How it affects cash flow
Part of each eligible settlement is retained. A scheduled release may begin after the agreed holding period, subject to the account terms. The withheld amount is not necessarily an additional fee.
Model it before signing
Plan operating costs against money actually available, not gross sales. Include any minimum reserve, payout delay or other hold in the calculation.
Questions for the provider
- What percentage is held, and on which transactions?
- When do releases begin, and what can delay them?
- Is there a review process for changing the terms?
- What happens to the balance if the account closes?