Terms of Service

1. Definitions

For purposes of these Terms:

• "Buyer" means an individual or entity initiating payment through ArosaPay.
• "Merchant" means an individual or entity receiving payment through ArosaPay.
• "Transaction" means a payment processed through ArosaPay and governed by the Transaction State Machine.
• "Secured Funds" means funds received from a Buyer and held pending transaction completion.
• "Approval" means Buyer confirmation authorizing release of Secured Funds.
• "Dispute" means a formal challenge to release of Secured Funds.
• "Reserve" means funds temporarily retained from Merchant payouts under Tier Policy.
• "Ledger" means the internal transaction accounting system recording immutable entries.

2. Role of ArosaPay

ArosaPay:

• Provides transaction processing infrastructure.
• Secures Buyer funds pending transaction completion.
• Applies structured release conditions.
• Maintains transaction records.

What ArosaPay Does Not Do

ArosaPay does not:

• Act as a buyer or seller.
• Guarantee product quality.
• Assume liability for goods or services.
• Provide funds safeguarding services unless explicitly licensed to do so in the relevant jurisdiction.

Funds are handled pursuant to operational safeguards and applicable law.

3. Transaction State Machine

All transactions follow defined states:

• INITIATED
• FUNDS_SECURED
• DELIVERED
• APPROVED
• DISPUTED
• REFUNDED
• PAID_OUT
• CLOSED

Funds movement is permitted only in accordance with these states. Each state transition is recorded in the transaction ledger with a timestamp, actor reference, and reason code. No fund movement occurs outside of defined state transitions.

4. Payment Initiation (INITIATED)

Upon Buyer payment authorization:

• Payment request is submitted to payment provider.
• Transaction remains pending until confirmation.

Payment Failure

If payment fails:

• Transaction terminates.
• No funds are captured.
• No obligations arise for either party.

5. Holding Funds (FUNDS_SECURED)

Upon payment confirmation:

• Funds are captured and recorded in the Secured Transaction Ledger.
• Merchant is notified that funds are held in custody.
• Merchant has no access to held funds.

Status of Held Funds

Funds held in the Secured Transaction Ledger:

• Are not treated as Merchant earnings.
• Are not accessible for payout.
• Are subject to dispute and inspection conditions.
• Remain isolated until state transition occurs.

Definitions

The terms "held", "in custody", and "secured" are used interchangeably throughout this Agreement and ArosaPay's product surfaces. All three refer to the FUNDS_SECURED state in the transaction state machine and the funds.secured webhook event in the public API.

6. Delivery & Inspection (DELIVERED)

Merchant marks delivery. The inspection period begins.

During Inspection

• Funds remain held in custody.
• No release occurs.
• Buyer may approve or dispute.

Failure to deliver within the agreed timeframe may allow Buyer cancellation and return of held funds.

7. Buyer Approval (APPROVED)

Buyer confirmation triggers the following ledger operations:

• Secured Transaction Ledger → Merchant Payable Ledger
• Secured Transaction Ledger → Platform Fee Ledger

Reserve Application

If Reserve applies, the Merchant Payable Ledger is split:

• Available balance (eligible for payout)
• Reserve balance (temporarily retained per Tier Policy)

Approval is final except where fraud or system error is subsequently identified.

8. Disputes (DISPUTED)

If Buyer opens a dispute prior to approval:

• Secured Funds remain isolated.
• Release is paused.
• Both parties may be required to submit evidence.

Resolution Outcomes

• Refund to Buyer: Secured Funds returned to Buyer funding source.
• Release to Merchant: Secured Funds released to Merchant Payable Ledger.

ArosaPay may request documentation from both parties. Dispute decisions are based on transaction evidence and policy. ArosaPay's determination is final except where law requires otherwise.

9. Refunds (REFUNDED)

Refunds may occur when:

• Buyer prevails in dispute.
• Merchant fails to deliver within agreed timeframe.
• System error occurs.

Refunds are processed back to the original funding source where possible. Processing times depend on the payment provider and are outside ArosaPay's direct control.

10. Payouts (PAID_OUT)

Merchant payouts:

• Occur only from the Merchant Payable Ledger.
• Follow defined payout schedules.
• May be subject to reserve withholding.

