Settlement And Reconciliation
As mentioned above, institutions not only help sub-merchants integrate the WeChat Pay API, but also settle transaction payments. So before getting WeChat Pay online, institutions should also know the settlement rules of WeChat Pay.
Fund Flow
The overall fund flow of WeChat Pay is described below.
As shown in the following figure, after an institution registers and gets assigned a merchant ID, two capital pools are available for this merchant ID: CNY pool and settlement currency pool.
After the users pay in merchant's stores or online stores, the transaction funds will be stored in the CNY pool of the merchant ID on the same day ("T" day).
On the "T+1" day, all funds stored in the CNY pool on "T" day will be locked, exchanged as foreign currency funds, and stored in the settlement currency pool.
Note: The "T+1" day is a calendar day, which means currency exchange is carried out every day regardless of weekends and holidays. As currency exchange also triggers bill generation, WeChat Pay will provide transaction bills of the previous day every day.
Note: Even though both capital pools are within the WeChat system, the capital flow is irreversible. In other words, once funds in the CNY pool enter the settlement currency pool, they can no longer return to the CNY pool.
After the transaction funds enter the settlement currency pool, the first layer of judgment logic will be triggered. The system will judge whether the total amount in the settlement currency pool has reached 800 USD or an equivalent amount in other currencies, and whether the day is a business day. If these two conditions are met, WeChat Pay will pay all the funds in the settlement currency pool to the institution's corporate bank account. If either of the two conditions is not met, no payment will be triggered.
After receiving the payment from WeChat Pay, the institution can verify the transaction amount of each sub-merchant based on the transaction bills (refer to section 2.3.2.2) provided by WeChat Pay and settle the paid funds to the sub-merchants.
Descriptions
WeChat Pay always generates the transaction bills of the "T" day on the "T+1" day, including records for all positive settlements (successful transactions) and negative settlements (successful refunds or completed revocations).
Once a transaction is recorded in a bill, the fund for this transaction will be settled to the institution or directly-connected merchant positively or negatively. Bills are generated before 10:00 a.m. (Beijing Local Time) every day, so it is advised to obtain the specific API after 10:00 a.m. After the request is successful, the Download Bill API will return bill content in the form of file streams, which can be saved directly as readable files.
Precautions
Bill checking of institutions/merchants should be based on the transaction bills provided by WeChat Pay. In case of inconsistency between bill records and system records, check whether the system records are correct first. Contact technical support or operation personnel of WeChat Pay to verify the WeChat Pay bills if it remains inconsistent.
Note: For a refund record in a bill, the current refund status is identified either as SUCCESS or PROCESSING. PROCESSING indicates that the refund has been negatively settled from the merchant side but has not arrived at the user’s end when the bill is generated. To avoid bill inconsistency, no future change of the refund status will trigger a status update for this refund record in the bill. Merchants only need to focus on whether a settlement has been completed on the merchant’s end without considering the status on the user’s end.
Settlement query capabilities
As mentioned above, WeChat Pay will pay an institution only if the total amount of the settlement currency pool reaches 800 USD or an equivalent amount in other currencies on a business day. As a result, in the early business phase, it’s very likely that settlement will not be triggered until many days later.
For this purpose, WeChat Pay provides institutions with the settlement query API, which can be used to query settlement information, including the amount of transaction funds that have not been settled, transaction records in specific days within a period, the amount settled, and the transaction dates for the settled funds. Institutions can match the settled funds with corresponding transactions based on the queried settlement information and transaction bills for specific dates.
