Etsy Explains Payment Reserves

Etsy Explains Payment Reserves To Safeguard Its Marketplace

In response to growing inquiries regarding payment reserves, Etsy has released detailed information explaining the significance of this safeguard for its community. As an ecommerce platform, Etsy places a high priority on maintaining a trusted and secure environment for both buyers and sellers.

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Understanding Payment Reserves

When a seller’s payment account has an active reserve, a percentage of their earnings from physical orders will not be immediately available for deposit.

This precautionary measure ensures that sellers can meet customer demands by shipping orders promptly and providing reliable customer service.

The reserved funds are released for deposit once the order has been shipped and is in transit, confirmed through tracking events from the postal carrier.

Analysis reveals that, on average, funds from most orders became available to sellers within two weeks of the order date in 2022.

Reasons for Placing Funds in Reserve

Temporary payment account reserves are established based on various risk factors, including:

  • A sudden surge in order volume.
  • Consistently missing tracking information or events.
  • Failure to ship orders on time.
  • A recent increase in refunds.
  • New shop on the marketplace.

Etsy’s Payments Policy outlines several risk factors that may trigger an account reserve. Reserves can be imposed or removed from a payment account at any time, and a shop may experience multiple reserves if they continue to meet the risk criteria.

To enhance protection against fraudulent account activity, Etsy does not disclose the specific logic or thresholds used to determine reserve placement.

Guidance for Sellers Placed in Reserve

Sellers who find their payment accounts in reserve should check their email for a notification that provides details about the duration and portion of funds that will be temporarily unavailable for deposit. This information can also be found within the payment account itself.

To minimize the likelihood of a payment account reserve, sellers can take the following steps:

  • Whenever possible, provide tracking information that Etsy can verify, enabling the release of held funds as soon as the order is shipped.
  • Ensure timely order fulfillment and consider adjusting processing times if necessary.
  • Only mark orders as complete once they have been handed over to the shipping carrier.
  • Respond promptly to customer messages, aiming to reply within 24 hours if feasible. This responsiveness contributes to achieving Star Seller status, exempting sellers from payment account reserves.
  • Stay informed about seller policies to ensure compliance and the continued operation of the shop.

For further details on payment account reserves, Etsy sellers can visit the Help Center on the platform. Etsy remains committed to fostering a secure and reliable marketplace, where both buyers and sellers can engage with confidence.

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One Comment

  1. Indie Sellers Guild says:

    We are an industry advocacy group from creative small business sellers online and have started a petition for this http://indiesellersguild.org/etsymustpay Now Etsy is offering US sellers cash loans through a 3rd party for sellers with cash flow issues from THEIR reserves policy!

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