While current accounts are the most popular option for most businesses, in certain industries Escrow accounts are an ideal fit to manage money transfers.
Some of these industries are:
1) Co-lending – Where more than one NBFC / business entity have to park the money together in one bank account for loan disbursals to end borrowers
2) P2P Lending (Peer to Peer Lending) – Where multiple people park the money together in one account (owned by the P2P lending platform) for loan disbursals to end borrowers
3) Gaming – Where the gaming company receives platform fee from players in their bank account but 50-70% of this money is earmarked for the winning disbursals
4) Marketplaces / eCommerce – Where the marketplace / eCommerce merchant receives rent money, utility bill payments, payments for goods listed on their website into their bank account, before it is transferred to landlords, sellers, etc.
If you notice carefully, there’s ONE common theme in all the above industries / use cases – merchant is the only one legal owner of the bank account in which the funds are being received or parked (for further disbursals). But the reality is – the actual ownership of the money is split between the merchant and the end beneficiaries (landlord, sellers, winners, or anyone else). It is this legal ambiguity in money ownership that makes digital businesses in these industries vulnerable to compliance risks, penalties and tax troubles.
More & more businesses operating in the above & many other related industries are now embracing Escrow Accounts to remove this ambiguity in money ownership, bring in 100% legal transparency & compliance into these complicated money transfer processes.
This is where Escrow+ by RazorpayX comes in
Escrow+ by RazorpayX has been a forerunner in enabling these digital-first businesses with a unified solution that brings together banks, Escrow trustees and sophisticated banking technology under one roof for automated & hassle-free money transfers from Escrow accounts.
With Escrow+, we help merchants streamline processes & automate money transfers between the bank, the trustee & the RazorpayX platform, ensure compliance, calculate tax more effectively and do all of this with payouts efficiency & success rates that are unheard of in the industry.
This gives merchants an almost hands-off convenience of managing money transfers & compliance so they can focus on their business rather than day-to-day money transfer operations.
Besides getting everything that is included in a basic Escrow account, merchants get an Escrow solution that is supercharged with RazorpayX’s business banking tech-stack along with the stupendous payouts performance, which is a fundamental requirement for all digital-first businesses managing money transfers at scale.
This RazorpayX powered Escrow account solution is offered in partnership with Axis Trusteeship Services Ltd, RBL Bank & ICICI Bank.
Key benefits for Escrow+
– Zero-stress compliance – With Escrow+, merchants don’t have to worry about a thing. They can work with an Escrow trustee – vetted & onboarded by RazorpayX team on their behalf. Managing day-to-operations with the trustee is made super easy with automated processes.
RazorpayX’s partnership with Axis Trusteeship Services Ltd. plays a critical role in helping us deliver seamless experience for our customers. Axis Trustee is one of the most trusted and institution backed Trusteeship service provider in the industry currently catering to more than 600 corporates/FIs with a wide suite of product & services with a special focus on Tech led offerings.
Talking about Axis Trustee’s partnership with RazorpayX for the Escrow solution, Deepa Rath, Managing Director & CEO at Axis Trustee Services Ltd. said, “The future of Banking lies in digital-first solutions, and we are thrilled to announce our partnership with RazorpayX. Together, we are not only committed to ensuring compliance for our customers but also offering a seamless end-to-end money transfer automation directly from Escrow accounts. Together with RazorpayX’s cutting-edge technology and Axis Trustee’s domain expertise, customers can now expect a superior experience that sets a new standard in the Banking & Trustee industry.”
– Pay for ONLY what’s due – Merchants can route all funds that they are receiving on the behalf of end beneficiaries through an Escrow account, instead of receiving funds that do not belong to them in their Current Account – helping them calculate taxes only on their earnings, and not on money flow.
– Automated Escrow solution with X-factor – We automate collections & disbursals from the Escrow Account & give merchants great payout performance with remarkable success rates, much less pending payouts than traditional banks, automated reconciliations & much more.
After empowering thousands of businesses with RazorpayX’s business banking suite on current accounts, we are now all set to extend the automation, ease and robustness of our business banking suite to Escrow accounts as well.
RazorpayX Escrow+ is perfect for digital-first businesses in specific industries like co-lending, gaming, marketplaces / eCommerce & P2P lending where the current account is not an ideal solution for money transfers. Want to know more about RazorpayX Escrow+? Write to us at escrow-rzpx@razorpay.com and we will get back to you in less than 24 hours.
