Faire is such a dominant player on the retail scene that it was big news when they started to offer American retailers the option of paying through Plaid. Several shopkeepers have asked what this is, and whether using this ACH platform is a good idea. (If you’re not already familiar with the basics of ACH, which is also offered by many vendors for payments, check out the Specialty Shop Retailing blog post of July 22, 2024.)

One of the big selling points of ordering on Faire has always been the fact that invoices are usually paid by credit card on a net 60 basis. But of course every credit card has a spending limit – and it’s very easy to end up with enormously high interest rates if you don’t pay the entire balance on time. The current average is a staggering 24.20%! 

Using Plaid instead of a credit card will allow some retailers the opportunity to receive a significantly greater maximum spending limit. ACH (Automated Clearing House) functions more like a debit card, taking the money owed directly out of your bank account. But Faire’s delayed terms are still in place, so the company will not debit your Plaid-linked bank account until 60 days after you place an order (or, according to their website, “60 days after the ship date if fulfillment takes more than 14 days”).  In order to use Plaid, you complete a credit application and authorize a link between Faire and your business bank account. 

Plaid is a a fintech company (see the June 10, 2019 Specialty Shop Retailing blog post for details about fintech) that provides services and tools to facilitate Faire’s ACH transactions, verifying the account and routing numbers, and providing tools that minimize their risk. Vendors pay Faire a commission and payment processing fee, which I assume is used to pay the fee that Plaid charges for its services. There is no surcharge to retailers for paying via ACH.

I am happy to provide this information at the request of shopkeepers buying from Faire, but it is not a recommendation that you use the platform. As before, I’d suggest that whenever possible you check to see if a line is represented by an agency or sales rep before making that decision. However for those purchases that are made through Faire, it’s good to understand the payment options they offer.

Happy Retailing,
Carol “Orange” Schroeder