I am looking for advice surrounding a website that I have built and am about to launch.
The website is very similar to Upwork.com but it is based in Australia and is for Australian freelancers only.
My main concern is whether or not I will need a Financial Services License to hold money in an escrow account (which is actually being held by PayPal).
This is how things work to a freelancer or an employer:
- When a project is awarded to a freelancer, the employer pays the full project cost
- The money is held by the website until the project is completed successfully
- When the employer gives the go ahead, the funds are released to the freelancer
- The website takes 6% of the project cost
This is how it actually works in the backend of the site:
- The employer pays the project costs, which go directly into the website's PayPal account
- When the project is completed successfully, money is then transferred out of the PayPal account and into the freelancers PayPal account
So it appears as though the website is holding the funds, but in fact it is PayPal. The website is basically the middleman and the provider of the service.
So would I need a license for this?
The website is very similar to Upwork.com but it is based in Australia and is for Australian freelancers only.
My main concern is whether or not I will need a Financial Services License to hold money in an escrow account (which is actually being held by PayPal).
This is how things work to a freelancer or an employer:
- When a project is awarded to a freelancer, the employer pays the full project cost
- The money is held by the website until the project is completed successfully
- When the employer gives the go ahead, the funds are released to the freelancer
- The website takes 6% of the project cost
This is how it actually works in the backend of the site:
- The employer pays the project costs, which go directly into the website's PayPal account
- When the project is completed successfully, money is then transferred out of the PayPal account and into the freelancers PayPal account
So it appears as though the website is holding the funds, but in fact it is PayPal. The website is basically the middleman and the provider of the service.
So would I need a license for this?