Understanding Payout Fees

Overview

Every payout has a processing fee. Like pay-in fees, each payout fee dimension supports three fee payer modes — user, merchant, and invoice — configured independently per fee type. By default, every fee dimension is set to user: the fee is deducted from the withdrawal amount, so the customer receives less than they requested. Reach out to the Coinflow team to move a fee dimension to merchant or invoice mode.

This is the same concept as pay-in fees, applied to payouts

See Fee Pass-Through for how these three modes work on the checkout side. The mechanics are the same; only the direction of money movement differs — pay-in fees are added on top of a charge, payout fees are deducted from a withdrawal.

The three modes

Customer pays (default)

Fee payer mode: user

The processing fee is subtracted from the withdrawal amount before the customer receives funds. This is the default for every fee dimension unless your account has been configured otherwise.

Requested amount: $100.00
Processing fee:     $2.50
Customer receives: $97.50

These example amounts are illustrative only. Your actual processing fee is set in your MSA — contact the Coinflow team to confirm your rates.

Merchant pays

Fee payer mode: merchant

The customer receives the full requested amount. The fee is charged to you instead, deducted from the funding you send for that payout at the time it’s processed.

Requested amount: $100.00
Customer receives: $100.00
Fee charged to you:  $2.50 (settled inline with the payout)

Turning this on

Merchant-pays isn’t the default. Contact the Coinflow team to move a fee dimension to merchant mode, or see Add Your Own Payout Fees for the dashboard toggle that covers the processing fee.

Invoice

Fee payer mode: invoice

The customer receives the full requested amount, exactly like merchant-pays. The difference is when and how you’re charged: instead of being deducted from that payout’s funding immediately, the fee accrues against your account and Coinflow invoices you for the accumulated total at the end of your billing period.

Requested amount: $100.00
Customer receives: $100.00
Fee charged to you:  $2.50 (added to your running invoice balance)

Same net cost, different cash-flow timing

Whether a fee dimension is set to merchant or invoice, you ultimately pay the same amount. merchant mode nets it out payout-by-payout; invoice mode bills it to you in bulk later. Choose based on how you want the cash flow to hit your books, not because one is cheaper than the other.

Turning this on

Invoice mode isn’t the default and is configured per fee dimension. Contact the Coinflow team to enable it for your account.

Fee dimensions are independent

You can set different modes for different fee dimensions — they aren’t all-or-nothing:

Processing fee

Coinflow’s base per-withdrawal fee (a fixed amount plus a percentage of the withdrawal, with an optional minimum/maximum). This is the fee the “Cover Processing Fees” dashboard toggle controls.

Network/conversion fees

Additional costs that can apply depending on the payout method or destination, configurable independently of the processing fee.

Custom fees

If you’ve configured your own additional fee on top of Coinflow’s processing fee, that custom fee is always charged to the customer — the fee payer mode only applies to Coinflow’s own processing and network fees, not to fees you’ve added yourself.

First-party payouts

When you withdraw to your own merchant-owned destination (rather than a customer’s), custom fees are skipped entirely — they only apply to customer withdrawals.

What you’ll see in the withdrawal data

A completed withdrawal reports fees split into a user-paid bucket and a merchant-paid bucket, broken out by dimension. For a customer-pays (user) fee, the amount appears under the user bucket and is subtracted from what the customer receives. For a merchant-pays or invoice fee, it appears under the merchant bucket instead — and if it’s on invoice mode, it’s also reflected as an outstanding balance attached to the invoice it will be billed on.

The total withdrawal amount reported is always the gross requested amount. To get what the customer actually received, subtract the user-paid fees from that gross amount.

Don’t confuse this with invoiced pay-in fees

If you’ve moved a checkout (pay-in) fee dimension to invoice mode, that’s billed the same way — via a monthly invoice — but it’s a separate configuration from the payout fee payer modes described here. See Fee Pass-Through for that flow.