: How do I get Paypal or a merchant account for a marketplace style web site? I'm having trouble getting approved for a merchant account for my website. Basically I have expert users and users.
I'm having trouble getting approved for a merchant account for my website.
Basically I have expert users and users.
Expert users provide a service through my website which they set their own rates.
Users purchase the services, then pay me, I give 90% to the expert users.
I have been told this is factoring..
Is the way around this, a system like freelancer.com does?
Where users deposit money into their freelancer account, then pay for the services they won? What are the negatives to this system?
What about sites like 99designs? They accept CC payments and then pay the winning designer. How are some sites doing this but I'm having so much trouble getting approved?
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If you're in the US you can safely rule out using a true merchant account for this as no merchant account provider will touch this as it is factoring and is a huge no-no. This means you will be left with third party providers as your only options. This means higher fees and less flexibility but at least it becomes an option for you. I'm pretty sure SitePoint, who runs 99designs, uses Worldpay as their payment provider. I wouldn't be surprised if they have to have a large reserve to cover Worldpay if they suddenly get lots of chargebacks.
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