payin with dwolla

[chadwhitacre]

"Ultimately we're trying to build the next Visa, not the next PayPal."

Dwolla is similar to Stripe Platform (see #58) in that everyone would have to create an account on Dwolla and then money would go directly from person to person instead of through a central Gittip bank account. I like this a lot. I had to upload a photo of my drivers license in order to integrate with a bank account, and there appears to be a manual review process before my bank is linked, and it's unclear that my bank is even linkable (it says "We could not add your bank at this time. Please complete any additional verification requirements.").

Geez. I think this would even be free.

"Cost to receive money in amounts greater than $10: $0.25"

Is the Dwolla (photo ID!) hurdle higher than giving up credit card details?

I think we need to support multiple options, like Venmo does (see #38). If tipper and tippee have Dwolla then we use that, if not then do a credit card dance. Something like that.

Want to back this issue? Post a bounty on it! We accept bounties via Bountysource.

[timothyfcook]

Wow, Dwolla is great. I've done a LOT of research into new payment platforms recently. Everything we've been using is downright criminal, especially for small payment/mini-tips/micro-donations. It makes NO sense that using electronic payment methods is more expensive than paper ones. Setting up EFT transfers is very tricky and, while not as bad as CC, is still pricey. Handwritten checks, for whatever reason, are still free.

That said, something like GIttip could be an excellent way to encourage new payment systems to gain popularity. As you mentioned, it doesn't do much good if only a few people have Dwolla. This is really big though... I've been searching for something like Dwolla for a few months, guess I didn't look hard enough. I love this quote: "This is very exciting - real time banking transfers. Time for ACH (and 5 working days money transfers) to die"

Maybe you could partner intentionally with Dwolla somehow to get more traffic headed your way. A site like yours could be a great way for them to gain a lot of users. I would feel good about highlighting the Dwolla sign-up feature way more than the CC option... give them some serious advertising, for the sake of all of us.

[timothyfcook]

The rhetoric Dwolla uses is just like Gittip:

We think, in the long term, sending money should be as easy and effortless as finding a friend on Facebook. That's really a behavior we try to mimic when it comes to peer-to -eer payments. When someone does not have a Dwolla account, they get a wall post that says, "You've got money."

You can send people money without them signing up, but they can only receive it if they sign up and claim it... another synergy. Been reading about dwolla for the past half hour. I'm hooked.

[timothyfcook]

Just realized, essentially what Dwolla does is eliminate a 3% tax that we---somewhat ignorantly--pay on everything we purchase.

[ipmb]

Dwolla is U.S only

[chadwhitacre]

Word. Best way forward is multiple ways to move money in and out, methinks.

[timothyfcook]

Hopefully this new Balanced Payments works out. Are you hoping their "escrowing" capability will enable the holding of $$ until disbursement time (friday)?

The UI should be:

"You tip $1.32 per week." To back your tips:
1. Link your fancy new Dwolla account (and save on processing fees)
2. Or link your old timey credit card (and add the processing fees to your payment)

On Jun 25, 2012, at 2:43 PM, Chad Whitacre wrote:

Word. Best way forward is multiple ways to move money in and out, methinks.

---

Reply to this email directly or view it on GitHub:
https://github.com/whit537/www.gittip.com/issues/65#issuecomment-6556027

[chadwhitacre]

@ipmb Who isn't US only?

[ipmb]

Credit cards. I have no experience with them, but Paxum is out there as well. Only know about them from the TradeHill/Dwolla fiasco.

[chadwhitacre]

Right. Credit cards are working now for international payins (though this could be clearer; #57). Where we're currently stuck is international pay_outs_ (#126).

[treyhunner]

👍 from me.

Losing $0.30 plus 2.9% per deposits and $0.25 per withdrawal is a shame when the transaction amounts are so small.

[jfricker]

+1 for Dwolla. Seems like a natural fit.

[Dwolla]

Just saw this thread now. This is awesome. I'll get on it today and submit a pull request as soon as it's ready!

[chadwhitacre]

@Dwolla: Thanks for jumping in! :-)

I want to make sure we respect Balanced, since they have already joined the Gittip dev community and have been contributing integration with their service (#78) as well as visual design (#66). My ideal would be to use Balanced for white-label credit card and ACH transfers (where the user enters cc/bank account details directly on the Gittip site) and have Dwolla as a second option.

My understanding is that users will have to be taken off the Gittip site to the Dwolla site to set up an account if they don't already have one, yes? Can you also help me understand how payment flow will work with Dwolla? We need to batch gifts to preserve anonymity. We don't want to do transfers directly from one user to another.

[chadwhitacre]

Let the record show that @timothyfcook got the ball rolling on this.

