Remittance of Funds
  • Updated on 17 Jun 2020
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Remittance of Funds

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the Remittance Payer remits funds to the operational bank account of the Settlement Manager, i.e. funds have been transferred out of the Remittance Payer’s account to the settlement manager's operational account.

When the method of payment is EasyPay the funds are not remitted by the Remittance Payer but by the EasyPay Provider. Therefore, transactions with payment method EasyPay are not included in the Remittance Transfer Notification.

1. Requests for Clearance where payment is split between two payment methods

Customer has purchased a service and paid the full amount to the Seller. The Seller is unable to request creation of the order with Cash as the only payment method. For example, the Seller has exhausted the limit of its Remittance Holding Capacity. ORA has agreed that the Seller remits the funds to ORA using payment methods Cash and EasyPay.

a) Preconditions

Seller has operational EasyPay Wallet. ORA has received AuthorisationID for the EasyPay payment. There are no commissions associated with the sale. Transactional and clearance currencies are the same. Settlement Manager operates daily Clearance in this market. The Seller has requested to receive ClearanceNotif message with one Clearance per ClearanceNotif message.

b) SwO Process

  • Because payment is completed with two methods of payment there are two PaymentID and therefore two CommitmentID for the same Agreement ID, which is the Order ID in this case. Consequently, ORA sends two Clearances in the ClearanceRQ message to the Settlement Manager that are associated with this payment.
  • The Settlement Manager acknowledges the receipt of the ClearanceRQ message with a ClearanceRS message. The ClearanceRS message is structured as the ClearanceRQ message, has no errors and the Clearance Status Code for the two Clearances related to this payment have value “Accepted”. Both Clearances include the Settlement Date “SD”. For the Clearance with Payment Method Cash the Settlement Date “SD” is as per SwO Calendar. The same applies for the Clearance with Payment Method EasyPay.
  • Settlement Manager sends ClearanceNotif messages to the Seller only for the Clearance where the payment method is Cash with Remittance Date “RD” as per SwO Schedule.
  • The Settlement Manager requests transfer of funds from the EasyPay vendor providing identification for the Payer and the AuthorizationID for the EasyPay payment.
  • Following the SwO Schedule on Remittance Transfer Notification Delivery Deadline Date the Settlement Manager sends the RemittanceTransferNotif message to the Remittance Payer. The RemittanceTransferNotif message is identified with its RemitID and includes the Total Amount that must be remitted by the Remittance Payer (or the Seller) and the list of Clearances that have been aggregated for this Remittance Transfer Notification. The Clearance with method of payment Cash is included in this RemittanceTransferNotif message.
  • The Settlement Manager receives the funds from the EasyPay vendor.
  • On Remittance Date the Remittance Payer orders payment to the Settlement Manager’s bank account for funds equivalent to the Total Amount in the RemittanceTransferNotif message identified with its RemitID. The Remit ID is included in the remarks of the bank transfer order. Funds are received by the Settlement Manager on the same day.
  • On Settlement Date the Settlement Manger sends SettlementTransferNotif message that is identified with its SettleID. The SettlementTransferNotif message includes the Total Amount being settled to ORA (or Settlement Payee) and the list of Clearances that have been aggregated for this SettlementTransferNotif. The Clearances with payment method EasyPay and Cash are both included in the SettlementTransferNotif message, each one identified with its own ClearanceID. The Settlement Manager also orders bank transfer to the ORA bank account for the Total Amount in the SettlementTransferNotif message and includes in the remarks the SettleID.

2. Remittance not full

On Remittance Date “RD” the Seller remits only 75% of the “Total Amount” value for the respective RemittanceTransferNotif message, which is identified with its Remit ID.

a) Preconditions

Settlement Manager’s operational bank account does not have credit line. The Settlement Manager applies the available funds from the Remittance Payer proportionally to each Settlement Payee expecting funds form the Remittance Payer. For each Settlement Payee the Settlement Manager processes its transactions on “first in first out” (FIFO) basis. This example is for sales from Orders only.

