Paytm Split Settlement

Paytm Split empowers businesses to manage payouts for each order to multiple stakeholders. With each order sent to Paytm for collecting payment, intimate Paytm how much you want to settle to your vendors/partners/various bank accounts. Later, Paytm would make the seamless payouts to them. This way you could focus on growing the business and let Paytm handle the complete money movement.

To receive a payment’s settlement in multiple bank accounts, you must follow the steps below: 

1. Add account 
2. Transaction split operation 
3. Reconciliation

Add account

The first step towards settling a transaction to multiple bank accounts/vendors/sellers is to on-board the accounts on Paytm PG. You can easily onboard one or multiple accounts on Paytm using the Merchant Dashboard. 
Once you onboard the accounts, you’d receive an Account ID for all the added accounts. You need to store these account IDs in your database for each account added. You must pass the Account ID on to Paytm in the split details of the transaction request, along with the amount you want to settle to this account.

You need the following details to onboard an account: 

• Account name 
• Mobile number 
• Email ID
• Account details ( Can’t have multiple vendors with same account details)- It includes the details below:
  • Bank account beneficiary name
  • Bank account number 
  • IFSC code 
  • Bank name 

Note

• All Account IDs will have the same settlement cycle (T+1) as the original business settlement cycle
• You can view/download the account list with Account IDs from the Split Settlement Accounts tab in the dashboard 
• You can change the Bank/Contact details of a vendor using the edit function on the main merchant's dashboard 
• Vendor onboarding is near real-time, but processing large bulk files for onboarding can take up to few minutes in account verification

Transaction Split Operation

Once the accounts/sellers/vendors are onboard, you need to intimate Paytm how much amount you would like to give to which Account ID in the transaction request. Once we’ve successfully processed a transaction with those split details, Paytm would take care of creating separate payouts for all Account IDs and transfer the respective amounts.

You can refer to the flow diagram below for a brief of money flow for split settlement:

Example of Split Settlement

1. Customer goes to the main merchant's website and order goods/services worth Rs.1000. 
2. The merchant provides the following transaction split details:
   • Vendor A: Rs.500 (or 50%) 
   • Vendor B: Rs.200 (or 20%) 
   • Aggregator: Rs. 300 (or 30%)
3. Once the transaction is successful, Paytm debits the fee(Rs.20) and credits Rs.980 into the merchant’s internal balance.
4. Once the money is credited to a merchant’s internal balance, we transfer the respective amounts to the vendor’s internal balance.
5. Balance in each account:
   • Vendor A: Rs.500
   • Vendor B: Rs.200
   • Aggregator: Rs.280
6. At the time of Payout (T+1), all the transactions to the main merchant & vendors are accumulated and they receive a settlement for respective amounts.

Reconciliation

Reconciliation for settlements done to the main merchant/splitting party and vendor can be done using the files sent over the email to the main merchant or by downloading the settlement files from merchant dashboard. The files set over mail have details of the settlement to all vendors in one report, while from the merchant dashboard one can download settlement files for itself and each vendor separately. 

Note

• The commission charged on Payment (Rs.1000) would be from main merchant 
• Currently, all the refunds raised would be deducted from the main merchant’s payout even if the settlement of the original order was split with a couple of vendors
• Settlement cycle for the vendors would be same as main merchant’s settlement cycle 
• If the split amount for all the vendors doesn’t add up to order amount/transaction amount, the residue amount would be settled to main merchant 
• In case of PCF commission mode, the split is applicable on original order amount (Excluding commission paid by the customer)

Marketplaces

Online marketplaces that connect customers to the merchants have to maintain finance operations to settle the price of goods sold to the sellers. Most of the time the customers create a shopping cart with goods from multiple sellers. Then, the payments made by a customer to the marketplace are supposed to be split between the marketplace and those sellers. 

Instead of running operations to recon money settled by Paytm and then paying the sellers, a marketplace can give the split of each seller in a transaction request to Paytm and then Paytm would take care of settling to all sellers and ensure the marketplace is settled only on their revenue share in a bank account.

Multiple bank accounts

Many businesses have to maintain multiple bank accounts for settlement as the payments made by customers are for different parts of the organisation and accounting has to be such. Getting money from payment partners in one account and then spitting internally is not only operationally heavy but prone to error. Paytm Split provides the capability for such organisations to receive payments by customers directly in respective accounts. 

What can you do with Paytm Split?

You can perform the following task using the Paytm Split:

• Add and manage all of your vendors/accounts 
• Split a transaction’s Payout into multiple accounts by amount/percentage split 
• Vendor reconciliation using auto-created vendor settlement files

Split settlement solution is available with all the checkout solutions and its processing steps are as follows:

1. Customer visits your website or mobile application and adds goods into the cart of different vendors/sellers and pays for the amount.
2. You are required to pass the SplitSettlementInfo object in Initiate Transaction API request, with the transaction splitting information such as method, amount etc.
3. Paytm shares a transaction token in response to the Initiate Transaction API request post validation and you will pass the transaction token to your app/browser.
4. You call the Process Transaction API using the same token. Paytm processes the transaction post validating the request and shares the status of the transaction with you. You show the transaction status as received through Paytm.
5. In the case of Custom Checkout flow, call the Process Transaction API after the user has selected the payment option with the split info.