[jkwade]

Welcome aboard, @Dwolla! Please let us or @whit537 or @timothyfcook know how we can help you get going

[timothyfcook]

excited about @Dwolla integration, it's a perfect partnership.

[Dwolla]

Thanks, @jkwade and @whit537. This is really exciting..

Anyway, yes, you're correct @whit537. If someone doesn't have a Dwolla account, they would have to create one on the Dwolla website. I think that the best way to go about this would be to use our OAuth / REST API. This would allow us to prompt a user for permissions the first time around, and never bother them again. Other than the Dwolla branded OAuth permissions pop up, we don't have to display Dwolla branding at all, and everything can happen on the gittip server.

Re batch processing: it's definitely possible. @whit537, I'm assuming you're ok with being the "merchant of record" for all these transactions?

[chadwhitacre]

@Dwolla Yes, I expect to be the merchant of record (I think). You are aware that Gittip is a marketplace aka third-party payment processor, right? Is that okay with you?

The data flow I need is, once a week, to pull money in from donors, aggregate it, and distribute it to donees. So if Alice, Bob, and Cletus are each set up to give Diane $3, then on Friday we pull in $3 each from Alice, Bob, and Cletus, and we deposit $9 in Diane's account. For transfers over $10 we need to upcharge on payin and subtract from payouts. So if Alice is giving $15 each week in total, then we actually charge her $15.25 to cover the $0.25 fee. On the way out, if Bob is receiving $15, then he actually only gets $14.75; he's responsible for the $0.25 fee to Dwolla. Make sense?

As far as the UI for associating a Dwolla account goes, I think it will work best to subsume that under a general "link accounts" feature. Presumably someone should be able to sign up for Gittip with only a Dwolla account (in the way that we use GitHub now).

[timothyfcook]

Are you saying that you would have the transaction require a $0.25 Dwolla payment on both sides? Double-taxed? Seems less than ideal… but might be the only way to keep anonymity.

On Aug 1, 2012, at 4:14 PM, Chad Whitacre wrote:

@Dwolla Yes, I expect to be the merchant of record (I think). You are aware that Gittip is a marketplace aka third-party payment processor, right? Is that okay with you?

The data flow I need is, once a week, to pull money in from donors, aggregate it, and distribute it to donees. So if Alice, Bob, and Cletus are each set up to give Diane $3, then on Friday we pull in $3 each from Alice, Bob, and Cletus, and we deposit $9 in Diane's account. For transfers over $10 we need to upcharge on payin and subtract from payouts. So if Alice is giving $15 each week in total, then we actually charge her $15.25 to cover the $0.25 fee. On the way out, if Bob is receiving $15, then he actually only gets $14.75; he's responsible for the $0.25 fee to Dwolla. Make sense?

As far as the UI for associating a Dwolla account goes, I think it will work best to subsume that under a general "link accounts" feature. Presumably someone should be able to sign up for Gittip with only a Dwolla account (in the way that we use GitHub now).

---

Reply to this email directly or view it on GitHub:
https://github.com/whit537/www.gittip.com/issues/65#issuecomment-7438587

[chadwhitacre]

@timothyfcook If @Dwolla can suggest a way to preserve anonymity and minimize fees even further I'm open to that. Note that I am wary of paying Dwolla nothing because it disincentivizes them from participating.

[Dwolla]

I'd hate to double charge on this flow. If you guys are ok with splitting up payments into $10 blocks, I'd be more than happy to do that. We can do that on either sides of the payment, but I think the best way to go about this would be to split up the payouts from the Gittip account. What do you think?

Re UI, I agree with @whit537. I can add a "Connect with Dwolla" button that will trigger an OAuth permissions dialog.

[chadwhitacre]

Hmmm ... I'd actually be inclined to make the donee pay the $0.25, and chunk the payins. The donee is the customer here. They're the ones Gittip is designed for. And I expect payins to be more likely to be < $10 anyway.

Just scab on whatever you need for UI, @Dwolla. It's getting an overhaul in #66 and I'm happy to clean up whatever you give me in the mean time.

[Dwolla]

Awesome, yes. We can do chunk the payins. We're having a hackathon out here in NYC this weekend. I'll get this done then. Coincidentally, if any of you are in the area and would like to stop by for some free food and swag, let me know, I'll add you to the guest list.

[chadwhitacre]

@Dwolla How was the hackathon? Any progress on this? Questions?

[zellyn]

@whit537 Have you thought about aggregating transfers the way iTunes does to avoid fees? For instance, with Dwolla, you have a fixed $0.25 fee. If donors could configure gittip to pull a larger chunk of money at a time, you could amortize the fee over several weeks. Also, if you organized things right, the held money could earn interest and provide an income for you. Or, if people (or you) aren't okay with that, you could let donors configure what should happen with the interest.

