US media coverage of payment reserves today

[#1]

https://www.theverge.com/2023/7/29/23810536/etsy-sellers-payment-reserves-fraud-protection

Quote: "Less than 2 percent of shops currently have a payment reserve placed on their accounts, and for most of those shops, the amount being held is less than $50, says Chirag Patel, head of payments at Etsy"

Based on the most recent numbers of "active" shops on Etsy - 5.9 million - that means 60K to 120K shops on reserve right now. Since Etsy removed a bunch of reserves recently after the negative attention in the UK, that means the number was almost certainly much more than that in May and June.

[MirageRiverCreations]

@SheWhoPlaysWithGlass Funnily enough, it does not surprise me that those crooked financial institutions are also involved in Etsy.

[EpoqueVintage]

@cindylouwho2 

Hot off the press, I believe! 

[DKVintageandBeyond]

They stated they put aside 25 million for the buyer protection program for refunds so where is that coming from hmmm🤷‍

[CryzalisDesigns]

I wonder if that is enough to cover the mistakes made by bots instantly refunding just for Etsy to have to pay the seller back via the appeal process

[peacockanddragon]

front page this morning https://www.bbc.co.uk/news/business-66201042

[TheHeathWorkshop]

$50 my arse. If you believe that then you are really beyond help.

[BlackberryDesigns]

I looked at the 1st quarter financials and they are currently hold 323 million dollars in sellers funds if you go to EDGAR you are able to see the financials, and it will sit as a liability on the books with a offsetting asset, now that does not mean this is all reserves, it could be a multiple of things, like funds not yet disbursed as of the ending date of the financial statement, they haven't issued a footnote on the financials as to what this money is.  My guess, they are holding millions and we will never know the amount.  

[BlackberryDesigns]

@BlackberryDesigns 

Oops...modified to say 203 million.  

[AntiqueAnimalJewelry]

SheWhoPlaysWithGlass

oh well, that will mean the end of small businesses then.

[RadShirtzDotCom]

I have over $1000 in reserves and haven’t been paid a single cent by Etsy. Is it a scam now?

[lacroixdollon]

Mine is only £100, but I could really do with it. I am not sending any more orders until I have it.   What is happening?

[LanaLuckyFinds]

When your accounts payable are immediate (Etsy fees) and accounts receivable are 45-90 days, this is a road to insolvency. Practically, Etsy is pushing micro businesses to bankruptcy. Other marketplaces hold your funds until the product is delivered plus 3 business days for possible returns, then they release your funds. But 90 days...

[BlackberryDesigns]

Quote from a recent article from Fashion United UK 07-31.  Just a small online publication.

While Etsy maintains that the vast majority of sellers receive their funds upon sale, sellers are calling for changes to the reserve system. The Federation of Small Businesses emphasizes the responsibility of online platforms in handling sellers' finances and urges them to use their power responsibly. Etsy has indicated its commitment to improving its programs, including payment reserves, but its actions have prompted discussions with UK government officials.  (The reason they released all the reserves on UK sellers a few days ago - seriously Etsy never thought anyone could or would try and stop them - I am so angry about their current financial practices).  

The situation underscores how online platforms can impact the livelihoods of small businesses, necessitating greater scrutiny and regulation in the sector.

Since etsy can't do the ethical/legal thing and have run amuck with their power.   Hopefully, that regulation is coming and will be imposed on them.  Now the USA needs to catch up and the FTC needs to step up and impose modified banking regulations on etsy.  If you function as a financial institution, holding and disbursing funds you need regulation.  Without it, this is exactly what happens.  I sound like a broken record and have been saying this in the forums since 2016.  

[Eclecticgoods4U]

I am in total agreement with you....ALL sellers need to take this outside of these forum walls and complain loudly as sellers in the UK have.....this does not need to become status quo.

[cindylouwho2]

@Eclecticgoods4U I've been saying that on multiple points for years now. You never know which complaint will catch the eyes of a government official or a media outlet. 

The BBC article has greatly increased the talk of reserves on Twitter in the last 12 hours. More UK media outlets are looking to interview people now. 

[Eclecticgoods4U]

sellers should comment on the UK article.....I did....

[EpoqueVintage]

Plenty of angry sellers on reserve here in the EU, especially regarding the lack of transparency surrounding  the payment  reserves. Etsy of course has its European HQ in Dublin so Etsys policys will hopefully be looked into and they will need to explain themselves. Inroads are now being made to the EU commission, it's quite a complicated process but now thanks to a few very tenacious British sellers the UK media are covering this so widely that it will smooth the pathway somewhat. 

[mustardseed]

I currently have $167.51 in reserves and I have shipped all my orders. They are holding it for 55 cents that they want for etsy off site ads which I don't even want to be a part of. This is nuts! I'm leaving etsy. this is the final straw!!

[cindylouwho2]

@mustardseed when did you ship your orders? Money does not get released until after tracking that Etsy can read shows movement. It also can take a little longer at the beginning of a reserve, according to some. 

[EpoqueVintage]

@cindylouwho2 

Not sure if you have heard this yet Cindy hope you can access this link....You might need to download  the BBC app but here is the follow up piece on the Etsy  payment reserves on the You and Yours show, a consumer program on BBC Radio 4. 

[cindylouwho2]

@EpoqueVintage Thanks! I saw your other post. 

[EpoqueVintage]

@cindylouwho2 

Toggling between the two!!! 

[BlackberryDesigns]

How ironic that they are now offering us 3rd party loans through the platform!  As they hold millions in reserves.  Just popup in my email from etsy.  Guess their solution is to hold money in reserves and earn interest, and then give you a loan (3rd party) so make more interest.  I am sure there is something for them to gain monetarily, like they get a percentage of the loan.  

I tried posting here, but etsy readacted it, it maybe in your inbox.  

Part of the disclaimer:

"*YouLend is not affiliated with Etsy, but is a merchant cash advance provider with whom we entered into a relationship. "

Personally, I would like to know what that relationship looks like?

Etsy has done so much to the sellers recently it is almost impossible for me to believe they have the good intentions of the sellers.

[cindylouwho2]

@BlackberryDesigns interesting! Probably only in the US. 

I posted the full screenshot to Twitter. Will put it up elsewhere as well.