WorldPay supports multiple types of Settlement creation. There is Advanced Settlement, Managed Settlement, and Dynamic Payout. Advanced Settlements provides funding instructions for your merchant, the next business day. Managed Settlements provides a framework to pay out merchants according to a set of specific rules automatically. Dynamic Payouts allows the Payment Facilitator to send instructions and control how payouts happen.
Finix Payments uses Dynamic Payouts model to pay your merchants, debit, credit the FBO, and send revenue collected to your Operating Account. Worldpay generates daily operational and reconciliation reports, providing a closed-loop transaction life-cycle from payment to sub-merchant payout, avoiding the need for the Payment Facilitator to manage the funds themselves.
For Benefit Of (FBO) Account
In the case of a Dynamic Payout scenario, Payment Facilitators will board sub-merchants and submit transactions normally. Funds from settled transactions accumulate in an FBO account (“for the benefit of”). In this case, the Payment Facilitator takes the responsibility of distributing funds to sub-merchants (and to themselves) by submitting a batch file containing funds transfer instructions.
Finix handles the Dynamic Payouts scenario in the FBO account through the use of Settlements.
A Settlement is a logical construct representing a collection (i.e. batch) of Transfers that are intended to be paid out to a specific Merchant.
Each Settlement is comprised of all the Transfers that have a SUCCEEDED state and that have not been previously settled out. In other words, if a merchant has a Transfer in the PENDING state it will not be included in the batch settlement. In addition, Settlements will include any refunded Transfers as a deduction. The total_amount minus the total_fee equals the net_amount (the amount in cents that will be deposited into your merchant’s bank account).