Valuable On-line Trading Escrow

With so much trade being conducted over the internet today, escrows being used more commonly to hold funds.


Escrows on the internet have existed since the start of popular internet auctions but many of us are only just seeing relevance and use.

Escrow for on-line transactions


With any number of transactions online taking place between anonymous persons, where it may be hard to tell which country the various parties are based – it is hardly surprising that the issue of security of funds is questioned.


Home-working and freelance escrows


Many of us today work from home. And perhaps we submit freelance work to all parts of the globe without ever having met with the client. As with all international trade, the laws concerning transactions, facilities and methods of chasing arrears all differ, so it may be seen as a benefit to have an escrow account managed by a regulated and neutral third-party.


Escrow Custodian Services can receive the funds and disburse them online, inclusive of multiple disbursements as per the transaction agreement. The monies are held in an escrow account which is held by an authorised and independent third-party, with the monies being released once both parties verify the completion of the transaction.


If any dispute takes place then it is taken to dispute resolution.


In today’s world almost anything can be traded online, such as:


  • General merchandise
  • General online auctions
  • Commodities
  • Vehicles
  • Services
  • Intellectual property
  • Milestone transactions – such as services provided whereby payments are disbursed at agreed milestone intervals


With the increase in internet fraud, the European Union introduced the Payment Services Directive in November 2009. This allowed low-cost government-regulated escrow services to operate on the internet, and thereby to enhance security for online commercial transactions.

Buyer Beware

A number of bogus methods of escrow have been employed online, the main one being that in auctions the seller proposes a specific third-party escrow service which is actually a bogus service probably set up by the seller. Remember that the escrow service should be neutral and should not be “linked” to the seller. 

To learn more or to discuss a specific application (without obligation) call 0207 856 0129 and speak to a member of the Escrow Custodian Services team or email