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Balanced (YC W11) Adds Bank Payments to its P2P Payments Platform (techcrunch.com)
38 points by swohns 1604 days ago | hide | past | web | 20 comments | favorite



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.


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!


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.


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.


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


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?


That scenario is pretty much exactly what Balanced is designed to address. The money goes:

    Buyer's card -> Your Balanced escrow account -> Merchants bank account
                                                 -> Fee to you
We're also faster, e.g. you have access to the money instantly rather than waiting 7 days for it with.


(I'm a Balanced employee)

Hi there,

We use Quora as a way to answer these questions:

- http://www.quora.com/Balanced/How-does-Balanced-compare-agai...

Our customers highlight why they switched from Braintree, Authorize, Stripe etc to Balanced here:

- http://www.quora.com/Balanced/Why-do-you-use-Balanced-for-pa...

One of our many differences is that your charged/acquired funds are available to you SAME DAY (if you've got a Wells Fargo bank account) or NEXT DAY (if you're not a Wells Fargo customer).

Compare to Stripe's 7day rolling reserve or Braintree's 2 day settlement.

Your use case is very common, many companies like SellSimple / Zaarly / etc use us for that reason. Facilitating transactions is our speciality, though not necessarily all that we can do.

Happy to talk more - hop on IRC (irc.freenode.net #balanced).


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...

-- 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.


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...). You should go to Sacramento on March 11th.

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


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


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...

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

http://www.leginfo.ca.gov/cgi-bin/postquery?bill_number=ab_7...


I believe I've read money transmission licenses vary from state-to-state. Do you know of any resources giving more detail on when you need one and how to get one in the various states?


Talk to a lawyer.

Other than that, my white paper is probably your best bet for general information. http://www.thinkcomputer.com/corporate/whitepapers/heldhosta...


Thanks!


Thanks, Aaron!


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.


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...


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


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




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