What is Escrow and how does it work?
Escrow transactions are financial arrangements where a trusted third party holds and regulates payment of the funds required for two or more parties involved in that transaction. Escrow ensures that transactions are carried out according to the agreed terms and conditions.
Vesicash Escrow makes transactions more secure by keeping the payment in a secure escrow account, from which it is released only when all of the terms of the agreement have been met as stated.
Use Cases of Escrow
- Escrows are very useful in the case of a transaction where a large amount of money is involved and a certain number of obligations need to be fulfilled before a payment is released, such as in the case of a website being built, where the Buyer might want confirmation of the quality of work being done before making a full/partial payment, and the software developer doesn’t want to deliver a ton of work without any payment assurance. While traditional escrow services are quite difficult and must be obtained through banks and lawyers, Vesicash provides instant digital escrow services at affordable rates.
- Escrows are very useful when you are buying or selling goods/services from someone you barely know. Vesicash escrow ensures you are transacting with verified people at all times.
Who is Escrow For?
- Do you run an online business that sells on Instagram, Facebook or Twitter? 90% of the time, you are dealing with unserious buyers. 65% of the people that come across products on these channels fail to buy because they are afraid of being defrauded. Different kinds of fraud on these platforms include: payment not being made for items sold or items not delivered for payment made. The risk for Sellers is in not receiving payment for items they’ve shipped, or most times dealing with unserious Buyers which means as a Seller, you would have shipped out items, including the delivery fee and you get nothing in return. Escrow reduces this risk for you as a business because at all times, you are dealing with Buyers who have made a financial commitment before you ship out the item. You never have to worry about chargebacks because the money is safely ‘in Escrow’. If you have to issue refunds or returns, Escrow makes it easier to give refunds without making your Buyers or Clients wait for days. Escrow eliminates your exposure to fraud.
- As a Buyer, your payment security is ensured with escrow. The Seller does not get your payment until you see and confirm your satisfaction with what you paid for.
How Does Vesicash Escrow work?
There are always two or more parties involved in a transaction, but the two most important parties are the Buyer and the Seller.
Buyer – A Buyer is the person paying for goods or services.
Seller – A Seller is the person providing goods or services for sale.
- Buyer or Seller creates an escrow transaction where they set the terms and conditions for the transaction. This is called the contract phase. The terms of this transaction are the conditions that dictate how funds should be released from escrow.
- Buyer pays for the transaction and the funds are securely held in Vesicash Escrow.
- Once the Seller has delivered the goods or service, he or she confirms the delivery.
- The Inspection Period is opened and the buyer is expected to confirm their satisfaction or open a dispute within this period.
- After the Buyer confirms their satisfaction, the payment is disbursed from the escrow to the Seller.
PS: The Seller is not paid until the Buyer accepts and confirms delivery of the items/service or the inspection period has expired.
What kinds of Escrow transaction can I create with Vesicash Escrow?
- One-off escrow transaction – These are transactions where the payment is to be disbursed from the escrow account once the terms of the agreement have been met. Example buying and selling of a Merchandise.
- Milestone escrow transaction – These transactions are broken down into different stages/phases called Milestones. For every milestone, there are different agreements attached to each payment for each phase and the payment for each milestone is disbursed from escrow once the terms of each milestone have been met. A typical use case is software development.
Payment Options on Vesicash
Vesicash offers different kinds of payment options ranging from Debit/Credit card payment, to USSD, Bank Transfer or Cash deposit. Vesicash ensures payment for your escrow transactions are safe and secure.
Advantages of Vesicash Escrow
As the leading provider of online escrow services in Nigeria, Vesicash provides a host of advantages for its users, such as:
- Vesicash ensures that all buyers and sellers are protected equally and disputes are resolved amicably.
- Vesicash employs a layered identity verification process for the parties transacting on the platform, so you can be sure you are dealing with a verified person.
- Vesicash verifies the funds sent by the buyer and keeps them in our secure trust escrow account for the seller.
- The seller ships the product only after the buyer has made complete payment to Vesicash.
- The seller is not paid until the buyer accepts the product and has the chance to fully inspect it. After the buyer inspects and accepts the product, the funds will be moved from our escrow account to the seller’s account.
- With Vesicash serving as your escrow partner protecting your transaction, you can rest assured that your funds are in safe hands, free from fraud.
Using the Vesicash Escrow service to buy and sell products, services and more is the most convenient way to complete transactions online. Facilitated by a trusted third-party, the escrow process acts as your personal tool to ensure a safe, secure and intuitive sale for both Buyers and Sellers.