Payment Solutions for Kitchen and Bathroom Showrooms

Kitchen and Bathroom Payments: Deposits, Staged Payments and Final Balances

A kitchen or bathroom project rarely involves one simple payment made at the point of sale.

The customer journey may include:

Design appointment → survey → quotation → signed agreement → deposit → manufacturing or ordering → delivery → installation → snagging → final payment

Each stage can create different payment requirements.

A showroom may take the initial deposit by card, collect a larger stage payment using a secure payment link and ask the customer to pay the final balance by bank transfer.

Another business may offer regulated customer finance.

A supply-only retailer may receive full payment before dispatch, while a supply-and-install company may collect money over several months as the project progresses.

The payment arrangement needs to work for:

• The customer
• The kitchen or bathroom business
• The installer
• Product suppliers
• The payment provider
• Any finance provider
• The project’s contractual milestones

A poorly structured payment journey can lead to:

• Confusing customer statements
• Unmatched deposits
• Delayed supplier payments
• Cash-flow pressure
• Disputes over project stages
• Unexpected refunds
• Chargebacks
• Rolling reserves
• Delayed settlement
• Merchant-account reviews
• Problems moving to another payment provider

The correct question is not simply:

Which card machine should a kitchen showroom use?

It is:

How should the business collect and record deposits, staged payments and final balances throughout the entire project?

This guide explains how kitchen and bathroom businesses can structure their payment journey, what payment providers may examine during underwriting and how to reduce avoidable disputes and reconciliation problems.

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Quick answer: What payment setup does a kitchen or bathroom business need?

Most kitchen and bathroom businesses need a combination of payment options rather than one payment method.

These may include:

• A showroom card terminal
• Secure payment links
• Online checkout
• Pay by Bank or bank transfer
• A virtual terminal for appropriate telephone payments
• Third-party customer finance
• Regulated Buy Now, Pay Later
• Project or invoice-based reconciliation
• Staged-payment reporting
• Refund capability
• A merchant account capable of supporting the business model and transaction values

The payment schedule should reflect genuine project milestones.

For example:

• Deposit when the customer approves the order
• Stage payment when bespoke goods are ordered
• Further payment before delivery
• Installation payment when work reaches an agreed stage
• Final balance after completion or an agreed sign-off point

There is no universal deposit or stage-payment percentage that suits every kitchen or bathroom project.

The appropriate structure depends on:

• Supply only or supply and install
• Bespoke or standard products
• Supplier payment terms
• Delivery lead time
• Installation responsibility
• Customer contract
• Cancellation rights
• Average and maximum project values
• Refund and dispute exposure
• Payment-provider conditions

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Merchant Advice Service is an independent UK payments information and provider-matching service with practical experience helping kitchen and bathroom businesses with card-payment requirements.

This is an area where payment-provider suitability can be influenced by transaction values, deposits, the time between payment and installation or delivery, refund exposure and the structure of the individual business.

The kitchen and bathroom payment journey

A useful payment setup follows the customer’s actual project.

1. Initial design or consultation

The business may offer:

• Free design appointment
• Paid design service
• Refundable design fee
• Survey fee
• Planning deposit

The customer record should explain:

• What the payment covers
• Whether it is refundable
• Whether it will be deducted from the final project
• Whether home measurement is included
• What happens if the customer does not proceed

Avoid processing a payment with a vague description such as:

Deposit

when it actually covers a non-refundable design service.

The invoice, payment reference and customer agreement should describe the same purpose.

2. Survey and measurements

A home survey may confirm:

• Room dimensions
• Plumbing
• Electrical requirements
• Walls and floors
• Access
• Installation complexity
• Appliance requirements
• Additional works

Any change between the showroom design and final survey should be recorded before a larger payment is collected.

3. Quotation and customer agreement

The customer should receive a clear description of:

• Products
• Design
• Appliances
• Worktops
• Sanitaryware
• Installation
• Removal of existing kitchen or bathroom
• Plumbing and electrical work
• Delivery
• Exclusions
• Expected timetable
• Payment schedule
• Cancellation and variation terms
• Complaints and snagging process

4. Deposit or order payment

The deposit may trigger:

• Supplier orders
• Manufacturing
• Reservation of installation time
• Purchase of appliances
• Worktop templating
• Other non-recoverable business costs

The deposit amount should be commercially justifiable and reflected accurately in the contract.

