For platform founders and payment leads, reconciliation is one of those topics that’s often underestimated, until it breaks. And when it breaks, it doesn’t just cause accounting headaches. It eats time and margins, slows growth, and creates trust issues with submerchants.
In our previous blogs, we explored how traditional payment systems weren’t built for platforms. But nowhere is that more evident than in reconciliation. This post unpacks what goes wrong, and how Rootline solves it.
What is reconciliation?
Reconciliation is the process of ensuring that your platform’s financial records accurately reflect what’s happening in reality. In payments, this means matching payment records across systems. This process is essentially the same for every party in the payment value chain, whether you are a PSP, a platform or a seller.
A payment happens and gets logged in your platform.
Funds are paid out to one or more accounts.
You receive one or more reports from your PSP.
Your team tries to match:
The payout to the report
The report lines to your internal records
This should be simple. But it’s not. In fact, reconciliation is one of the biggest operational pain points for platforms and their users.
Why it’s so hard
Let’s be direct: most platforms don’t fully reconcile. Even large, well-funded ones. We’ve seen platforms where 2–3% of payment volume is effectively unaccounted for each month. Not due to fraud or chargebacks, just unmatchable data. That’s money sitting in limbo.
This has real consequences:
Direct financial loss: unreconciled revenue can’t be claimed.
Increased ops costs: big reconciliation teams are needed just to keep up.
Slower growth: more transactions mean more chaos.
Erosion of trust: submerchants notice missing or unclear payouts.
Why does this happen?
The real issue: multiple systems, multiple truths
Most legacy PSPs were built for single-merchant use cases. But platforms are multi-party by design. That creates cascading complexity:
In a traditional setup:
A payment is processed.
Splitting happens in a different system.
Two reports are generated: one from the processing system, one from the platform system.
Your team now has to reconcile your internal records against two external “truths”.
And it gets worse:
Split payments might require separate balance transfers disconnected from the original payment.
Reports don’t always align with payouts.
Some accounts don’t get reports at all, or only have net amounts.
Report lines aren’t linked back to the original transactions, so tracing funds is nearly impossible.
Fees charged in the processing system are booked lump-sum to the platform system, making the puzzle much harder.
You might need a third-party system just to make sense of the data.
The result? Manual work and gaps in your ledger.
A simpler, unified approach with Rootline
Rootline was built from scratch for platforms and their sellers. That means we designed reconciliation to be simple and automatic.
In Rootline:
A payment is made.
Splits, fees, and routing happen within the same system.
For each account, one report is generated that reflects every mutation on it.
Each payout matches the report. Each report line matches a transaction in your system.
The result? One system, one source of truth, exhaustive reports and effortless reconciliation.
Handling refunds the right way
Most systems can handle this simple case ok, but truly fall apart once additional complexity is introduced. Let’s look at refunds as an example.
In traditional setups, a refund often lacks the full context of the original transaction. The money may be deducted from a generic platform account because the system doesn’t know where it came from. To “correct” this, platforms use balance transfers, a workaround that introduces new complexity:
You need extra logic and API calls.
Your reports are cluttered with unrelated transfers.
Submerchants see unexplained adjustments, increasing support requests.
With Rootline, refunds are native. Since all data lives in one system, a refund knows exactly which accounts were involved and what fees applied. You can issue the refund with a single call, and it’s automatically reflected in both your books and your submerchant’s report.
No hacks. No transfers. No confusion.
Scaling with confidence
With Rootline:
Reconciliation is a feature, not an afterthought.
Modifications are clean, simple, and transparent.
Reports are unified and accurate.
Your team spends less time firefighting, allowing you to scale.
If reconciliation has become a bottleneck, or you’re bracing for it to become one, it’s time to rethink your infrastructure.
Want to learn more?
Explore Rootline in more detail or speak to our team to see how it can support your platform.
