What is delayed payout in marketplaces?

Delayed payouts mean that the funds are held and not released to the seller before agreed-upon conditions are met. These conditions can be a predetermined date or the completion of an order. Delayed payments resemble escrow, which is a legal, contractual arrangement for holding funds. Delaying payouts is heavily regulated, and not all payment service providers offer delayed payouts or escrow. At the same time, being able to delay payouts is important for a marketplace because it helps build trust between customers and providers.

In a transaction flow with delayed payouts, the customer initiates a payment, and the funds are held by the marketplace's payment service provider. The seller does not receive the money outright. When the conditions for a payout are realized, the payout is made, and the seller receives the payment.

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• What is matching in marketplaces?
• What is a marketplace transaction flow?
• What is a marketplace payment service provider or payment gateway?
• What are split payments in a marketplace?