Why payment for providers is not through CC ?

roni56roni56
in General

I am curious why payment has to be done directly to providers and not through CC ? Maybe this is already discussed, pardon me if its the case. Is it not easier to track and ban offenders if payment is done by card to CC ? They can even ensure reviews are given by people who have paid, reducing fake reviews which are created by provider itself using multiple accounts.

Comments

  • [Deleted User]WriterGF (deleted user)

    It's a good notion. I'd assume it has something to do with the expense to the site, plus the pros are not employees of the site, so maybe that is part of it too?

  • roni56roni56

    @WriterGF maybe you are right. But just because money is coming through a third party, does it mean third party is your employer ?

  • [Deleted User]MaverickLegend (deleted user)

    These requirements would have to be in place @roni56

    Now I’m not a lawyer but this is what I could find out. Again the notion of easier said then done.

    1. SSL/TLS Certificate: Install a valid SSL/TLS certificate to ensure secure data transmission.
    2. PCI DSS Compliance: Comply with the Payment Card Industry Data Security Standard (PCI DSS) to protect sensitive cardholder data.
    3. Encryption: Encrypt sensitive data, such as credit card numbers, using a secure encryption protocol.

    Payment Gateway Integration

    1. Payment Gateway: Integrate a reputable payment gateway, such as Stripe, PayPal, or (link unavailable), to process credit card transactions.
    2. API Integration: Integrate the payment gateway's API into the website to facilitate seamless transactions.

    Merchant Account Requirements

    1. Merchant Account: Establish a merchant account with a bank or payment processor to receive credit card payments.
    2. Business Registration: Register the business and obtain necessary licenses and permits.
    3. Tax Identification Number: Obtain a tax identification number (TIN) or Employer Identification Number (EIN).

    Compliance and Regulatory Requirements

    1. GDPR Compliance: Comply with the General Data Protection Regulation (GDPR) if the website processes payments from EU citizens.
    2. Card Brand Requirements: Comply with the requirements of card brands, such as Visa, Mastercard, and American Express.
    3. State and Local Regulations: Comply with state and local regulations regarding credit card transactions.

    Additional Requirements

    1. Clear Payment Terms: Clearly display payment terms, including refund and cancellation policies.
    2. Secure Payment Form: Use a secure payment form that protects sensitive cardholder data.
    3. Customer Support: Provide adequate customer support to handle payment-related issues.
  • MeltMyWayMeltMyWay

    A lot of people that pay for cuddles do not want any type of paper or electronic trail that they have partaken in professional cuddling

  • CuddleDuncanCuddleDuncan Mod
    edited January 2025

    This website is a social media site. It's not a cuddling agency. In legal terms Cuddle Comfort is simply providing a marketing service to the professional cuddlers. To put it another way, professionals are analagous to the advertisers on Facebook.

    The problems, costs and risks of converting from one to the other are legion, and well beyond the resources of a small site like CC.

    If you read Karma which you suspect to be fake or untrue in any way, please Report it.

    If you want to write Karma for a professional you have to have made a booking through the site first. The kind of people who would create sock puppets to write fake Karma are usually banned before they even get to that stage. The 15% fee charged by the site would make it uneconomic anyway.

  • JohnR1972JohnR1972

    @MaverickLegend
    Great list. I wish it could be pinned to address this question every few weeks when it come up like a new idea.

  • HollydollhugsHollydollhugs

    I agree with @CuddleDuncan. It would take way more time and money to be able to facilitate. The 15% could go up drastically and much more liability for the site. I’m sure they weighed all of these options before choosing the way they operate now.

  • JubalJubal

    Don't forget all the 1099 forms that the site would have to issue to pros - I'm sure that they would all love the additional tax reporting burden.

  • Mare_BearMare_Bear

    Pro cuddlers are independent contractors, not employees of CC

  • LadyVelLadyVel
    edited January 2025

    I've advertised on other cuddle sites and none of them have the session payment going though the site.
    They do usually require some type of fee to be paid directly to the site either by the cuddler or cuddlee. There is one thats requires a hefty deposit from clients that is actually the site's fee.

    From my understanding...
    Since this site is based in the UK, if payment was required through the site all payments would possibly have exchange/international fees also charged. The payment system would have to be updated and set up so payments could be sent to cuddlers. AND again because it is based in UK, the options for receiving payments would be limited.

