

Balanced (YC W11) Adds Bank Payments to its P2P Payments Platform - swohns
http://techcrunch.com/2013/02/28/balanced-bank-payments/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29

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goodwink
This is very nearly the "Stripe, but also with ACH" that I've been wanting for
a while now. Being able to let businesses set up recurring ACH debit for
subscription plans is very good for the B2B SaaS market.

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mjallday
Don't forget escrow. For anyone that's taking money from one party, taking a
cut and then sending the remainder to someone else, escrow is a very handy
feature!

~~~
wheaties
So do these bank to bank transfers allow escrowing funds? If so, the hits keep
coming. I'm amazingly impressed not only with their customer service but ease
of use settings things up.

~~~
mjallday
Yes, you charge a card or debit a bank account and the funds flow into your
escrow account within Balanced. From there you can credit it out to bank
accounts.

Funds for credit cards are available to use 2 days faster than any other
competitor (that i'm aware of) e.g. instantly and bank account debits take a
couple of business days to clear since we're utilizing the ACH network
underneath.

~~~
goodwink
I think my next project may well use balanced instead of stripe. This is great
stuff!

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siculars
First I'm hearing of Balanced. This news aside, how is Balanced different from
Stripe?

If I had a p2p trading application (like craigslist) where the Buyer and the
Seller wanted to transfer funds for services rendered or goods delivered,
could Balanced facilitate such a transaction with the money going to me as an
intermediary? Possibly even maintaining anonymity between the two parties?

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cristinacordova
Cristina from Stripe here. Stripe Connect is the product most of our platforms
and marketplaces use: <https://stripe.com/connect>

Amber on our team clarified some of the differences between Stripe and
Balanced here: [http://www.quora.com/Balanced/How-does-Balanced-compare-
agai...](http://www.quora.com/Balanced/How-does-Balanced-compare-against-
Stripe/answer/Amber-Feng)

\-- Flow of Funds --

With Balanced, since all of the payments are aggregated in one account, it’s
up to the marketplace to keep track of how much each seller is owed and
explicitly pay them out. This means full control on exactly when and what gets
paid: things like escrow and custom payout schedules are possible.

With Stripe Connect, since all of the sellers have different Stripe accounts
and the charges are made with their distinct API keys, the money will
automatically go into their Stripe account and be paid out a 7-day rolling
basis. The application can take a cut of each transaction and/or issue
refunds, but you never have to touch (or worry about) distributing any of the
funds. Because of this, however, payout schedules are less flexible.

\-- Liability/Disputes --

Balanced provides the ability to pass disputes onto the seller, but the
marketplace ultimately has full liability for chargebacks, fraud, and so on.

With Stripe Connect, each seller is responsible for charges run through their
own Stripe account. This removes any liability from the marketplace, and is
really useful if you want to purely be a platform of facilitating payments and
don’t actually want to be involved in the risk and complexity of handling any
of the money.

\-- Signing up a seller --

With Balanced, each seller can be signed up directly through the API (which
includes an underwriting API). However, any charges made are still the
responsibility of the marketplace.

With Stripe Connect, the seller can use an existing Stripe account or create a
new one during the OAuth flow (which requires a redirect to Stripe’s site).
Stripe takes full responsibility for evaluating each seller.

For the application you mentioned, Stripe Connect can certainly facilitate a
transaction like that. With Balanced, if something goes wrong with the
transaction, the marketplace is liable for disputes. With Stripe, because the
transaction is happening directly between the buyer and seller, the
marketplace avoids all liability.

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pulledpork
I'm not sold on the name Bank Payments. I can pay many things at a bank.

In (financial) layman a terms this is ACH credits and debits.

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jareau
Thanks for the input. I tried to figure out a better name with the developer
community, but couldn't come to anything we liked. Would you mind chiming in
with your thoughts on our github issue: [https://github.com/balanced/balanced-
api/issues/2#issuecomme...](https://github.com/balanced/balanced-
api/issues/2#issuecomment-13925701)

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thinkcomp
It looks like a great product, but I'm pretty sure you don't have and have not
applied for a money transmission license (at least according to
[http://www.dfi.ca.gov/Publications/summaries/2013/January.pd...](http://www.dfi.ca.gov/Publications/summaries/2013/January.pdf)).
You should go to Sacramento on March 11th.

<http://abnk.assembly.ca.gov/hearings>

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flynnwynn
Are you saying this service is illegal without the money transmission license?

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thinkcomp
Yes I am--not to pick on them though. They are one startup of many and if
everyone pretends it's not an issue then the law will never get fixed.

[http://www.leginfo.ca.gov/cgi-
bin/displaycode?section=fin...](http://www.leginfo.ca.gov/cgi-
bin/displaycode?section=fin&group=01001-02000&file=2000-2003)

Assembly Bill 786 is about to make it a lot worse.

[http://www.leginfo.ca.gov/cgi-
bin/postquery?bill_number=ab_7...](http://www.leginfo.ca.gov/cgi-
bin/postquery?bill_number=ab_786&sess=CUR&house=B&author=dickinson)

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rbn
Expand internationally. I'm willing to put up with PayPal because I can accept
sellers from around the world.

~~~
jareau
We'd like to expand outside of the US as well. We're discussing that topic
here. Please let us know what you think:
<https://github.com/balanced/balanced-api/issues/23>

