I understand that there needs to be a safety margin and risk hedging but 50% for 9 months is going a bit far.
We are a small recreational property manager in the Netherlands. We switched from Mollie to Stripe earlier this year because our new PMS works exclusively with Stripe. Never had any problems with Mollie in the past.
We charge 20% commission for our services and pay out our owners on check-out date every month. Currently we have something over €600k tied up until April 2024. This is money from stays that have already been and we have to pay out to our owners.
What are your experiences with percentages withheld and the length of it? How do these decisions come about, what data points do they use? Are they able to analyze at all on a case-by-case basis?
Is there a change of getting this amount payed or are we f*cked?
A quick google brings up paddle, is that going to have the same issues?
Learnings: “Rolling Reserves” : the safety margin on non-guaranteed payment methods such as credit card, this margin is released after X days.
Mollie says all PSPs, especially after Corona, keep a rolling reserve with customers active in Travel / Hospitality.
Mollie standard is 20% for 90 days.
With additional info (financial report two year record with balance sheet, P&L, CF statement and org chart) they’ll look at lowering this to 15 or 10%.
No answer from Stripe on their take and no relieve. They asked for latest financial statement but told me they do not go into their arguments or structure.
We are building our own booking engine and need to make choices about a payment provider. Yes, we're considering Mollie again. For this, we would have to build everything outside of our PMS, which in turn lowers the added value of our expensive PMS.
The development in "open banking" software is also interesting. As I understand it now, this could potentially eliminate Stripe as a middleman. Is this already a viable alternative? Any suggestions?
As for risk management, I could imagine that, in addition to macro numbers and global averages, you would also look at specific situations.
In our case, I could demonstrate that we have existed for multiple years with positive figures, payment terms for guests are 20% at the time of booking and 80% two weeks before arrival, the average processing time is 3 months, and we can add metadata to track things for control purposes.
Currently, we already have €600k tied up, but if you had warned during onboarding that we were in a risk group based on macro figures, I would have been happy to provide additional information. So don't just let anyone in, but screen at the front door.
Furthermore, I'm wondering to what extent it is Stripe's responsibility to estimate risks and fully cover these for the end user, as opposed to simply transferring funds from A to B. If you wish to do this, guard that front door better, even if it comes at the expense of the lucrative pile of money being held back. But this would be challenging when wanting to serve startups?!
That said, I see your email into our support team and we're taking another look at this now.