Payment Service Provider features (PSP)

Connects payment providers to the marketplace

• Why

• Which context

• Interfaces

• Configurations

• Workflows

  • KYC/KYB management and validation process

• Special rules

  • Which PSP should I choose?

    • Geographical choice

    • Functional choice

    • Expertise & Price Choice

    • Overview of PSPs available on Second and features

  • KYC/KYB process

Why

Marketplaces & traditional e-commerces differ in that in marketplaces, three parties are involved (vendor, buyer and platform operator) whereas in traditional e-commerces, two parties are involved (vendor/operator and buyer).

A payment service provider (PSP) or payment gateway hence becomes essential to bring payment solutions on marketplaces.

PSPs are used for:

• accepting electronic payments thourgh different payment methods

  • credit card

  • bank-based payments

    • direct debit

    • traditional wire transfer

    • real-time wire transfer

PSPs workflows are adapted to match marketplace-specific requirements:

• Secure recollection of funds & escrowing (secure delayed payment)

• Fraud management, KYC (Know Your Customers) & KYB (Know Your Business Procedures)

• Askers & offerors security and trust

Various PSPs can be used to perform transactions on marketplaces.

Which context

For all services.

Interfaces

Learn more on interfaces here:

• Stripe (PSP) - Business rules

• Mangopay (PSP) - Business rules

Configurations

Learn more on how to configure the bundle here:

• SBO > Other > Feature > Stripe

• SBO > Other > Feature > Payment Methods

Workflows

Workflows are identical throughout the 3 PSPs Second offers:

KYC/KYB management and validation process

The primary objective of the marketplace is to enhance user registration and increase the number of bookings. To streamline the booking process on the platform, Know Your Customer (KYC) verification is required only when a vendor wishes to accept a booking.

Customers can navigate the platform, search for listings, and make booking requests without undergoing KYC verification. This allows for an uninterrupted and user-friendly experience, encouraging more interaction with the marketplace.

Vendors, on the other hand, can easily create listings without initial verification. However, when a vendor decides to accept a booking request, they must complete the KYC validation process. The specifics of the KYC validation are determined by the payment service provider configured within the platform.

This approach ensures that while customers enjoy a seamless experience, necessary security and verification standards are upheld for vendors. By implementing this method, the marketplace maintains a balance between user convenience and security requirements.

Special rules

Which PSP should I choose?

There are different criteria to take into account when choosing which PSP to integrate. We can classify them into 3 main categories:

• Geographical

• Functional

• Expertise & Price.

Geographical choice

Geographically, it is key to check if the PSP can:

• Operate in the countries where the marketplace will be hosting its activities

• Comply with the laws of the concerned countries.

For example, is my customer's company on the list of countries allowed by the PSP?

Does the PSP accept bidders from “country”?

Functional choice

Functionally, one should verify if the features offered by the PSP covers:

• The types of payment workflow (escrow, direct payment etc..)

• The different payment methods (credit card, transfer, etc.)

• KYC/KYB management

• The functionalities offered by the PSP dashboard

Expertise & Price choice

The last criteria is the expertise & price of the PSP. While price is a fairly straight forward criteria, it usually scales with the following services:

• The number of customers

• The type of customers

• The support provided

Overview of PSPs available on Second and features

PSP name	Geographical criteria	Functionnalities
Mangopay	Operator located in the EU Users must be on a specific list of countries (here)	Payment workflow: Marketplace (escrow) Integrated payment: Credit card, Bank wire KYC/KYB management
Stripe	Operator located in Stripe authorized countries (here) Offeror must be located in Stripe authorized countries (here)	Payment workflow: Marketplace (90 Days escrow) Integrated payment: Credit card KYC/KYB management
Lemonway	Operator must be located in Lemonway authorized countries (29 countries) Offeror and asker must be located in Lemonway authorized countries	Payment workflow: Marketplace (escrow) Integrated payment: Credit card, Bank wire KYC/KYB management

KYC/KYB process

KYC, or Know Your Customer, and KYB, or Know Your Business, are processes required to verify the identity of customers as per legal requirements and regulations. These processes are carried out by authorized companies, which usually are the PSPs. Marketplaces are however under the obligation of respecting this process before allowing users to receive payments.

These processes applies to:

• All users who require the PSP’s services

• Individuals or legal entities

• Both askers and offerers

To benefit from the services provided by a PSP, users need to provide a certain amount of information.

Offerors provide :

• Identity information about the individual opening the account

• Company identity information if the account is registered as a legal entity

The KYC / KYB being a list of information concerning platform users, the required information may differ according to certain identity criteria such as:

• Business type (individual or enterprise)

• Business structure (private company, association etc...)

• User country

The PSP-specific KYB/KYC processes are described the related PSP documentation.