FROD balance isn't included in total balance

[brucealdridge]

Description

The Stripe Express Dashboard that WooPayments merchants use now has a separate "Future Refunds or Disputes" (FROD) balance.

Merchants can manually add to this balance for any reason. The purpose of the FROD balance is when future disputes or refunds are expected. This balance will be used first rather than other balances or withdrawals.

WooPayments currently has no knowledge of the FROD balance. When it is in use balances will be incorrect. It's worth noting that this is a similar problem to the reserved balance

For example: With a $100 pending balance, $100 FROD balance, and $0 available balance, a merchant refunds $50.

Total balance	Available funds	FROD balance (not visible in WooPayments)
Before Refund	$100	$0	$100
Expected	$100	$0	$50
Actual	$50	$0	$50

Additionally refunds and disputes that use funds out of the FROD balance will NOT have funds deducted from a future deposit.

This task requires a spike to understand the full implications of the FROD balance in WooPayments and if the FROD balance is available as an API.

Additional context

https://woocommerce.com/document/woopayments/fees-and-debits/preventing-negative-balances/ p6q7sZ-hJ2-p2

[haszari]

Merchants can manually add to this balance for any reason. The purpose of the FROD balance is when future disputes or refunds are expected. This balance will be used first rather than other balances or withdrawals.

@souravdebnath1986 @aheckler @dougaitken – do we expect that WooPayments merchants will be using this FROD balance regularly? i.e. adding funds to it. How do WooPayments merchants add these funds? Through Stripe dashboard, or is it more involved process?

If we expect this to be used often, we should raise the priority of this spike and improvements.

If we don't expect this to be used regularly, this can be low priority (or maybe even close / not supported). Marking as low for now.

[aheckler]

do we expect that WooPayments merchants will be using this FROD balance regularly?

Some will be. For example, Stripe gave us some simple stats on FROD balance usage so far just yesterday. See: p1730760658995899/1730760581.640519-slack-C9976E5MJ (For reference, the feature was enabled on Oct 16.)

The numbers are small so far, but of course, we did not announce this at all, so these are just people who've found it organically.

How do WooPayments merchants add these funds? Through Stripe dashboard, or is it more involved process?

Through the Stripe Express dash, yes. My doc on it has screenshots. Happy to hop on a call if you need additional context. :)

If we expect this to be used often, we should raise the priority of this spike and improvements. If we don't expect this to be used regularly, this can be low priority (or maybe even close / not supported).

My guess is that most merchants won't use this simply because A) we have no plans to announce it, and B) it lives in the Stripe dash, and the whole point of WooPayments is that you shouldn't need to go there hardly ever.

That said, I wouldn't be surprised if this turned out to be used widely among HVMs, simply because they're inclined to care more about the smooth functioning of their business, and more willing to use somewhat "advanced" features to do so.

[haszari]

Thanks for the refresher on the context @aheckler ! Based on your comment it sounds like it's worth prioritising this (i.e. a small maintenance project), maybe next sprint even. Bumped priority to medium.