Payment Processing

What sort of payment processing options are available?

At present only two, debit card processing and ACH processing. For debit card processing you would have to qualify with the underlying merchant processor. Credit card processing and FedWire transfers are not supported.

What does the “Monthly Commitment” imply in the pricing sheet?

The monthly commitment means that the total amount paid by the Client for:

  • Monthly Fee
  • Debit Card Processing Fee
  • ACH Processing fee

For a particular month should at least be US$ 2,000.

If applicable, the monthly commitment does not cover other fee items like AWS fee (if you opt for it), Bank Account Verification fee, website/app maintenance fee (if you opt for it), compliance fee, etc.

For example,

Case 1
Monthly Fee: US$ 1,000
Debit Card Processing fee: US$ 800
ACH Processing fee: US$ 150
Total: US$ 1,950
Total Amount payable: US$ 2,000

Case 2
Monthly Fee: US$ 1,000
Debit Card Processing fee: US$ 800
ACH Processing fee: US$ 1,200
Total: US$ 3,000
Total Amount payable: US$ 3,000

Which would be the minimum and maximum amount that a client can pay using Debit Card? And How much is the minimum that a client can send using ACH?

Whether you do debit card or ACH, the minimum is US$ 50. The maximum is set at US$ 2,000. Both of these are on a per transactions basis, i.e. minimum US$ 50 per transaction and a maximum US$ 2,000 per transaction. Both for ACH and Debit Card processing.

How can there be a fraud in this (money transfer business)? I don’t know about the business and that is why I asked if it comes with some kind of chargeback or fraud protection for us.

No business is fraud-free. To understand why there is fraud, you have to understand that by law in the United States you are allowed to do reversals up to 180 days from the date of transaction (you can read up on Consumer Financial Protection Bureau).

Some people simply have nefarious intent. They will do the transaction, make the payout happen in the beneficiary country, and then claim, the transaction was a fraud, etc. Sometimes customers don’t understand the charge on their statement and do a reversal without thinking it through. Sometimes, a joint-account is operated and the balance in the account may be $1,800 and the wife has written a check for $1,200 whilst the husband is trying to send $1,500 back home. An NSF (Non-Sufficient Funds) charge occurs. Regardless, the chargeback onus falls on you, as neither the bank wants to take it – neither the sponsor, i.e. principal license holder. While a lot many features are implemented to reduce the chances of fraud happening, the way the US structure for consumer financial protection is set up, it is prone to abuse. This is the nature of the business. You can argue, this way or that way, at the end of the day, the structure is as such, you are responsible for putting up the reserve for any chargebacks, till such time they are investigated, etc.

Can I use my own merchant processor?

No, you cannot use your own merchant processor.

Can we use PayPal, Square Cash, Venmo, Zelle, etc. to collect money?

No. As per the Terms of Service of these providers, collecting money for the purpose of international remittances is not allowed. If you are classified as a money services businesses and/or are engaged in money transmission, you then you cannot use their services for receiving &/or sending money without first obtaining a no-objection certificate from them, otherwise, both your user and you would be in direct violation of the various terms of service and the account(s) and the monies can be suspended and forfeited respectively.

You might want to watch this brief video for further clarification: 3rd Party Payment Apps? It Might Be Illegal To Use Them!

Who is in charge of authorizing the transactions? Will it be myself or someone else?

No. Transactions are authorized by the parties involved, i.e. the Sender, the banking institutions, processing partners, and the payout beneficiaries. As a non-licensed entity (you), you are not involved in the flow of money or its authorization. The whole idea of a sponsored & white-label arrangement is to make sure that the licensed entities involved are the ones who engage in the authorization and flow of funds for the objective that you are seeking under the white-label service.

Can we use our own payment processor?

Only if you are a payment facilitator and have an Agent-based relationship with the US solution provider. The reason is, when you use your own payment processor you are in the custody of funds and hence break the chain of licensure continuity. Your own payment processor is a contract with your company and your processor. The US solution provider is not a party to that contract and neither do they have a primary chain of custody to client funds. Hence the answer is no.

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