b) SwO Process

  • The Settlement Manager receives payment identified with RemitID 7531. The payment is only for 75% of the “Total Amount” value in the RemittanceTransferNotif with the same RemitID.
  • Settlement Manager identifies that Payees: ABC, XYZ and LMN have been affected by the short payment from Payer TRVL.
  • The Settlement Manager identifies that there are 537 Clearance between ABC and TRVL. 75% of their value represents enough funds to pay the oldest 477 individual transaction and partially transaction 478. The remaining transactions are not settled.
  • The Settlement Manager sends SettlementTransferNotif message with Settle ID 98765 to ABC. The last 59 transactions that were supposed to be settled with this Settlement Transfer Notification but could not due to short payment are included in the SettlementTransferNotif message with Clearance Status Code equal to “Not Settled”. The transaction immediately after the last settled transaction is included in the SettlementTransferNotif message with Clearance Status Code equal to “1-Partially Settled” indicating the amount being settled in the data element “Net Clearance Amount” and the amount not yet settled in the data element “Remaining Amount”. The value of the data element “Total Amount” in the SettlementTransferNotif is the sum of the values of the data element “Net Clearance Amount” for all transactions with Clearance Status Code equal to “Fully Settled” and “Partially Settled”.
  • The Settlement Manager processes the Clearances between TRVL and XYZ and TRVL and LMN in the same manner as described for ABC above.
  • Seller is given 24 hours to pay the missing funds.
  • The next day Seller pays the remaining 25% in full.
  • The Settlement Manager includes the paid Clearances identified by their ClearanceID in the next SettlementTransferNotif message with Settle ID 98767. The value of the data element “Total Amount” of SettlementTransferNotif message with Settle ID 98767 includes the 25% of the not settled amount from SettlementTransferNotif message with Settle ID 98765. The 59 transactions that were not included in SettlementTransferNotif message with Settle ID 98765 have been added to the SettlementTransferNotif message with Settle ID 98767 with Clearance Status Code equal to “Final Settlement”.

3. Remittance not full with clawback following the settlement.

On Remittance Date “RD” the Remittance Payer remits funds that are 90% of the expected “Total Amount” value for the respective RemittanceTransferNotif message identified by its Remit ID. Regardless of the short payment by the Remittance Payer, the Settlement Manager sends SettlementTransferNotif messages to the concerned Settlement Payees that show all Clearances as 100% settled. The Settlement Manager transfers 100% of the funds that the Settlement Payees expect to receive as indicated in the corresponding SettlementTransferNotif messages.

a) Preconditions

Settlement Manager’s operational bank account has credit line. The Settlement Manager pays Settlement Payees 100% of Total Amounts to be settled on the settlement day. The Settlement Manager retrieves money from Settlement Payees in the next available settlement period, after the seller’s status becomes “defaulted”. For each Settlement Payee the Settlement Manager “claws back” the full amount that has been paid since the first period of default of the Seller. The value of the data element “Total Amount” in the following SettlementTransferNotif message is higher than the total amount of the funds with Settlement Code “Claw Back”, otherwise RemittanceTransferNotif messages must be sent to the original Settlement Payee. This example is for sales from Orders only.

b) SwO Process

  • The Settlement Manager receives payment identified with ID 91287. The payment is only for 90% of the “Total Amount” value in the RemittanceTransferNotif with the same RemitID.
  • Regardless of the short payment on Settlement Date “SD” the Settlement Manger sends SettlementTransferNotif where the value of the data element “Total Amount” is 100% of what is expected. The Settlement Manager also orders bank transfer to the Settlement Payee’s bank account for an amount equal to the value of the data element “Total Amount” in the SettlementTransferNotif.
  • The Settlement Manager cannot collect the 10% and therefore must recover the funds that have been previously paid to the Settlement Payee.
  • The Settlement Manager identifies that Settlement Payees: ABC, XYZ and LMN have been affected by the short payment from Payer TRVL. The Settlement Manager must recover 100% of the funds paid to each one of the Settlement Payees.
  • The Settlement Manager adds all impacted Clearances identified by their ClearanceID to the next SettlementTransferNotif message. The Clearance Status Code for each is set to “Claw Back”. The SettlementTransferNotif message with its Settle ID (Settle ID 87675) is sent to ABC. The Settlement Manager also orders bank transfer to ABC’s bank account for funds equivalent to the value of the data element “Total Amount” in the SettlementTransferNotif message with SettleID 87675 and includes the Settle ID in the remarks of the bank transfer order. When calculating the value of the data element “Total Amount” in SettlementTransferNotif with SettleID 87675 is calculated the Clearances with Clearance Status Code equal to “Claw Back” are added after being multiplied by -1.
  • Settlement Manage repeats the same steps for Payees XYZ and LMN. The number of individual transactions from the original Clearance for each Settlement Payee will be different.

Note: When the Settlement Manager collects the unpaid amount form Seller TRVL then the Settlement Manager would retrieve Clearances with Clearance Status Code equal to “Claw Back” to include them in the following available SettlementTransferNotif message.