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I am creating a site in PHP in which I take Credit card info from user and now I want to process that.also some recurring payment. My use case is that I will deduct some money say $100 from user account and escrow them and on confirmation transfer 10% to another account and and remaining 90% to another account. I know about paypal and different payment gateways but I want to make sure what I am doing is right or not.

My understanding is for Escrow I will deduct money from users account and transfer that to my (admin) account and on confirmation I will transfer the other amounts to respective accounts.

Not sure this is the best way or not . Also I see paypal allows you recurring payment, but what about if I only have users credit card info. how can I do that?

I see similar question for escrow but not helpful

Also important to know how my site database will be helpful, will I rely on my db for recurring payments and escrow or some third party?

Community
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3 Answers3

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Holding money in Escrow is not something PayPal (or any merchant account provider) likes you doing.

Instead, with PayPal, you can use their Preapproval API to allow your users to setup profiles so that you can submit payments on their behalf without further approval. This way you don't have to hold any money, but when the time comes to move it around, you can do so using their preapproval key(s).

For recurring payments with credit cards directly you'll need to sign up with Payments Pro w/ Recurring Billing. This will allow you to create profiles from credit card data without the user having a PayPal account.

Drew Angell
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  • Andeli seems like other than escrow paypal provides me everything, and user dont have to create account on paypal in order to process a transaction? –  Feb 02 '14 at 10:34
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    @user1765876: Correct. You can set up a PayPal, send the callback to your site and process as necessary. There's a nice PayPal IPN PHP Class here: https://github.com/Quixotix/PHP-PayPal-IPN - I've used it on multiple occasions (with multiple edits (necessary for use on my sites)). Try it :) – Magictallguy Feb 21 '14 at 18:35
  • @Magictallguy have you tried to deal with escrow somehow? –  Feb 21 '14 at 21:10
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    @user1765876: Nope, I despise escrow services. I live by a "do it properly or don't bloody bother" rule ;) – Magictallguy Feb 21 '14 at 21:17
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For escrow I would recommend using Balanced.

They have a built-in support for Escrow and PHP libraries + tutorials.

It's supposed to be quite easy to set up.

daniil.t
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  • what is the underlying API they are using? that doesn't seems to be recongnozed or have proven references –  Feb 20 '14 at 18:15
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    have you used it once or just refering? –  Feb 20 '14 at 18:25
  • I was looking for an escrow solution for my marketplace and after some research this seemed like the most appropriate solution. So I thought to recommend it to you too. If you find a better solution, do let me know, otherwise please refrain from making snide remarks. – daniil.t Feb 20 '14 at 19:57
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    I am really sorry if you felt like this , The reason I was asking that you USED it because I don't see so much reference on Google for this website, seems like it is a new API. but in any way your help and answer was so helpful . that's why I up voted it. If I find any other solution I will post here :) –  Feb 21 '14 at 11:15
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    Balanced is a VC-backed company. They are legitimate. http://techcrunch.com/2013/04/02/balanced-andreessen-horowitz-collabfund/ – Kyle Feb 22 '14 at 02:54
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    @user1765876 Its a PR6 website.. so i think you can trust it a little bit.. but of course carry on your research.. – Lucky Soni Feb 22 '14 at 23:36
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    reading this january 2017. This url does not work anymore. ah yes see: https://techcrunch.com/2015/03/13/balanced-is-closing-its-marketplace-payment-platform-in-90-days-strikes-transition-deal-with-rival-stripe/ – morksinaanab Feb 03 '17 at 11:46
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If you or the user is uncomfortable with money being charged up front, most payment gateways offers a pre-auth service. Pre Authorisation allows for the placement of cardholder funds on hold for a pre-determined time, giving you the option of completing the transaction at a later date. If not, the money is released back into the credit card after x number of days.

If your gateway/bank charges refund fees, this could save you a bit on transaction costs. On the other hand, keeping money in your account generate interest. So I would recommend the most financially viable option depending on the circumstances.

Chris Gunawardena
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