5. Manufacturing or product-order stage

Where products are made or ordered specifically for the customer, a further stage payment may be collected when:

• Final measurements are approved
• The design is signed off
• The supplier order is confirmed
• Bespoke manufacturing begins

6. Delivery stage

The business may collect another payment:

• Before dispatch
• Before delivery
• On delivery
• Following confirmation that the correct goods have arrived

The correct point depends on the agreement and business model.

7. Installation

Installation may involve:

• Business-employed installers
• Subcontractors
• Customer-appointed tradespeople
• A separate installation company

The payment documentation should make clear who is responsible for each part.

8. Snagging and completion

A small number of issues may remain after the main installation.

The agreement should explain:

• What constitutes practical completion
• How snagging is reported
• The period for resolving minor issues
• Whether a final balance remains
• Whether the customer can withhold an amount
• What happens if the parties disagree

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Supply only versus supply and install

Payment providers may assess these models differently because the business’s obligations are different.

Supply-only kitchen or bathroom business

A supply-only business may:

• Design the kitchen or bathroom
• Sell units and products
• Order appliances and materials
• Arrange delivery
• Allow customer collection
• Have no responsibility for fitting

Its transaction journey may end when the correct products are delivered or collected.

However, disputes can still arise over:

• Incorrect products
• Damage
• Missing items
• Measurements
• Bespoke specifications
• Delivery
• Refunds
• Product quality

Supply-and-install business

A supply-and-install business may also:

• Survey the property
• Design the project
• Coordinate trades
• Remove the old kitchen or bathroom
• Manage delivery
• Install units and sanitaryware
• Arrange plumbing and electrical work
• Complete remedial work
• Manage snagging

This creates a longer customer obligation and more opportunities for disagreements.

A payment dispute could concern:

• The products
• The design
• Measurements
• Installation quality
• Delays
• Damage
• Missing items
• Subcontractor responsibility
• Work left incomplete
• Snagging

MAS insight: Explain the complete model to the payment provider

Do not describe a supply-and-install business simply as:

Kitchen retailer

if the company also manages building works, subcontractors, plumbing, electrical work and installation.

The provider needs to understand:

• Who contracts with the customer
• Who receives the payment
• Who supplies the products
• Who carries out the installation
• Whether installers are employees or subcontractors
• Who is responsible for complaints
• How long projects remain unfulfilled

An incomplete description can lead to unsuitable pricing, transaction limits or later account reviews.

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Worked example: A £25,000 kitchen project

There is no universal payment schedule, but the following example demonstrates how a project might be linked to documented milestones.

This does not mean every business should use a:

20% deposit followed by three fixed stages

The payment structure should reflect:

• The genuine costs incurred
• Customer agreement
• Supplier commitments
• Project progress
• Cancellation position
• Product lead time
• Installation model

A stage description such as:

Second payment due six weeks after order

is less useful than:

Second payment due once final measurements have been approved and the bespoke product order has been confirmed.

The second version connects the payment to an identifiable project event.

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How much deposit should a kitchen or bathroom company take?

There is no universal legally required or commercially correct deposit percentage.

A business might consider:

• Cost of design work
• Cost of the customer survey
• Supplier deposit
• Bespoke manufacturing
• Appliance orders
• Installation scheduling
• Cancellation exposure
• Customer confidence
• Payment-provider requirements

A deposit should not be selected simply because:

Everyone in the industry takes 50%.

The business should be able to explain:

• Why that amount is needed
• What commitment it triggers
• What happens if the customer cancels
• Which part may be refundable
• Which costs have actually been incurred

Government guidance on fair consumer contracts warns against terms allowing a business automatically to retain excessive prepayments or cancellation charges that bear no reasonable relationship to its losses. Consumer terms must be fair and transparent. 

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Is a deposit automatically non-refundable?

No.

Calling a payment:

Non-refundable deposit

does not automatically make the entire amount legally retainable in every situation.

