When should the on_behalf_of parameter be used in a charge?

The on_behalf_of parameter is specifically designed for scenarios where a platform interacts on behalf of a connected account, particularly in reference to payments. When this parameter is used in a charge, it signifies that the funds from the transaction should be attributed to the connected account rather than the platform itself.

The purpose of this usage aligns closely with minimizing declines and avoiding unnecessary currency conversions. By routing payments through the connected account, which is often closer to the end customer and may have better local acquisition capabilities, the likelihood of payment declines is reduced. Additionally, if the connected account is set to handle transactions in the same currency as that of the end user, this configuration helps in avoiding currency conversions that might occur if the charges are processed through the platform's account.

Using the on_behalf_of parameter facilitates a smoother payment experience, enhancing the success rate of transaction approvals and ensuring that funds are captured more effectively. It cultivates a more direct line between the charge and the payment to the connected account, allowing for optimally managed transactions.