Knowledgebase: 20. Escrow account
20.02. What are the benefits of the Escrow account?
  • Risk management – the buyer and the seller, in order to manage the risk of possible settlement failure or poor quality of the good/service, decide to conclude an escrow agreement, by agreeing that the buyer will settle with the seller not directly, but via an agent (in this case via the escrow service provider – Paysera).

  • Protection of paid funds – Paysera, by following conditions set out in the agreement, holds the funds deposited to the escrow account and releases them to the seller only when conditions described in the agreement are fulfilled (for example, by submitting a notification in the established format about receipt of goods).

    If a trade deal between the buyer and the seller fails, Paysera returns deposited funds to the buyer. 

  • Interests of both parties are protected – Paysera seeks to protect the interests of parties to the agreement, both the buyer and the seller, and by selecting Paysera as your agent, you can feel safe and be confident. 

             Protected interests of the seller   

               - Buyer’s trustworthiness is verified

               - Individual conditions for purchase and return of assets are set

               - Money is deposited in advance – the risk of insolvency/late payment is eliminated

               - The risk of unexpected charge-back is eliminated

               - If the asset (good) is returned, the buyer receives the funds paid only after the asset reaches the seller safely

            Protected interests of the buyer:

               - Seller’s trustworthiness is verified

               - Individual conditions for purchase and return of assets are set

               - Money is released only after the asset is transferred to the buyer

               - Deadlines for performing trade deals are set – it is in the interests of the seller to meet the deadline

  • Safe and acknowledged agent – Paysera is a well-known and experienced finance institution, as well as a leader in e-shop payment collection in the Baltics. The institution assures safe and smooth management of both simple and more complex trade cases. 

    Security of deposited funds: since 2012, Paysera is a licensed e-money institution with the right to execute the activity related to issuance of e-money and provision of payment services all around the European Union. The e-money institution license was issued by the Bank of Lithuania. The institution is periodically checked and audited by the central bank of the Republic of Lithuania, which supervises financial institutions and helps ensuring the transparency and impeccable activity. Official website of the Bank of Lithuania: www.lb.lt.

    Please note that clients’ funds held on Paysera account are held in accordance with Article 25(1) of the Republic of Lithuania Law on Electronic Money and Electronic Money Institutions. In this case, the funds of clients:

    - Are kept on special bank accounts intended for keeping clients’ funds

    - Are not used for the needs of the company, are not lent or invested

    - They are not subject of recovery due to the debts of the electronic money institution.

  • Transparent sales and purchase process  – the process of opening an escrow account is short, clear and transparent. The account will be visible to all the parties to the trade deal during the entire process.