Marketplace payment solutions compared: who holds the money, and for how long
A marketplace payment solution has one job that a plain payment gateway does not: take the buyer’s money, keep it somewhere while the seller delivers, then split it and pay out. Every provider below does that, but they differ on where the money sits in the meantime, how long it can sit there, who has to pass identity checks, and who eats a chargeback. This is a plain comparison of the options a platform usually shortlists, with the numbers taken from each provider’s own pages, and a note on where escrow held by a smart contract fits.
What you are actually choosing
Four questions separate these providers. Where do funds sit between payment and payout: in your balance, in a provider wallet, or in a contract neither of you controls? How long can they sit there before the provider pays the seller anyway? What does a seller have to do before they can be paid? And when a buyer disputes, who is on the hook?
Fees matter, but they are the easiest thing to compare and the least likely to decide it. Most platforms end up choosing on the hold rules and the onboarding burden.
Stripe Connect
Stripe’s own documentation says it does not provide escrow services or support escrow accounts. What a platform gets instead is control over timing: with separate charges and transfers the buyer pays your platform and you transfer the seller’s share later, and with manual payouts funds can wait in a connected account’s balance for up to 90 days in most countries, two years in the US and 10 days in Thailand. Stripe advises holding funds only for a clear purpose, with a commitment to release them when an event happens, and with legal advice.
The money stays inside Stripe balances and the card networks still apply: cardholders can typically dispute within 120 days, and with most charge types your platform balance is debited for a dispute. Sellers are onboarded as connected accounts and verified by Stripe. We covered the detail in our Stripe escrow post.
PayPal multiparty (Commerce Platform)
PayPal’s multiparty solution lets a platform onboard sellers, take a partner fee on each transaction and pay out. Its delayed-disbursement feature is the closest thing to a hold: the platform can hold a buyer’s funds before disbursing them to the seller, which PayPal describes as time to do additional vetting. The limit is firm: funds are automatically disbursed to the seller after 28 days, and PayPal deducts its fees from the seller’s funds. Sellers must be onboarded with the delayed-disbursement feature first.
Partner fees have to be in the same currency as the transaction and settle once a day. Disputes and chargebacks are managed through PayPal’s own process.
Mangopay
Mangopay is built around e-wallets. Its guide says the wallets hold funds inside the Mangopay environment, each attached to one user in one currency, and that funds can then be moved wallet to wallet so you can take fees, split funds between users and convert currencies. A marketplace typically leaves the buyer’s payment in a wallet until delivery and transfers it to the seller afterwards; there is no stated maximum hold.
To get money from a wallet to a bank account a user has to make a payout, and Mangopay says strict anti-money-laundering rules govern that stage, so the user’s identity must be verified first. Pricing is not published: Mangopay says it is tailored to each platform by volume and products, invoiced monthly, with no free tier.
Lemonway
Lemonway is a French payment institution, regulated by the ACPR since 2012, aimed at European marketplaces and crowdfunding platforms. In its C2C marketplace model payments may be held before payout and the platform controls the release, with the funds in Lemonway-managed wallets. A seller will not receive any funds until their KYC has been accepted and a wallet has been created.
Its published starter pricing is concrete: card pay-ins at 1.10% plus €0.25, bank transfer and direct debit at 0.30% plus €0.40, a €5,490 setup fee, €840 a month for support, €0.50 per European payout and €9 international, a €35 chargeback fee, and a monthly identification charge per account. Platforms above about €7 million a year get custom terms.
Adyen for Platforms
Adyen’s platform product lets you onboard sellers, service providers or contractors, have Adyen verify them before paying out, hold funds until payout and set custom settlement and payout times. It is white-labelled end to end and covers dozens of payment methods in 150-plus countries, but payouts are only available in Australia, the EU, the UK and the US. Pricing is by contact with sales, and the product is pitched at larger SaaS platforms and marketplaces rather than a new site with a handful of sellers.
