What is a Negative Limit?

When issuing a refund, if you see the notification Insufficient funds in gateway account that means that you have hit the Negative Limit on your TogetherPay account. When you hit your Negative Limit, TogetherPay contacts us to see if it needs to be raised. We will reach out to you to ascertain if the Negative Limit needs to be raised and to how much.

The Negative Limit is a security measure used so that if someone attempted fraud, they could only withdraw up to the Negative Limit and not drain your bank account.

When you process more refunds than payments that are received in a given day, that causes your TogetherPay account to run a negative balance. The Negative Limit sets the amount that you are able to go negative in your account (in essence the amount that you can overdraw your account). Here is an example of how it works with an account that has a $20,000 Negative Limit.

  • Today you refund $25,000 and take in payments of $5,000 which would mean that you would hit your Negative Limit of $20,000 on your TogetherPay account.
  • Tonight we would make a withdrawal from your bank of $20,000 that would go to settle your TogetherPay account.
  • Your Negative Limit would stay at $20,000 until one of the following two things happen:
    • Either more payments come in tomorrow to your TogetherPay account, which reduces your balance, OR
    • The $20,000 withdrawal is posted and hits our bank account in 2-3 business days
  • Once either of those things happen, then you can refund more money.

If you are processing a lot of refunds, then raising your limit allows you to process more in a given day rather than having to space it out over a couple of days to wait for either, more payments to come in or the withdrawal to post. After you have finished processing refunds, let us know and we can reduce your Negative Limit back to a normal amount as a security measure.