To avoid a 7-day waiting period for first payouts, what must a platform with Custom connected accounts do?

To circumvent the 7-day waiting period for initial payouts when dealing with Custom connected accounts in Stripe, the platform needs to generate at least one live charge. This requirement helps Stripe verify that the connected account is actively engaging with real transactions. When a platform generates a live charge, it signals that the connected account is legitimate, thereby facilitating a more rapid payout process.

Generating a live charge demonstrates that the account holds potential for activity, which can improve the confidence of the payment processor in disbursing funds more quickly. This is particularly important in maintaining a smooth cash flow for businesses that rely on timely payouts.

Other aspects, such as verifying accounts or confirming bank information, are part of standard compliance and security measures but do not directly impact the waiting period regarding payouts. Creating an active subscription plan may be beneficial for recurring revenue but does not address the immediate need to reduce the payout waiting time following the first charge.