Payment split: tool distributes the relevant amounts to each seller in a marketplace
Payment splitting is a tool that aims to distribute the payment made by the consumer during a purchase on a marketplace among the various stores and institutions involved in the transaction.
In this way, both shopping and payment processing becomes more practical, which reduces cart abandonment and saves consumers time, among other advantages.
Who's who in the pay split?
In the context in which split payment transactions take place, the:
• Seller is the seller or shopkeeper in a marketplace;
• Marketplace is the virtual mall where several sellers sell products;
• Consumer is one who is researching a product to buy;
• Customer is the consumer who has purchased a product;
• Carrier is the company that delivered the product to the customer's home;
• Payment gateway is the company that manages payments and the split;
• Payment Split is the application that distributes payment to recipients.
Payment split: consumers buy in several stores in a marketplace and the amounts are passed on to each seller
Anyway, now that we know who is who, how would a split work?
Step-by-step operation of a payment split
The feature basically works as follows:
1. A consumer enters a marketplace and buys products from several sellers;
2. However, at the time of finalizing the purchase, the consumer makes a single payment;
3. The split distributes the value between sellers, carrier, gateway and marketplace.
In this way, the payment split transfers the amount paid by the consumer equivalently to the value of purchases for each seller involved. Furthermore, it distributes the gateway commissions as well as the freight amount of the carrier.
Well, but what are the benefits of that?
Advantages of split payment
In fact, this tool provides advantages for both sellers and consumers, note:
Payment split reduces cart abandonment
• The consumer can gather purchases made from several sellers in the same cart;
• Thus, he does not need to redo the checkout and pay each seller individually;
• The consumer makes a single payment, which is distributed to sellers through the split;
• This increases the convenience of shopping and thus reduces shopping cart abandonment ;
• Furthermore, it improves the usability of the marketplace and increases sellers' sales.
In other words, a payment splitting app makes the marketplace more convenient. This also allows consumers to make larger purchases, i.e., with a higher average order value.