The result can depend on:

• Contract wording
• How the contract was formed
• Customer cancellation rights
• Whether bespoke goods were ordered
• Work already completed
• Costs incurred
• Whether the business or customer breached the contract
• Whether the term is fair

A business may be entitled to retain an amount reflecting genuine loss or work completed.

However, a blanket term allowing it to keep every payment regardless of circumstances may be unfair.

Kitchen and bathroom businesses should obtain appropriate legal advice when drafting:

• Deposit clauses
• Cancellation terms
• Stage-payment conditions
• Variation terms
• Refund policies
• Completion and snagging provisions

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Bespoke and made-to-measure products

Kitchen units, worktops, cabinetry, glass panels and other components may be:

• Made to order
• Cut to size
• Painted in a customer-selected finish
• Manufactured for a particular room
• Personalised

Certain change-of-mind cancellation rights can be different for genuinely personalised or custom-made goods.

However, bespoke status does not remove the customer’s rights where goods are:

• Faulty
• Not as described
• Unsuitable for the agreed purpose
• Incorrectly supplied

Government guidance confirms that personalised or custom-made items may be excluded from some change-of-mind return rights, but businesses must still provide remedies where goods are faulty or not as described. 

The contract should identify what is genuinely bespoke rather than labelling every product as:

Custom made and non-refundable

where standard products could readily be resold.

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Contracts agreed in the customer’s home

Kitchen and bathroom projects frequently involve:

• Home design appointments
• Surveys
• Sales discussions
• Contract signing at the property

Where the contract is made away from the business’s normal premises, additional information and cancellation requirements may apply.

Government guidance says off-premises sales can carry a 14-day cancellation right, subject to the type of contract and applicable exceptions. 

The position can be more complicated where the contract combines:

• Bespoke goods
• Standard goods
• Design services
• Survey work
• Installation
• Urgent work requested during a cancellation period

Do not rely on a showroom contract template if the actual sale is completed in the customer’s home.

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Online and telephone contracts

A kitchen or bathroom order may be completed:

• Online
• By telephone
• By email
• Through an electronic signature
• Following a remote design appointment

Distance-selling rules can require the business to provide prescribed information and a durable copy of the contract.

Government guidance states that businesses selling at a distance must confirm the contract in a form the customer can save and must generally deliver within 30 days unless another timetable has been agreed. 

The customer may also have cancellation rights, subject to the nature of the goods and services.

The business should record:

• Where the contract was concluded
• Date of agreement
• Information supplied
• Cancellation notice
• Customer request to begin services
• Bespoke-goods position
• Agreed delivery date

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Paying a kitchen deposit by credit card

Some customers specifically want to pay at least part of a kitchen or bathroom purchase using a credit card.

One reason is the potential protection provided by Section 75 of the Consumer Credit Act.

For eligible purchases, Section 75 can apply where the cash price is more than £100 and no more than £30,000.

The protection may apply even where only part of the purchase, such as the deposit, is paid by credit card. The legal conditions still need to be satisfied, including the relevant relationship between the customer, card issuer and supplier. 

Example

Complete kitchen contract: £20,000

Credit-card deposit: £1,000

Remaining amount paid by bank transfer: £19,000

Subject to the legal requirements, the customer may potentially have Section 75 protection in relation to the wider £20,000 purchase rather than only the £1,000 card deposit.

What this means for the merchant

The business should not view the card transaction in isolation.

It should retain evidence covering:

• Complete contract value
• Deposit
• Project scope
• Product specification
• Delivery
• Installation
• Customer communications
• Complaints
• Remedies offered

A dispute about a £1,000 card deposit could involve allegations relating to the entire project.

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Section 75 does not automatically apply to every project

The position can depend on matters including:

• Cash price
• Payment method
• Parties to the contract
• Whether an intermediary breaks the required relationship
• Who supplied the goods or services
• Whether the cardholder is the contracting customer
• How the finance or payment arrangement was structured

The business should not promise customers that:

Paying £1 by credit card guarantees full protection

in every situation.

Likewise, it should not design the payment journey for the purpose of preventing customers from receiving statutory protection.

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Debit-card chargebacks

Debit cards do not receive Section 75 protection.

Customers may nevertheless ask their bank to pursue a chargeback under the relevant card-scheme process.

Chargeback is different from Section 75.

