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Merchant Limits

Merchant Limits are a way to accept more orders, beyond the credit limits provided by Hokodo.

For technical details on Merchant Limits, see the API Reference: Merchant Limits.

Optional Feature

Merchant Limits are an optional feature that can be switched on for particular merchants.

Please discuss with your Customer Success Manager if you wish to use this feature, and you are not already.

Accept extra orders for a given buyer​

Hokodo allows you to top-up your buyer's credit limit at your own risk. You can apply limits for specific buyers called Merchant Limits. These are your limits for the buyers.

Scenarios:

  1. Hokodo's credit limit has been used in full, but the buyer is trying to place further orders. In this case, you can add a Merchant Limit of the size of the orders to accept them.
  2. Hokodo has rejected the buyer, perhaps for having overdue invoices. The buyer has assured you that they will pay soon, so you want to make an exception and let them proceed.

In both these scenarios, you can offer Unprotected Credit. When you capture these Deferred Payments, it adds Unprotected Capture. If the buyer has some remaining Hokodo-protected credit limit, this will be used first. The Deferred Payment will then be part protected. The unprotected value is not protected against non-payment by the Buyer, although our collections team will still attempt to recover the value from the buyer.

Merchant Limits apply on top of the Hokodo credit limit. A buyer with a Hokodo credit limit of €400 and a Merchant Limit of €200 can borrow €600 in total.

The Merchant Limit can enable orders to be accepted that our credit decisioning rejected. Our fraud decisioning is not overriden: we continue to reject the order if we detect suspicious behaviour, even if you have a Merchant Limit set up for that buyer. Learn more about our different risk engine here.

We will pay out to you on the same schedule as any other Deferred Payment. In the event that the buyer defaults, we will claw back the value of the order that is Unprotected Capture.

If you would like this enabled on your account, speak to your Customer Success Manager.

Accept extra orders for all your buyers​

It is also possible to set up a default Merchant Limit that applies to all buyers without Merchant Limits designated as above. The default Merchant Limit could be used to apply a tolerance to Hokodo's credit limit. Since it is not protected, we recommend you do not set up large default limits.