Negative Balance and Payouts

Understanding Stripe Payout Periods and Managing Negative Balances

When schools use Onespot Payments through Stripe, it's important to understand how payouts work, what causes negative balances, and why maintaining a small buffer is crucial.

⏳ What Is the Payout Period?

The payout period is the time between when a payment is made and when the funds are deposited into your school’s bank account.

For most U.S. schools:

• Payouts occur 2 business days after a payment is received (Stripe’s default).
• You can view or change this under Stripe > Settings > Payouts > Payout schedule.

🔴 What Is a Negative Balance?

A negative Stripe balance means that your account owes money—usually because expenses exceeded incoming funds. Stripe will not send any payouts until the balance is positive again.

Common causes:

What happens when your account is negative:

• No payouts will occur until future payments cover the negative balance
• Refunds can't be issued
• Delays in tuition deposits may frustrate schools and families

💡 Why Maintain a Positive Balance?

It's recommended by Stripe that users keep a small positive balance in Stripe ($100–$250+). Here’s why:

• Avoid payout delays due to post-payout fee deductions
• Be able to issue refunds instantly
• Absorb Stripe billing and platform fees without triggering negative balances

You can set a minimum balance in Stripe here: Settings > Balance > Set minimum balance

Problem with daily payouts:

• Stripe deducts transaction fees immediately (e.g., 2.9% + 30¢)
• Stripe also deducts Onespot platform fees (0.3%) at the time of transaction
• BUT billing/invoice fees (e.g., 0.4%–0.7%) are billed later
• Stripe pays out the full remaining balance before billing these delayed fees
• Result: negative balance after payout, which halts future payouts

Example: Let’s say your school receives a $10,000 tuition payment. Stripe deducts $290 in transaction fees (2.9%) and $30 in Onespot fees (0.3%) immediately, and the remaining $9,680 is scheduled for payout in 2 days.

However, at the end of the month, Stripe bills:

• $70 (0.7%) in invoicing/billing fees

Because your account was fully paid out daily, those $70 in post-charge fees create a negative balance. You won’t receive new payouts until this balance is covered.

Solution:

• Switch to weekly or monthly payouts to allow Stripe to aggregate and deduct all fees before payout
• OR set a minimum balance (1–2% of daily volume or at least $250) to buffer these delayed charges

✅ Recommended Best Practice

“To ensure timely payouts and avoid interruptions, we recommend that schools:

1. Set payout frequency to weekly (instead of daily)
2. Maintain a minimum Stripe balance of at least 1–2% of your average daily payment volume This ensures Stripe has room to deduct billing, invoicing, and platform fees before payout and prevents your account from entering a negative balance.”

🔗 Resources

• Stripe Docs: Payout Schedule
• Stripe Docs: Negative Balances
• Stripe Docs: Required Verification Info

If you'd like help adjusting your payout schedule or setting up a minimum balance, reach out to the Onespot team!

🔄 Daily Payouts vs. Weekly Payouts