What Is Multi-Party Settlement?
Splitting payments between drivers, fleets, and platforms
Intro
Multi-party settlement is a payment process that allows a single transaction to be automatically split between multiple parties — such as the driver, the fleet operator, and the platform provider. It ensures each party receives their designated share of the fare or fee in real time or during scheduled settlements.
Main Definition
In the taxi and transport payments industry, multi-party settlement refers to the automated distribution of funds from a single customer transaction to two or more recipients. For example, when a rider pays for a trip, the amount may be split between the driver (service fee), the fleet operator (vehicle/dispatch costs), and the platform (for processing fees). This removes the need for manual payouts and simplifies reconciliation across multiple entities. It also improves accuracy and transparency — especially important for platforms using Tap to Pay solutions or in-vehicle EFTPOS terminals.
Examples
A $100 fare is automatically split: $85 to the driver, $10 to the fleet operator, and $5 to the platform provider.
A rideshare app uses multi-party settlement to send driver payouts instantly while retaining a portion for platform and tax obligations.
CabFare’s EFTPOS for fleets includes built-in support for multi-party settlement, automating driver and operator payments.
Key Relationships
Payment Gateways: Enable secure routing of transactions to multiple recipients.
Merchant Accounts: Each party must be onboarded properly to receive funds.
Instant Settlement: Some systems support real-time fund distribution; others settle at scheduled intervals.
Compliance: Accurate records of splits support regulatory and tax reporting obligations.
Frequently Asked Questions
Who controls how the payment is split?
The split is determined by the platform or fleet operator based on their agreement with the driver and service providers.Is multi-party settlement instant?
It depends on the provider. Some enable real-time distribution; others process at the end of day or in batch settlements.Does this affect what the passenger sees?
No — passengers see a single total. All splits happen in the background via the payment infrastructure.
