Recovery playbook
Netting recoveries against future transfers
A reversal is instant and adversarial: the seller sees a debit they did not expect, on money they may already have spent. Netting is slow and agreed: the next payout is smaller than usual, everyone was told in advance, and the relationship survives the arithmetic. Same dollars, very different commercial cost — and for active sellers with ongoing relationships it is frequently the better instrument. This playbook covers when netting beats reversal, the mechanics, and the terms problem that decides whether it is lawful rather than merely polite.
What netting is
Withhold the owed amount from the next transfer you would create to that account anyway, repeating across transfers until the finding is recovered. The seller still gets paid — just smaller, and told first. From your ledger’s perspective each withholding is its own event referencing the original finding; from the seller’s it is one unusual week rather than one alarming surprise.
When netting beats reversal — and when it does not
Choose netting for active sellers with ongoing relationships, amounts below your surprise threshold, and disputes about service quality rather than fraud. Choose reversal when the account churned, fraud is involved, terms were breached, or the amount is material enough that time-value matters more than goodwill. Choosing reversal-by-default for good sellers is how marketplaces acquire a reputation that precedes their recruiting pitch.
The mechanics
Compute owed = expected reversal − actual reversals, apply it against the next transfer amount, floor at zero, and record each netting as its own ledger line referencing the finding id. The referencing matters more than the arithmetic: six months from now a controller will ask why that transfer was short, and "finding FG-1231, resolved by netting" is an answer while "we deducted some" is a project.
- Owed to platform
- $54.00
- Next scheduled transfer
- $200.00
- Transfer sent
- $146.00
- Finding closed as
- Resolved — netted
The terms problem
Netting without a contractual setoff right is a unilateral deduction from money the seller may consider theirs — legally murky and commercially worse. Put reconciliation-and-setoff language in seller terms before you rely on it: the right to withhold amounts determined owed under the reconciliation process, with notice and a dispute window. Direction only, explicitly not legal advice; counsel reviews the sentence, operations applies it.
What FeeGuard does about it
Findings carry the exact owed figure and remain open until resolved, however many transfer cycles netting takes. The CSV export gives ops the ids and amounts to apply; the append-only audit trail ties every adjustment to its finding so month-end finds answers instead of mysteries.
Common questions
Can Stripe net automatically for us?
No. Setoff happens on your side of the ledger, applied when you create transfers. Stripe moves exactly what you instruct.
Does netting work for dispute losses too?
Yes — the owed figure is computed identically (transfer remainder), so the same netting machinery serves both causes.
What if the seller objects mid-netting?
That is what the notice period and dispute window are for. Pause the netting, review the evidence together, resume or write off deliberately.