finance, merchant-servicesSay for example, a non-profit corporation of 4 members needs to pay their electric bill ($10), rent ($10), and water bill ($10) for the month. They need to send out a bill of $7.50 to each member. Each member pays the $7.50 bill with their credit card to the corporation. Then the corporation pays to the utility companies each $10.
If this were done with credit cards, then each transaction would be almost instantaneous but would incur large charges from member->corp, then corp->3rd party (essentially taking 2x merchant fees).
If this were done with ACH, then each transaction would be cheaper so 2x fees is less important but the transactions take 1-3 days which would mean less time before the 3rd parties get paid.
Assuming all transactions occur online (so cash is non-option) within the same marketplace (so one system manages all transactions), is there a way to have instant transactions & lower merchant fees (ideally 1x fees) when paying out 3rd parties directly from members?
You might be able do the first part of the transaction for free with - https://venmo.com/ or https://square.com/cash (You can transfer between bank accounts in the US for free so its good for members-»corporation) Then you can make the payment to the utility companies as you would do it otherwise.
If its small amounts of money its a valid solution but if its higher numbers you should consult with an accountant regarding the local tax implications.
Stripe Transfer API has the ability to pull directly into my own account using credit card transactions, then push out to 3rd party bank accounts or debit cards. This does take 2-days to settle the initial transfer but prevents the corporation from needing to pay 2x merchant fees (instead its 2.9%+$.30 for initial cc charge, then $.25 for each transfer).
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