Payout Timing

• Is determined by Merchant tier.
• May be adjusted for risk management purposes.

ArosaPay is not responsible for delays caused by third-party payment providers or receiving financial institutions.

11. Reserve Policy

Certain Merchants are subject to reserve requirements.

Reserve Parameters

• Reserve percentage is determined by Tier Policy.
• Reserve is applied automatically upon Approval.
• Reserve is released after the defined hold period, provided no disputes or risk flags exist.
• Reserve balances are not interest-bearing unless required by law.

Details of reserve rates and hold periods are described in the Merchant Risk & Tier Policy Disclosure.

12. Merchant Tier & Risk Adjustment

Merchant operational parameters may vary by tier. Tier classification may affect:

• Transaction limits
• Reserve percentage
• Payout timing
• Inspection window duration

Tier determination is based on objective transaction metrics including dispute rate, delivery performance, and transaction volume. ArosaPay may adjust tier placement in response to risk indicators.

13. Fees

Platform fees are deducted upon Approval. Fees are:

• Transparent and disclosed prior to transaction initiation.
• Deducted from the Merchant Payable Ledger at the time of ledger split.
• Non-refundable except in case of system error.

Current fee schedules are available on the Pricing page and within the transaction flow.

14. Account Registration

• You must be at least 18 years old to create an account.
• You must provide accurate and complete registration information.
• You are responsible for maintaining the security of your account credentials.
• You must complete identity verification (KYC) to access full platform features.
• One person may not maintain multiple accounts.

15. User Responsibilities

All users agree to:

• Transact honestly and in good faith.
• Provide accurate descriptions of goods and services.
• Inspect delivered items promptly within the inspection window.
• Report issues honestly and with supporting evidence.
• Not attempt to circumvent the payment protection process.
• Maintain current and accurate contact information.

16. Prohibited Activities

The following are strictly prohibited:

• Fraudulent transactions or misrepresentation of goods or services.
• Manipulation of transaction states, dispute outcomes, or merchant ratings.
• Circumvention of payment protection mechanisms.
• Transactions involving illegal goods, services, or activities.
• Maintenance of multiple accounts by a single individual or entity.
• Collusion between buyers and merchants to defraud the platform.

Violation of these prohibitions may result in immediate account suspension, fund holds, and reporting to relevant authorities.

17. Account Suspension

ArosaPay may suspend or restrict accounts if:

• Fraud is suspected.
• Policy violations occur.
• Regulatory requirements demand action.
• Risk thresholds are exceeded.

During Suspension

• Funds may remain secured in the Secured Transaction Ledger.
• Payouts may be paused.
• Active transactions may be frozen pending review.

Suspension decisions are documented internally. Users will be notified of the suspension and any required remediation steps.

18. Limitation of Liability

To the maximum extent permitted by law, ArosaPay is not liable for:

• Product defects, quality issues, or fitness for purpose.
• Merchant misconduct, non-delivery, or misrepresentation.
• Buyer misuse of the inspection or dispute process.
• Indirect, incidental, or consequential damages.
• Losses arising from third-party payment provider failures.

ArosaPay's total liability in connection with any transaction is limited to the fees paid in connection with that specific transaction.

19. Security & Safeguarding

ArosaPay maintains:

• Segregated transaction ledgers separating secured funds from operating accounts.
• Encryption standards for data in transit and at rest.
• Role-based access controls with audit logging.
• Incident response procedures for security events.

Full details are described in the Security & Funds Safeguarding documentation.

20. Regulatory Compliance, Amendments & Contact

Regulatory Compliance

ArosaPay operates subject to applicable laws in relevant jurisdictions. Where required:

• Identity verification may be performed.
• Reporting obligations may apply.
• Transaction limits may be imposed.

Users agree to comply with all applicable laws in their jurisdiction.

Amendments

ArosaPay may update these Terms. Material changes will be communicated via email or platform notification. Continued use of the platform following notification constitutes acceptance of updated Terms.

Governing Law

These Terms are governed by the laws of the Republic of Kenya. Disputes shall be resolved in the competent courts of that jurisdiction unless otherwise required by law.

Contact

Legal inquiries:

legal@arosapay.com

Support:

support@arosapay.com