How to Choose a Reliable Peer to Peer Payment Method for Your Marketplace

How to Choose a Reliable Peer to Peer Payment Method for Your Marketplace

Safety and trust are the most significant factors when it comes to peer to peer payments in online marketplaces. If there is even tiny uncertainty in their security, you risk to lose credibility, and, as a result - customers. To prevent you from such a situation we have prepared the article that will help you to choose the right P2P marketplace payment gateway.

What is P2P payment and how do P2P payments work?

P2P payment is a technology that allows users transferring money from their credit card or bank account to another individual's account. In this case, P2P platform acts as a middleman that processes these transactions. P2P payments are basically used for personal, but not commercial transactions. Let’s see the most basic P2P payment methods you can incorporate into your online marketplace.

P2P payment methods

  • Credit cards
  • Direct bank transfer
  • Payment gateways (PayPal, Stripe Connect, MangoPay)
  • Your own payment system

To make the payment on your marketplace convenient for users, it is better to combine different payment methods under one roof. To enhance user convenience, you might consider options to create a digital wallet within your platform.

P2P payment providers for online marketplace (overview and comparison)

Here are some of the examples of P2P payment systems you can integrate into your marketplace platform. Of course, there is no good or bad payment method as it all depends on your business model. However, after reading about these payment technologies you will get some insight into what features your payment gateway should provide.

- Mangopay




Сustomizable payment management system for marketplaces that allows creating e-wallets for sellers, buyers, contributors, where they can hold funds as long as they need. With MangoPay you can manage deposits, collect your fees, and refund payers to their e-wallets or bank accounts. In addition, you can split and escrow the funds, which is very suitable for P2P marketplace concept.

What is valuable about MangoPay is that it gives you a full freedom in designing your checkout pages. You can create your own payment flow and design for each transaction.

Here is the list of countries MangoPay is available at.

- Braintree




Braintree is an all-in-one payment system that provides a special module you can install on your marketplace. By using this module, your customers can make payments almost with any credit card without being redirected to another website. It accepts payments in more than 130 currencies and over 45 countries.

Braintree offers a scalable solution for online marketplaces with API customizable to your business model. This module offers useful features essential for marketplace industry: сreation of merchant accounts for sellers, splitting payments, anti-fraud tools, and automated management of chargebacks, retrievals, and pre-arbitrations.

- GoCardless




GoCardless is a non-credit card money transfer system for taking recurring payments that incorporates direct debit. Direct debit allows businesses to control payments either by using an online dashboard of GoCardless partner integrations or building your own integration with GoCardless API. It is better to use these solutions alongside credit cards to facilitate peer to peer payment and free you from controlling the funds.

GoCardless solution



Spreedly is a single payment API, that lets you collect payment details with special card capture tools. It offers iFrame payment forms, by implementing which you can collect credit card numbers and CVVs keeping these data off your servers. Spreedly integrates with 120+ payment gateways (e.g. Braintree, Stripe) and 100+ third-party payment APIs.



Escrow is a secure payment method that acts like a third party that collects and holds the funds, releasing them to the seller, only when both parties are satisfied. offers many types of payment options including wire transfers, checks and money orders, credit cards and PayPal. Here is how it works:



Now let's proceed to the comparison of these payment systems.


payment methods comparison


Click here to see the image in full size.

P2P payment security. How to build trust on your P2P marketplace

In case of P2P marketplaces where transactions are carried out between strangers, a marketplace platform should act as a reliable middleman between them. Here are some tips on how to securely process payments on P2P marketplaces.

  • Offer escrow service

With escrow service money are held on the platform until a service provider completes a service or a buyer receives a product. When choosing a payment provider, make sure that it has an option to escrow funds. This is very convenient in a P2P marketplace model, where trust matters the most.

Some payment gateways offer an escrow solution for marketplaces, like Braintree Marketplace in the US and MangoPay in Europe. These solutions decrease the legal liability for the platform owner. Others, like WePay and Stripe, opt to collect credit card details but charge the card only when the money is ready to be moved.

  • Incorporate credit card pre-authorization

This is how pre-authorization works: the users enter credit card details but the money is not transferred. Instead, the credit card company guarantees that the card has a credit to transfer money within some period of time. This is very useful for the marketplaces, where the buyer or seller need to approve or decline the operation before releasing funds. Remember, that pre-authorization is possible only with PayPal and credit cards.

- **Provide buyer/seller protection programs**

Buyer and seller protection programs help to mitigate risks and protect sellers and buyers in case of any complaints or disputes. For example, look at the seller protection program by PayPal or a buyer protection program by PayU.

What payment solutions do P2P marketplaces use?

Now let's see how some P2P marketplaces enable P2P mobile payments.

  • Vayable - a P2P marketplace for finding things to do in different cities.

Vayable used to have PayPal as a payment method for a long time until one sticky situation happened. Too many users have experienced PayPal freezing their funds and refusing to release them for several months. After this, they use only Stripe as a payment processor.

- Etsy - P2P marketplace that focuses on buying and selling hand-crafted or vintage goods.

Etsy offers the following payment options for their users:

  • Credit cards
  • Debit/bank cards
  • Etsy Gift Cards and Etsy Credits
  • PayPal
  • Klarna Invoice payments (Germany)
  • iDEAL (the Netherlands only)
  • Sofort (Austria and Germany)
  • Apple Pay
  • Android Pay

You can read more about their payment policy here

  • VRBO - vacation rental marketplace

The most secure way to pay for the vacation rental on this marketplace is with a credit card or eCheck. When the user enters the payment information, VRBO protects their credit card and personal information.

- - marketplace website for posting jobs, freelancers can bid for.

Freelancer uses the following payment options:

  • integration
  • Bank deposit
  • Credit card, PayPal or Skrill
  • Express Withdrawal


How to integrate peer to peer payment API: things to remember

Before choosing the payment provider, ask yourself the following questions:

  • Do you need to escrow payments once a buyer pays or do you send money straight to the seller's account?
  • Do you need to split payments (take the cut and give the rest to the seller)?
    How will you deal with anti-fraud measures?
  • Is your marketplace local or global? Are you going to scale in the future?
  • When and how will you give the money to the provider?
  • Do you prefer direct or hosted payment system?

Let's dig a little into it:

Direct - Provides you with a hosted iframe you can put on your charge page. It allows you to receive credit card information directly. The user stays on your website during the whole checkout process. It allows you to better control the user experience and have all the data to combat fraud and chargebacks.

However, in this case, you take the full responsibility for the security of transactions and liability for any breaches. For this, you need to have SSL certificate on your website and PCI requirements compliance

Hosted - provides you with a hosted iFrame you can put on your page and redirects to the payment gateway hosted page. The customer will be returned to your website to the confirmation page. Cons - less control over user-experience as they are redirected to another page (if it takes too long to complete the payment load the page users may abandon your website without completing a purchase, little visibility into transactions which may cause problems with controlling it).

However, this solution is safer and gives a customer more confidence while filling-in payment credit card information + helps you meet PCI requirements

Wrapping Up

While looking for the suitable payment system, always keep these questions in mind and choose what payment methods will meet your requirements best. To wrap everything up, let's summarize how to integrate a peer to peer payment system into your marketplace:

  • Choose a payment system that supports different payment methods
  • It is better to choose a payment system that supports those who have a merchant account and those who don’t
  • Carefully read about the fees a system charges
  • Choose a system that supports the ability to escrow and split funds
  • It is recommended to choose a payment system that enables you to track the transaction reports

If you have any questions about the payment system implementation, don't hesitate to get in touch with our Apiko development team.