Why is Wallet System important and what would happen if Wallet System is not used?
Wallet System on WPFreelance Theme functions like an escrow system on a freelance marketplace and offers many benefits to users:
Freelancers: Wallet System creates trust for the freelancers. Imagine when we work online for someone we do not know and after the task is complete, we do not receive the money. With Wallet System, this issue is resolved since the employers who hire the freelancers have to make payment from the start of the project. Hence, freelancers can rest assured that they will get paid after tasks are done.
Employers: On the contrary, when the employer hires a stranger to work on his project, he makes the full payment and expects to receive a high quality work. However, the freelancer does not live up to his expectation as the delivered result is quite bad. So this is a way to lose money. In this case, Wallet System also offers a good solution. Specifically, the employer’s payment is kept in the system and only released to freelancers when they fulfill the project requirements. Therefore, the employer can feel secure that his money is not wasted on the works that he can not use.
In the above two cases, the Wallet System plays a useful role in helping freelancers always get money when jobs are done and ensuring that employers would not lose money on low quality works.
What’s more? Using Wallet System also brings other benefits to your freelance marketplace website, such as increasing site reliability and reducing risk because once money is deposited to the Wallet System, all the transactions after that using credits in the Wallet System do not use real money, making it safer for your users.
Moreover, only by using Wallet System can employers and freelancers have access to the dispute center should something not go as planned. In this case, site admin will operate as a middleman between two parties and decide who wins and receives the money.
Basic information about Wallet System
Money deposited in the Wallet System is called credits. 1 unit of credit is equal to 1 unit of currency used on your site. For example, if the system is using US dollar ($), then 1 credit is equal to 1$.
In the Admin Dashboard, you can set these settings for the Wallet System:
- Commission amount: The amount of commission fee charged for each transaction on your site when employer decides to hire a freelancer and makes the payment.
- Commission type: There are two types available: by fixed amount and by percent. The first option will charge the same fee for every transaction while the second one will calculate fee as a percent of the payment of each transaction. For example, a project has a value of $200 and set the commission amount as 20. If it is a fixed amount, you will collect $20 as the commission fee from this project. On the other hand, if commission type is by percent, 20% of $200, which is $40, will be charged as the commission fee.
- Commission payer: You can choose either the employer or the freelancer to be the payer of the commission fee.
- Number of credits deposited to new accounts: To attract more users to your project bidding website and encourage them to make transactions, you can give some free credits to newly registered account by setting a number of free credits in this section.
How does the Wallet System work?
- Employer posts a project and freelancers will place bids on the project.
- Employer will review freelancers’ bids or send bid invitations to candidates he feels appropriate for his project.
- When employer decides to hire a freelancer, he will click button “Hire freelancer” and the system will display a form with the project information.
- Employer has to make a full payment and the system will check if his Wallet System has enough funds. If there are enough credits in his wallet, the payment will be proceeded. Otherwise, the employer is required to deposit money to his wallet to make the payment. To deposit money, the employer will go to My Wallet and choose Top-up Credit.
- After the payment is made, the freelancer will start to work on the project. The payment is now managed by the admin and appears in freelancer’s Wallet System under the pending section.
- When the freelancer delivers the work to the employer and the employer is satisfied with the result, he can mark the project as complete. At this phase, when the project is complete, the payment will be released to the freelancer. The credit amount will move from pending section to the available on freelancer’s Wallet System. Freelancer now can request withdrawal for the amount under the available section in his Wallet.
If there’s something unwanted that happens during the project and the employer or freelancer files a dispute, the system will update the project status to “Disputing” and the site admin will be notified of the dispute. In this situation, the site admin will act as the intermediary, collect necessary information about the project and make decision on who wins the dispute and receives the money.
- If admin selects employer to be the winner, the money will be returned to the employer Wallet System.
- If admin chooses freelancer to win, the money will be released to freelancer’s Wallet System.