I saw this post and applied online for their promotion. I have just started and because of this went and even set up a bank account(didnot need one earlier since I have not raised money from outside) , TaxId etc to get this free transaction and here is the email I get from braintree sales rep<p>Your business model is known as third party aggregation, which is considered higher risk by most banks. We do have a bank that will underwrite you likely, however due to the risk of the business model they will implement a 5-10% 6 month rolling reserve. Unfortunately that means you will be ineligible for the promotion.
( I donot see this on their ad)<p>If you would like to continue the process and apply with them, I'll just need you to fill out the prescreening questions below. If you have any questions, I've CCed a sales rep, Eric Hall. They should be able to help you out.<p>Then there is a bunch of question below. My question to them was what are they providing more than paypal or stripe besides this promotion to even go with them. Does anybody else know?<p>Even to underwrite me they want last twelve months P/L, balance sheet and what not
> what are they providing more than paypal or stripe<p>For one, they're providing the opportunity for you to open this business. That they have a bank willing to underwrite that type of account is significant.<p>PayPal, Stripe, and just about everyone else in the payment processing industry, will not work with you at all. Aggregating/factoring payments on behalf of others is prohibited in their terms/merchant agreements... because it's extremely financially risky to run such a company.<p>If it's not obvious to you why that is, you should consider picking up a cofounder with experience in online fraud/risk management. Managing fraud/risk is a core competency of every third party aggregator that survives its first few years. It's the reason PayPal is here today while their many earlier competitors went bankrupt.
At scale, they're cheaper than both Stripe and Paypal (not counting the discount for this promotion) -- once you get to a bigger volume in sales, you'd likely become eligible for better pricing than the 2.9% + 30cent standard everywhere.<p>Initially, it's probably as cost effective and quicker to get started with Stripe until such time as providing a 12 month P/L is easier to do, but by then this promotion will likely be gone.