Hemlane allows owners to let tenants pay by credit/debit card (and Cash App, when enabled) when creating a payment request. These payment methods can clear faster than ACH (bank-to-bank) transfers, but they also come with additional dispute risk compared to ACH payments.
What makes credit or debit card payments risky?
While any payment method can be disputed, credit and debit card payments are typically easier for tenants to dispute than ACH payments. This can increase the likelihood of a dispute being filed, even after funds appear to have been delivered.
What about Cash App payments?
Cash App payments can vary based on the tenant’s underlying payment method within Cash App, which Hemlane does not have visibility into. Because of this, both the dispute risk and processing behavior may differ from one Cash App payment to the next.
If the tenant funds the payment through a linked bank account, the dispute risk and processing will be similar to an ACH payment. If the tenant funds the payment through a linked credit or debit card, the dispute risk will be similar to a card payment. If the tenant funds the payment using their Cash App balance, the dispute risk is typically lower since disputes are handled through Cash App rather than a bank or card network.
Processing fees and disputes
When allowing payments by card or Cash App, there is an additional 3% processing fee. During payment request setup, the owner can choose whether the payor (tenant) or the payee (recipient/owner) will cover this fee.
If a payment dispute occurs on a credit/debit card or Cash App payment, the recipient of the payment may be responsible for the 3% processing fee, even if the payor originally covered it.
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