[chadwhitacre]

@zellyn We upped the minimum credit card charge to $10 to mitigate fees somewhat (#167). Prepayment could address this further; that's #113. I've ticketed the interest question as #279.

[mvdkleijn]

Seems @Dwolla has been very quiet on this ticket since the last time @whit537 asked @Dwolla how the hackathon went... a year ago.

Is this still going to happen? (personally I don't care since Dwolla is US-only)

[chadwhitacre]

+1 from Jonathan Kryza via support@gittip.com:

I found your website via a comment on Reddit. I think it is awesome but I could not help but notice your processing fees(which are pretty standard). Since a user has to setup an account and gittip only charges in $10 increments, I would highly recommend Dwolla. Anything $10 or below is FREE to process. Anything over is just $0.25....that's it. No percentages.

Dwolla also bypasses the banks, so any money transferred between accounts goes through immediately. If the recipient does not want to pay others with Dwolla, they can change a setting on the account to automatically move any available balance in their Dwolla account to their linked bank account.

They are in the US only right now, but I know this could save your donators/users money and you hassle.

Here is their dev page.

I do not work there, but I work in the card processing industry and love what they are doing.

Thanks and great work!

[mlncn]

Count me another who would very much like to pay via Dwolla rather than PayPal or even credit card directly. @Dwolla @whit537 what do we need to make this happen? What's the next step? Is there code somewhere to work on?

[chadwhitacre]

@mlncn Weeellllll ... we don't really have any code for this already. The place to start would probably be with the user interface. Can you describe for us how this would fit into the site as it currently stands from a UI perspective?

[mlncn]

The way GitTip is set up so far makes it quite simple for a first step. Change the prompt:

Back your gift with a credit card to make sure it goes through!

To:

Back your gift with a credit card or Dwolla to make sure it goes through!

And then, on a new dwolla.html page there's a button to authorize GitTip to connect with your Dwolla account and https://developers.dwolla.com/dev/pages/auth does the work (for that page, actually taking payments in, and ultimately out, with Dwolla will take a bit more code on our side).

[chadwhitacre]

Good start. Let's unpack that.

I guess we have an additional "Dwolla" entry under "Connected Accounts"?

What are the implications for payday? Right now payday runs as three loops: payin, pachinko, payout. The payin loop right now assumes that we have an instant API: charge a credit card, and know w/in ms that the money is ours to work with. Does Dwolla give us a similar instant API experience, or is it time-lagged?

[mlncn]

If there is money in someone's Dwolla account, it is instant to put it in someone else's (GitTip's) Dwolla account. But if not, there's an about three day lag while money goes from the donor's bank account to Dwolla. I imagine most people, like me, don't keep any money in their Dwolla account, though. It is possible to set a minimum balance in Dwolla which would make all payments less than or equal to that minimum balance effectively instant.

(Back in 2011 they talked about something called Dwolla Instant where you could send money immediately even if it weren't in Dwolla yet, but it cost $3 a month which is a terrible deal, and i think they dropped that.)

What mechanisms are in place for a chargeback from a credit card company? As Dwolla hooks directly to people's bank accounts, i don't think the chances of the money not coming in in 3-4 days is too much higher than the chances of a chargeback.

These would be recurring payments though, and i don't know if Dwolla is smart enough to start getting the money from donors' bank accounts 4 days ahead of the recurring payment date, which would make the delay only an issue for the first one.

Maybe the easiest from GitTip's side would be if it only starts with the minimum balance put in Dwolla first, but i doubt Dwolla's API exposes that— and we still need recurring payments to either go through on time.

OK, right now i'm thinking easiest is a hard-coded 4-day delay on Dwolla-related payments to be sure we can check the money is there before anything starts.

@Dwolla some help here?

[patcon]

+1 for dwolla pay-ins from some guy at this hostel

[rummik]

I'm going to +1 this as well. I like seeing more options where possible.

[duckinator]

+1 for the same reason as @rummik.

[chadwhitacre]

+1 from @McCroden on Twitter.

[chadwhitacre]

Dwolla sales: https://gratipay.freshdesk.com/helpdesk/tickets/1947.

[avimar]

Dwolla cancelled their transaction fees, BTW.

[webmaven]

I figure, since I am stumping for Dwolla payouts for myself (in #726), I might as well give my own 👍 for Dwolla pay_ins_, as well.

[mattbk]

+1 from https://gratipay.freshdesk.com/helpdesk/tickets/4078.

[nobodxbodon]

Re-ticketed to gratipay/inside.gratipay.com#974 for further discussion and planning. After deciding on concrete implementation plan and dev work starts, this will be reopened for tracking purpose.