Third-party payment collection: a special guide for marketplaces

In a marketplace, each transaction must be both seamless for the user and compliant with regulatory requirements. Third-party payment collection is at the heart of this balance: an essential lever for securing exchanges between sellers and buyers. But how can you implement it without complicating the experience? Here is a guide to help you structure this management efficiently.

In a marketplace, third-party payment collection refers to the financial intermediary role played by the platform between the buyer and the seller.
During a sale, the transaction takes place in several stages:

1. The buyer makes their payment on the marketplace.
2. The funds are secured in a fiduciary account held by the marketplace.
3. The marketplace verifies the proper execution of the transaction.
4. After the buyer’s withdrawal period, the funds are transferred by the marketplace to the merchant’s account, minus the operator’s commission.
5. Detailed reporting is generated to ensure traceability of flows and facilitate their management.

However, even if this five-step process seems simple and obvious, it involves significant responsibilities for the marketplace in terms of security and compliance.

Two categories of businesses are primarily interested:

• Entrepreneurs who wish to create a new marketplace: must integrate third-party payment collection from the design stage of their project, taking into account technical and regulatory implications.
• E-commerce businesses that wish to evolve towards a marketplace model: must adapt their existing processes and train their teams on new payment management rules.

The proper functioning of a marketplace is primarily based on the trust relationship it maintains with sellers and buyers, whilst ensuring regulatory compliance. Third-party payment collection is essential to this proper functioning, for several reasons:

• Transaction security
• Simplification of payment management
• Regulatory compliance
• User trust

The management of financial flows on behalf of third parties is strictly governed by several regulations, notably:

• The Payment Services Directive (PSD2): imposes strong customer authentication and the security of online transactions.
• The Anti-Money Laundering and Counter-Terrorism Financing (AML-CTF) regulations: require the implementation of identity verification procedures and transaction monitoring.
• The General Data Protection Regulation (GDPR): governs the collection and processing of personal and financial data.

Implementing and respecting these obligations over time is not necessarily within the reach of all companies. Depending on your company’s resources and activities, you have three options for legally collecting third-party payments.

The most complex.
The provision of payment services as a regular professional activity is reserved solely for payment service providers, which are:

• payment institutions,
• electronic money institutions,
• credit institutions (Article L. 521-1 of the Monetary and Financial Code).

To become a payment service provider, you must be approved by the ACPR.
The ACPR (Prudential Control and Resolution Authority) conducts a thorough examination of the balance sheet, equity, control and security systems.
The procedure is lengthy, taking more than three years, and costly, up to one million euros. It needs significant internal resources and requires maintaining substantial equity, implementing specific governance, and regularly reporting to control authorities.

The rarest.
This option is reserved for platforms offering payment methods used within a limited network of acceptors or for the acquisition of a limited range of goods or services.
For example, Blablacar, a platform specialised in carpooling, has benefited from this exemption.
Therefore, it requires demonstrating the offer’s limitation. However, the ACPR has discretion over the exemption criteria.

Exempt companies are then subject to an annual reporting obligation to the ACPR, no later than 30 June each year. This update verifies that the exemption criteria continue to be met and ensures the security of payment methods.

Moreover, the benefit of this solution must be declared to the ACPR once the payment volume (payment volume executed over the last twelve months) or electronic money in circulation exceeds one million euros. The ACPR will decide on maintaining the exemption from authorisation after studying the declaration.

The most accessible and most common.
It allows you to rely on the authorisation and expertise of the selected provider.
For example, the ADEO marketplace and its Leroy Merlin brand manage payments and returns from 5,000 resellers in an agile and secure manner, thanks to Xpollens’ API solutions.
This option brings a huge time-saving, as it avoids the ACPR stage, but also offers other benefits:

• Cost reduction and better profitability
• Delegation of transaction responsibility
• Access to technical and regulatory expertise
• Provision of tools and interfaces already compliant
• Support in daily operations management

Beyond the regulatory framework, which is paramount, other points require the full attention of the company moving towards a marketplace model.

The implementation of third-party payment collection requires evolving your technical infrastructure to combine reliability and efficiency:

• A payin solution for receiving payments.
• A payout solution for redistributing funds to sellers.
• Payment account management tools.
• Strong authentication systems and transaction security.

You must also be concerned with your organisation to:

• Implement identity verification procedures, KYC (Know Your Customer) and KYB (Know Your Business).
• Ensure tracking and traceability of transactions.
• Manage relationships with various stakeholders.
• Maintain regulatory compliance.

As you will have understood, pivoting between payins from buyers and payouts to merchants is a simple principle, but complex to implement. Relieving yourself of technical and regulatory constraints to better focus on your core business will strengthen your chances of success.

Within a marketplace framework, you can use BaaS to integrate payment functionalities directly into your platform.
It thus becomes simpler to manage third-party payment collection, offering functionalities such as:

• payment account management,
• standard or instant transfers,
• standard or B2B SEPA direct debits,
• refunds.

With BaaS and integrated payment, on one hand, you offer customisable payment services perfectly integrated into your journeys, for a seamless user experience. On the other hand, you optimise your processes with simplified financial flow management, as all transactions are centralised in the same place.

APIs (Application Programming Interfaces) play a central role in payment management on marketplaces. They facilitate interaction between the different systems involved:

• The marketplace platform
• The incoming and outgoing payment system
• Banks
• Identity verification systems
• Reporting tools
• …

In the third-party payment collection process for marketplaces, APIs present several advantages:

• Easily integrate payment solutions. This simplifies the integration process and reduces development costs.
• Automate processes related to third-party payment collection, such as payment validation, transfers, and refunds. This saves time and reduces errors.
• Secure transactions by encrypting sensitive data, such as credit card information.

Third-party payment collection represents a strategic element in the development of a marketplace. Its implementation requires a methodical approach taking into account regulatory, technical, and organisational aspects. The most relevant choice for the majority of platforms is to rely on a technically experienced partner already approved by the ACPR, thus allowing focus on business development while ensuring compliance and transaction security.