Escrow held by a contract
The providers above all hold the money themselves, under their own rules and their own clock. The alternative for buyers who pay in stablecoins is to let a smart contract hold it. With the Vaultion escrow API your server sends one request per order, with the price in US cents and that order’s seller wallet, and gets back a hosted checkout. The buyer funds escrow from their own wallet in USDC or USDT on Ethereum mainnet, Arbitrum One, Base, BNB Smart Chain, TRON, and Solana, and the payment is locked in the escrow contract: not in your balance, not in a provider wallet and not with Vaultion. When the buyer confirms delivery the seller is paid; if the buyer goes quiet the seller claims after the review period.
There is no seller onboarding and no identity check, because the seller is just a wallet address, and a confirmed crypto payment cannot be charged back, so there is no 120-day tail. Disputes go to a Vaultion reviewer at no charge. That part is not decentralized: you are trusting Vaultion’s reviewers, and a separate guardian can pause a ruling but never redirect funds. The buyer pays the escrow fee, 4% below 500 USDC, 3% from 500 and 2% from 5,000, and the minimum order is $50. There is no account and no API key, but also no sandbox and no webhooks yet: you poll the session for its status. Your platform’s own commission is not taken inside the escrow; you charge it the way you already do.
Side by side
Where the money waits: Stripe, your platform’s or the seller’s Stripe balance. PayPal, the platform’s PayPal account. Mangopay and Lemonway, a provider-managed wallet. Adyen, a balance account inside Adyen. Vaultion, a smart contract on chain.
How long it can wait: Stripe, up to 90 days in most countries and two years in the US with manual payouts. PayPal, 28 days, then it pays the seller. Mangopay, Lemonway and Adyen, no stated maximum. Vaultion, until the buyer releases or the review period you set ends.
What the seller needs first: Stripe, PayPal, Mangopay, Lemonway and Adyen all verify the seller before paying out. Vaultion needs a wallet address.
Chargebacks: card and PayPal payments can be disputed after the fact, and on Stripe the platform is usually debited. A confirmed stablecoin payment cannot be reversed; an escrow dispute is decided before the money moves.
Fees: Lemonway publishes its starter rates. Stripe and PayPal publish standard processing rates with platform fees on top. Mangopay and Adyen quote per platform. Vaultion charges the buyer 2 to 4% of the escrow and nothing to the platform.
Which to use
Card and bank payments in one region with sellers who will pass verification: Stripe Connect or PayPal if you want the fastest start, Lemonway or Mangopay if you want a European institution holding the funds with no hard limit on the hold, Adyen if you are already at the volume where it will talk to you. Buyers who pay in crypto, cross-border deals, high-ticket orders between strangers, or sellers you cannot onboard with documents: escrow held by a contract. Plenty of marketplaces will run a card provider and on-chain escrow side by side.
See it for yourself
Vaultion runs on a published, open-source contract that holds the funds — not Vaultion. You can read it and the locked balance on the block explorer before you send anything.
Frequently asked
Can a marketplace hold a buyer’s payment until delivery?
Yes, within each provider’s rules. Stripe allows delayed transfers and manual payouts for up to 90 days in most countries, PayPal’s delayed disbursement pays the seller after 28 days at most, Mangopay and Lemonway hold funds in wallets with no stated maximum, and on-chain escrow holds them in a smart contract until release or the end of the review period.
Is a marketplace payment solution the same as escrow?
No. Stripe says outright that it does not provide escrow, and the others hold funds as a payment or e-money institution under their own terms. Escrow in the strict sense means a third party, or a contract, holds the funds and releases them only when agreed conditions are met.
Do sellers have to pass KYC before they are paid?
With Stripe, PayPal, Mangopay, Lemonway and Adyen, yes: each verifies the seller before payouts. Lemonway states a seller receives no funds until KYC is accepted. With escrow held by a contract the seller is a wallet address, so there is nothing to verify.
What does on-chain escrow cost a marketplace?
With Vaultion, nothing to the platform. The buyer pays the escrow fee when funding: 4% below 500 USDC, 3% from 500 and 2% from 5,000, on orders of $50 or more.
Escrow your platform never has to hold
One server-side call per order. The buyer’s stablecoins lock in a contract until delivery, then pay that order’s seller. No seller onboarding, no account, no API key.
See marketplace escrow