Payment and Deposit Delays / PushPress vs. Other Gym Management Systems

March 30, 2020
TLDR;

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  • Our Stripe contact has assured us that they do not and will not implement blanket payment delay changes to PushPress clients
  • With PushPress, you own your own relationship with Stripe, thus Stripe will not take aggregate actions against your payments; they will evaluate your risk on your individual basis.
  • As long as you are not experiencing high volume of chargebacks, you should not be at risk of an extended holdback at this time.

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Recently, a payments and management system in our space has placed a 14 day hold on their client deposits. Another company a week previous completely suspended all payments without notifying their clients.

To clarify, any payments processing system operates from a standpoint of risk. They evaluate their portfolios based on the likelihood of risk, as measured in chargebacks and fraud potential.

Let's take a look at how PushPress is setup and why we are not subject to those risks as of today.

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Why Payment Holds Happen

Payment holds are implemented when there is significant risk in any underlying business that would represent additional chance for a chargeback or fraud.Holdbacks are put in place to use as a reserve to pay the chargebacks. They are a mechanism to provide insurance for a payments processor to make sure the chargebacks are paid, and the merchant does not run.The more payments you process, the larger risk you appear to a payments processing system, since a percentage of your business means a larger absolute dollar amount they are liable for in the case of chargebacks.[/et_pb_text][/et_pb_column][et_pb_column type="2_5" _builder_version="4.0.9"][et_pb_blurb title="TL:DR" _builder_version="4.0.9" background_color="#0063ff" background_layout="dark" custom_padding="20px|20px|20px|20px|false|false"]

Payment holds are a way payment companies protect themselves.

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Understanding Stripe

We, like many of our competitors, use Stripe and their Connect platform to process payments. There are different types of Connect setups.

Two of the Connect types, Express and Custom, give the integration partner more flexibility in terms of payouts, withholdings, fees, and other payments features.

However, those two Connect platforms also require the integration partner to be responsible for chargebacks and fraud.

This is an important distinction. PushPress does NOT use either of these two setups.

In the eyes of Stripe, any integration partner that implements as Express or Custom Connect, are one single merchant. They see all charges, refunds, and chargebacks as coming from that single source and rely on that single source to manage payouts, refunds, and chargebacks.

This means that integration partner will implement policy to reap the most benefits and to best reduce financial liability and risk for themselves.

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PushPress and some of our competitors use Stripe to process payments.

PushPress uses Stripe Connect Standard, which allows you to connect your business with Stripe directly. It also allows you to manage your relationship with Stripe directly.

Many of our competitors use another form of Stripe Connect that places them as the middleman between your business and Stripe. Your business takes the risk and reward assoicated with the entire relationship between Stripe and your integration.

[/et_pb_blurb][/et_pb_column][/et_pb_row][et_pb_row _builder_version="4.0.9"][et_pb_column type="4_4" _builder_version="4.0.9"][et_pb_cta title="Rock Solid Payments" button_url="https://www.pushpress.com/pricing" button_text="Claim Your Free Account" _builder_version="4.0.9" background_color="#ff3a60" custom_button="on" button_text_color="#ff3a60" button_bg_color="#ffffff" button_border_width="0px" button_use_icon="off"]PushPress Clients enjoy rock solid payments with rates starting at 0.8%START FOR FREE TODAY[/et_pb_cta][/et_pb_column][/et_pb_row][et_pb_row column_structure="3_5,2_5" _builder_version="4.0.9"][et_pb_column type="3_5" _builder_version="4.0.9"][et_pb_text _builder_version="4.0.9"]

Why PushPress Is NOT Subject To Delays as of Today

PushPress has implemented the Standard version of Connect, which means our clients act as standalone merchants.

In todays COVID-19 world this is a huge benefit to our clients because our risk factor is not being evaluated as an aggregate.

PushPress has designed our system to not allow a handful of bad actors to affect the goodwill and operational viability of all other clients. We also believe our clients should always own their own data.

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PushPress clients own their relationship with Stripe. They will be subject to holds and risk associated with your business only.

In general this means PushPress clients risk profile will not be elevated to a additional hold delays, unless they have taken actions that deserve it.

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First Billing Deposit Is Always Held 7 - 10 Business Days

Stripe has a policy to hold the first billing you do for 7 - 10 business days. During this time they do two things:

  1. They do further background checks, which are only kicked off once you take your first payment.
  2. They evaluate your business and chargeback potential.

Once you get your first payment released, you will fall into your normal payout schedule.

 

[/et_pb_text][et_pb_cta title="Support Time Measured In Minutes" button_url="https://www.pushpress.com/pricing" button_text="Claim Your Free Account" _builder_version="4.0.9" background_color="#ff3a60" custom_button="on" button_text_color="#ff3a60" button_bg_color="#ffffff" button_border_width="0px" button_use_icon="off"]Our Customer Success team owns gyms and studios like you.They understand what running a gym is like.START FOR FREE TODAY[/et_pb_cta][/et_pb_column][/et_pb_row][/et_pb_section]

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