Payout Instructions
A payout instruction defines how funds should be delivered to a recipient.
When funds become eligible for disbursement, the platform creates a payout instruction that identifies the recipient, payout amount, destination, and delivery preferences. Before the payout can be executed, the selected destination must be configured, validated, and approved for use.
Payout instructions help platforms manage how funds are routed and delivered while supporting compliance, operational controls, recipient preferences, reporting, and reconciliation requirements.
How Payout Instructions Work
At a high level, payout instructions are generated after funds become available for distribution.
The payout instruction serves as the record that tells the platform where funds should be delivered, how the payout should be processed, and which controls must be satisfied before funds are released.
Configure a Payout Destination
Before payouts can be sent, recipients must establish a valid payout destination.
Typical setup activities may include:
- Recipient onboarding
- Identity verification
- KYC/KYB validation
- Country eligibility verification
- Recipient profile creation
- Enrollment in payout services
Specific onboarding requirements may vary based on the implemented solution and applicable regulatory requirements.
Configure Payout Preferences
Recipients select how they want to receive funds.
Supported Payout Methods
| Payout Method | Description |
|---|---|
| Bank Account | Funds delivered to a supported bank account. |
| Debit Card | Funds delivered to an eligible debit card destination. |
| Digital Wallet | Funds delivered to a supported wallet provider. |
| FFP-Enabled Account | Funds delivered to an FFP-managed account or wallet. |
| Cross-Border Destination | Funds delivered using an approved international payout method. |
Platforms may support one or more payout options depending on the configured experience.
Validate the Payout Destination
Before payouts are enabled, the destination may be reviewed and validated to help ensure funds can be delivered successfully and securely.
Destination Information Requirements
| Payout Destination | Information Requirements |
|---|---|
| Bank Account | Account number, routing number, account type |
| Debit Card | Card information and supported payout network details |
| Digital Wallet | Wallet identifier and destination-specific information |
| Cross-Border Destination | Country-specific account information and provider-required details |
| FFP-Enabled Account | Account or wallet identifier associated with the recipient |
Additional information may be required depending on the payout destination, country, currency, and applicable regulations.
Store Payout Preferences
After validation is completed, the payout destination is associated with the recipient profile.
Examples of stored preferences may include:
- Preferred payout destination
- Primary payout method
- Country eligibility information
- Destination identifiers
- Supported payout capabilities
These preferences are referenced when future payout instructions are created.
Creating a Payout Instruction
A payout instruction is generated when funds become available for disbursement.
Common triggers include:
- Completion of a transaction
- Settlement events
- Scheduled payout events
- On-demand payout requests
- Platform-defined business rules
A payout instruction contains the information required to identify the recipient, funding source, destination, processing requirements, and reporting details associated with the payout.
Payout Instruction Information
| Information Type | Description |
|---|---|
| Platform Information | Identifies the platform originating the payout request and determines applicable processing rules. |
| Recipient Information | Identifies the recipient and links the payout to an onboarded participant. |
| Destination Information | Defines where funds should be delivered. |
| Payment Information | Specifies the payout amount, currency, and financial details. |
| Funding Information | Identifies the source of funds used for the payout. |
| Routing Information | Determines how funds will be delivered. |
| Compliance Information | Supports compliance, risk, and fraud validation activities. |
| Processing Instructions | Defines when and how the payout should be executed. |
| Tracking Information | Enables payout tracking, reporting, and reconciliation. |
| Notification Information | Supports event notifications and reporting activity. |
Processing Instructions
Processing instructions define how and when a payout should be executed.
Examples may include:
- Scheduled payouts
- On-demand payouts
- Transaction-triggered payouts
- Manual approvals
- Priority processing requirements
Refer to Payout Scheduling for detailed information about payout timing options.
Validation Checks
Before a payout can be executed, the platform may perform multiple validation checks.
| Validation Check | Description |
|---|---|
| Recipient Validation | Confirm the recipient is eligible to receive funds. |
| Destination Validation | Verify that the payout destination can receive funds. |
| Funding Validation | Confirm sufficient funds are available for payout execution. |
| Compliance Validation | Apply applicable regulatory and compliance controls. |
| Risk Validation | Evaluate fraud and operational risk controls. |
| Routing Validation | Confirm an eligible payout route is available. |
Payout execution occurs only after applicable validation requirements have been satisfied.
Compliance and Risk Controls
Before funds are released, payout processing remains subject to applicable controls.
Examples include:
- Compliance validation
- Risk monitoring
- Fraud screening
- Destination eligibility checks
- Balance verification
- Country and currency restrictions
These controls help support secure and compliant payout execution.
Routing and Delivery
Once approved for processing, the payout is routed to the selected destination.
The delivery experience depends on factors such as:
- Destination type
- Geographic location
- Currency
- Platform configuration
- Available payout capabilities
Recipients may receive funds through:
- FFP-enabled accounts
- Bank accounts
- Debit cards
- Digital wallets
- Cross-border payout destinations
How Payout Instructions Support the Payout Lifecycle
| Lifecycle Stage | Description |
|---|---|
| Initiation | Capture recipient, amount, destination, and processing requirements. |
| Validation | Verify recipient eligibility, destination information, funding availability, and compliance requirements. |
| Routing | Determine how funds should be delivered. |
| Execution | Initiate payout processing and track payout status. |
| Reporting and Reconciliation | Support visibility, tracking, reconciliation, and audit activities. |
Integration Approaches
Platforms may implement payout setup and management using different integration models.
| Integration Approach | Description |
|---|---|
| Embedded | Payout setup is embedded directly within the platform experience. |
| Hosted | Recipients are redirected to a Fiserv-hosted experience to configure payout destinations. |
| API | The platform owns the user experience and manages payout information through APIs. |
| Dashboard or Portal | Recipients manage payout preferences through a portal experience. |
The available integration options depend on the capabilities selected for the implementation.