforward payment solution, they were looking to split the payments amongst multiple parties (receivers).

This was something completely new for our eCommerce development team and something we did quite an in-depth research on prior to providing the client with all the possible options.

While conducting our research we found out that Payment gateways that allow you to split payments are based around the marketplace business model. The marketplace business model is different from the traditional eCommerce store because there are more than two parties involved in a typical transaction, the Marketplace owner (Facilitator or Platform owner), the Supplier (Seller or Account holder on the market) and finally the buyer i.e. the individual who buys the goods from the marketplace.

During our research we found many payment gateways supporting the marketplace business, however, a lot of them catered to the US and European markets only. This made us eliminate most of the available choices as the client was AU based.

Here are some options that we came across during our research:

In this article, we have covered some of the most popular and well-known options worldwide as it was not possible to cover all the payment gateways. We envision adding a few more AU based payment gateways to the list in the near future.

Adaptive Payments by PayPal

NOTE- This is now a limited release product as stated on PayPal’s website. At the moment the product is available to select partners only and cannot be used without prior approval from Paypal. As per the information available on a forum one of the prerequisites to get approved for PayPal is to have an established business with a minimum amount of yearly sales.

Adaptive Payment is a solution provided by Paypal that allows payments to be split amongst multiple receiving parties.

There are three kinds of payments that PayPal Adaptive can handle:

Things You Should Know about Paypal Adaptive

Braintree Marketplace

Braintree is a part of the PayPal group and offers a similar solution to PayPal’s Adaptive Payments. With Braintree, you get the flexibility of accepting payments through a variety of methods like credit cards, bank transfers, PayPal and other leading wallets through a single integration.

For splitting payments for a particular transaction amongst multiple parties, Braintree provides a solution by the name of Marketplace.  In a typical scenario, as explained by Braintree within their developer’s section, a Master merchant (the owner of a marketplace) allows multiple Sub-merchants (Seller in the marketplace) to sell goods on his/her marketplace and in return charge a service fee to the sub-merchant when the item is sold.

Things you should know about Braintree Marketplace:

Stripe Connect    

Much like the above two payment gateways, Stripe Connect also allows a store owner to move funds of a particular transaction across different connected Stripe accounts.

There are three types of accounts that you can choose from in order to facilitate split payments with Stripe Connect. The main difference between each of the accounts is the amount of control the store/platform owner gets for managing the overall operations including integration, user dashboard access, payout timing and post-integration support.

The three types of accounts are as follows:

Standard Account- The simplest of the three accounts whereby the platform user controls all the payment flows from their dashboard. Multiple users can connect to a platform as long as they own a Stripe account. Each user has a relationship directly with stripe and has the ability to disconnect from the platform.

Highlights of Standard Accounts Include:

Express Account- Currently in its Beta phase, this type of account provides the platform owner with the ability to specify the flow of funds amongst users and the responsibility for handling disputes and refunds.

The platform owner has more control over the payment functionality and can schedule frequency payouts, perform manual payments and settle a payout instantly. Express account holders have a basic view dashboard allows them to manage their profile, view payments and payouts to their bank.

Highlights of an Express Accounts Include:

Custom Account- A Custom Stripe account is the most complex type of account that Stripe has to offer and provides complete control to the platform owner. Stripe essentially acts as an invisible party throughout the process, from the integration of the payment gateway to the settlement of payments.

 The platform owner has the ability to change all the account settings including the bank account. And a custom account holder does not get access to a dashboard like in the case of other Stripe accounts. This is because Stripe expects you as the platform owner to have the necessary infrastructure in place to handle account holders.

Highlights of a Custom Accounts Include:

PromisePay (Now Known as Assembly Payments)   

An Australian born and bred company that has been purpose-built to facilitate payments for marketplaces and platforms and allows you to make and receive payments from and single or multiple buyers or sellers.

Use cases of Assemble Payments:

Things you should know about Assembly Payments:


Currently available to US-based businesses only, Dwolla is another contender when it comes to managing payments for marketplace based business models.

As explained by Dwolla, a marketplace can have the following type of transactions:

While at first, these two type payments might look quite similar, this is not the case as both these parties have a very different goal or objective. From the pay-in perspective, a customer would typically like a seamless checkout experience with the ability to pay using different payment methods such as credit cards, PayPal or even a bank transfer.

On the other end of the spectrum are your suppliers (Pay-out) who expect to get timely payments for the goods/services that are being sold through your marketplace. This is facilitated through something called the ACH transfers.

Things you should know about Dwolla’s Payout Feature:

If you are thinking of developing an online marketplace or need some help with integrating the right payment solution for your online marketplace please feel free to get in touch with Websites ‘N’  More, a digital agency in Sydney, Australia, focusing on providing custom web development solutions to businesses across multiple industry sectors.

About Us:

We are Websites ‘N’ More, a digital agency based in Newtown, Sydney specialising in web development and digital marketing including SEO.

Some of the web development projects we have undertaken include:

In terms of SEO, we have undertaken the following projects:

Exit mobile version