Billing & Accounting — Executive Summary

Audience: CFO, COO, platform owners
Purpose: Alignment on the billing business model, commercial terms, and operating processes
Status: Concept under review — prior to implementation
Technical documentation: BILLING.md (for the development team)

1. What the Billing Module Is

PostCash is a platform for issuing and distributing digital cheques (prepaid instruments) in USDC. The billing module is responsible for end-to-end accounting of financial flows within the platform, from collecting merchant fees to invoicing instance operators and generating settlement documents for distribution relationships.

The module serves three purposes:

1. Accounting — every fee charged and collected by the platform is recorded in an immutable ledger.
2. Invoicing — monthly invoices are issued to instance operators for infrastructure usage.
3. Merchant settlements — agency reports and settlement documents are generated for distribution transactions.

2. Business Model: Platform Revenue Sources

The platform generates revenue on two levels.

Level 1 — Infrastructure Fees (already implemented)

The platform charges a fee for each issued cheque. The fee is collected automatically from the merchant’s wallet when the cheque is funded.

Fee Type	Charged To	Collection Method
Issuance fee	Merchant	Collected automatically when the cheque is funded (blockchain)
Redemption fee	Recipient	Deducted from the cheque value upon redemption
Exchange markup	Recipient	Embedded in the FX rate
Fiat on-ramp fee	Recipient	Added to the bank transfer amount

Pricing plans are configured individually for each merchant through the fee tier system. The default rate is 2% plus a fixed component, with a minimum of 0.25 USDC per cheque.

Level 2 — Distribution Model (agency structure)

The instance operator (the Issuer) distributes physical cheque batches through merchant distributors. In this model, the cheque is treated as a product with a face value.

Key principles of the model:

• The merchant takes a batch of cheques on consignment, rather than purchasing it outright.
• The merchant sells the cheque to the end customer and immediately activates it, for example at the point of sale.
• The merchant settles with the Issuer for the face value of activated cheques once per settlement period, typically monthly.
• Unfunded or unsold cheques that are not sold within the allowed period are returned, and the merchant’s obligation is cancelled.

3. Distribution Model: Merchant Economics

Merchant compensation structure

The merchant receives income in two forms, intentionally separated for tax optimization purposes.

Form 1 — Agency commission (upfront, paid by the customer)

The merchant adds a small markup to the cheque face value when selling to the end customer. This is the merchant’s declared revenue and taxable base.

Example: a $100 USDC cheque → the customer pays €92.46 (at the FX rate plus a 0.5% markup) → the merchant remits €92.00 to the Issuer and keeps €0.46.

Form 2 — Retroactive bonus (post-settlement, paid by the Issuer)

After successful settlement for the period, the Issuer pays the merchant a bonus based on settled transaction volume. This bonus is a payment from a foreign legal entity and typically benefits from a more favorable tax treatment.

Example: settled volume of $10,000 USDC → 1.5% bonus → $150 USDC.

Combined merchant economics:

Item	Amount
Cheques sold	100 × $100 = $10,000 USDC
Collected from customers	€9,246 (at FX rate + 0.5%)
Remitted to Issuer	€9,200
Agency commission	€46 (declared revenue)
Retroactive bonus	$150 USDC
Total merchant income	~$200 equivalent (~2.0% of turnover)
Taxable base	€46 (agency commission only)

Legal structure

The model is structured as an agency agreement (principal — Issuer, agent — Merchant).

• The merchant sells on behalf of the Issuer, not in its own name.
• The merchant’s revenue equals only the agency commission, not the full sale price.
• The Issuer is incorporated in an offshore jurisdiction (UAE / BVI / Singapore) and is not a tax resident in the merchant’s operating countries.
• This is a cross-border B2B supply model: VAT in the merchant’s jurisdiction applies only to the agency commission under the reverse charge mechanism.
• The merchant remains fully responsible for its own local tax compliance. The platform assumes no liability.

4. Document Flow

Platform level (Platform → Instance Operator)

Document	Content	Frequency
Platform invoice	Total infrastructure usage fees for the month	Monthly
Fee ledger extract	Detailed breakdown by transaction	On demand / CSV

Invoice statuses: Draft → Issued → Paid / Overdue / Voided

Distribution level (Issuer ↔ Merchant)

Document	Prepared By	Content
Settlement statement	Issuer → Merchant	Amount due for activated cheques during the period
Agency report	Merchant → Issuer	Sales report and remitted amounts
Bonus notice	Issuer → Merchant	Retroactive bonus amount payable

5. Billing Modes

The platform supports two fee collection modes.

Mode	Description	Status
Automatic (on-chain)	Fees are collected immediately for each transaction via blockchain	Live
Invoice-based	Fees are accumulated and invoiced monthly	Planned

The mode is configured separately for each instance. Invoice-based billing is designed for large merchants with established settlement processes, removing the need to keep funds in the platform wallet at all times.

6. Access Control

Each billing function has a configurable access level. Permissions are assigned by role.

Platform-level roles: Owner, Administrator, Finance, Developer
Instance-level roles: Owner, Administrator, Finance, Viewer

Default principle: the Finance role has full access to all billing functions. Administrators can selectively restrict or expand access for each function through the permissions editor.

Financial actions requiring re-authentication (additional passkey confirmation):

• Invoice finalization and voiding
• Payment confirmation
• Changes to merchant credit limits
• Changes to merchant credit rating
• Manual credit freeze / unfreeze

7. Controls and Compliance

Immutability of financial records

The fee ledger is append-only. Historical records cannot be modified or deleted. This ensures integrity of the financial history and supports audit requirements.

Audit trail

Every administrative action involving financial data is logged: who made the change, when it was made, what was changed, and the before/after values. The log itself is not editable.

Reconciliation

The platform produces monthly reconciliation snapshots to compare actual collected fees with expected fees. Any discrepancies are flagged for manual review.

8. Current Implementation Status

Function	Status
On-chain fee collection	Live
Fee ledger	Live
Invoices (generation, draft, issuing)	Basic version live
PDF invoice	In development
Invoice email delivery	In development
Invoice payment confirmation	In development
Invoice-based billing mode	In development
Merchant settlement documents	Planned
Bonus notices	Planned
CSV export for accounting	Live

9. Open Questions for Approval

9.1 Pricing plans
Are the baseline fees approved? (Default: 2% + 0.25 USDC.) Are special terms needed for certain merchant categories?

9.2 Settlement period
The standard period is 30 days. Should exceptions be supported for major partners?

9.3 Retroactive bonus rates
What is the base bonus rate, and what volume tiers should apply for higher rebates? (The draft documentation assumes 1.5%, with a $50k/month threshold.)

9.4 Payment delinquency
What should be considered overdue? What is the collection procedure? Should shipment of new cheque batches be blocked automatically?

9.5 Issuer jurisdiction
Has the Issuer’s incorporation jurisdiction been confirmed? This affects the legal structure of the agency agreements.

9.6 Settlement currency
Which currencies will merchants use to settle with the Issuer? Who sets the FX rate, and as of what date?