    I agree with what @sage91436 said, most people scheduling cuddling sessions do not want a paper trail and would rather pay in cash or through payment apps. Many payment apps can't send/recieve payments internationally.

    @Jubal The IRS rules regarding Form 1099-MISC do not apply to foreign entities operating outside the US, so there is no requirement for CC to issue an IRS Form 1099 to independent contractors.

  • JohnR1972JohnR1972
    edited January 2025

    Pro cuddlers are independent contractors, not employees of CC

    Exactly, that is why CC would have to issue form 1099 (miscellaneous income) to pros in the U.S. rather than a W2 (if CC was collecting payment from clients).

    I’ve worked for years as an independent contractor. Where it gets messy with the IRS is when some companies (I am NOT talking about CC) essentially hire and “independent contractor” then take away their independence, essentially making them a regular employee who they can treat as an employee on every except taxes and benefits. There is a test to determine if someone is an “independent contractor” and some of the criteria includes whether you have flexibility on your work hours and work location.

    Because cuddle pros are free to book their appointments whenever and wherever they want, it would be very difficult for anyone to argue against them truly being independent contractors.

  • JohnR1972JohnR1972

    @LadyVel
    You make a lot of great points. I would add to your list the nightmarish headaches of dealing with refunds when someone books a cuddle with a pro then cancels (I’ve heard that happens every great once in a while with clients on here 😂).

    Collecting payments is EASY (once you have jumped through all the hoops @MaverickLegend listed above). Collecting money is all automated but if 10, 20 or 30% of your bookings are getting cancelled, issuing refunds is a very tedious, manual process and it would put CC between pros and clients when the pro claims the client cancelled too late or if the pro gets a bad vibe and cancels on the client. I can’t imagine Mark would want to be in the middle of every pro / client dispute as that would quickly turn into 2 or 3 full time jobs.

  • LadyVelLadyVel

    Ugh, yeah because at work we have to manually refund transactions. I hadn't even thought about that.

  • SoosonSooson

    Why add a headache that will cost time and money? And who will process payments and handle refunds? the moderators? for free?
    and besides I love the ability to cancel bookings without consequences and run around. I took advantage of that yesterday.

  • WestsideMarcWestsideMarc

    Sure, there are always ways to improve the site or try to make a wheel rounder, but there are so many other constructive ways that the platform could be improved (NOT A DIG ON CC!) I’m just saying this one just doesn’t ascend to the top of the list….

  • JubalJubal

    The IRS rules regarding Form 1099-MISC do not apply to foreign entities operating outside the US, so there is no requirement for CC to issue an IRS Form 1099 to independent contractors.

    @LadyVel I have to disagree. A foreign company that is "engaging in business in the U.S." generally must issue a 1099-NEC to any US based contractors who are US residents. Ever since the SCOTUS ruling on businesses collecting interstate sales taxes, the definition of a foreign entity "engaged in business" in a given state or in the US has been broadened quite a bit.

    While I don't have a dog in that proverbial fight, I would love to see it tested by a company like CC against the IRS. It would be a fun case to watch unfold.

  • TheFunCartelTheFunCartel
    edited January 2025

    @Jubal I could be wrong but I do not think pros on CC are contractors. CC is a website that certain people pay 15% of their booking to for the privilege to advertise their service and to access a base of potential customers who pay nothing to CC. I think the closest comparison would be a seller on Etsy or any platform that allows someone to sell on their site.

    Technically the enthusiast is the one who would be responsible for tax forms, if any, is my understanding in this situation as CC only has rules as to what can be done on the site and they are not the ones “hiring” and paying the pro for their services. But I think this is a question for a CPA. CC is technically providing an advertising service for pros to attract business.

  • JohnR1972JohnR1972

    @TheFunCartel
    I agree with you as things stand today where clients directly pay pros. However, if the idea expressed by the OP was implemented where clients paid CC who in turn paid the pros, it is my understanding, based on conversations with my CPA, that CC would have to start issuing 1099s.

    To be clear, I never asked him about CC and pro cuddlers, it was a general conversation about independent contractors and when 1099s were supposed to be issued.

  • [Deleted User]WriterGF (deleted user)

    This is all very interesting. I have done a lot of work for foreign publishers as a freelancer (companies in the UK, Poland and China, mostly) and have never gotten a tax form from any of them.

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