From the merchant’s perspective, a debit-card dispute can still result in:

• A request for evidence
• Temporary deduction
• Reversal of the transaction
• Administration fee
• Further dispute stages

The business should retain the same quality of project evidence regardless of whether the customer paid using credit or debit.

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Taking payments in the showroom

A card terminal can be suitable for:

• Initial deposits
• Design fees
• Smaller supply-only orders
• Additional products
• Customer-present stage payments
• Final balances paid at the showroom

Benefits can include:

• Customer familiarity
• Immediate transaction result
• Chip-and-PIN authentication
• Printed or digital receipt
• Connection with EPOS or invoicing

However, the payment receipt should still be linked to:

• Customer
• Project number
• Invoice
• Payment stage
• Outstanding balance

A terminal receipt saying:

Sale: £7,500

does not establish whether the payment related to:

• Deposit
• Units
• Worktops
• Installation
• Final balance

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Secure payment links

Payment links can be useful when the customer is not present in the showroom.

Examples include:

• Paying a deposit after approving the design by email
• Paying a stage invoice
• Settling a variation
• Paying before delivery
• Paying the final balance remotely

The customer receives a secure link and enters their own payment details.

This can be preferable to staff collecting card details by telephone because:

• The customer enters the information directly
• Authentication can be applied where appropriate
• The payment can carry a specific reference
• The business avoids handling raw card data verbally
• The payment record can be linked to the invoice

Payment-link references

Use descriptions such as:

Project K1048 – second payment following final design approval

rather than:

Kitchen payment

A clear reference helps with:

• Reconciliation
• Customer statements
• Refunds
• Disputes
• Project management

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Telephone payments and virtual terminals

A virtual terminal allows authorised staff to enter card details for a telephone or mail-order transaction.

This may be useful in some circumstances, but it should not automatically be the default method for every remote payment.

MOTO transactions can carry different:

• Fraud exposure
• Authentication options
• Provider pricing
• Chargeback risk
• Security requirements

A secure payment link may provide a stronger customer-led payment journey where the customer can access email or text.

Where a virtual terminal is used, the business should:

• Follow provider security requirements
• Avoid writing down card data
• Restrict staff access
• Never retain the card security code after authorisation
• Link the payment to the project record
• Provide a clear receipt

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Pay by Bank and bank transfers

Larger project balances are often paid using:

• Bank transfer
• Open Banking or Pay by Bank
• Invoice-based bank payment

Potential advantages can include:

• Lower transaction cost
• Suitability for high values
• Direct bank-account payment
• Immediate or rapid confirmation with some services
• Clear payment reference

However, the business still needs controls.

Confirm the payment has actually arrived

Do not release products or treat a project stage as paid based only on:

• Customer screenshot
• Email confirmation
• Pending-payment message
• Telephone assurance

Verify receipt through the business bank account or trusted payment system.

Protect customers from invoice fraud

High-value home-improvement businesses can be targeted by criminals who alter payment instructions.

Controls can include:

• Confirming bank details at the start of the project
• Avoiding unexpected account changes
• Warning customers to verify changes independently
• Using consistent invoice branding
• Separating approval and account-detail changes
• Reviewing suspicious email activity

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Merchant Advice Service view

Kitchen and bathroom businesses are a useful reminder that a familiar high-street sector can still have a more complicated payment profile.

Large deposits, higher transaction values and a delay between taking payment and completing an installation can influence how a payment provider assesses the business.

Merchant Advice Service has previously helped a UK kitchen and bathroom supplier find alternative processing after its existing merchant facility was terminated. That experience is one reason we recommend explaining the full sales and fulfilment journey when approaching a new provider, rather than relying on the sector description alone.

Read our kitchen and bathroom supplier case study.

Which payment method should be used at each stage?

There is no universal answer.

The customer should understand:

• Amount
• Purpose
• Due date
• Payment method
• Effect of non-payment
• Remaining balance

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High-value card payments

Kitchen and bathroom payments can be materially larger than ordinary retail transactions.

A business may need to collect:

• £5,000
• £10,000
• £25,000
• £50,000 or more

The payment provider may want to understand:

• Average transaction
• Maximum transaction
• Customer-present or remote channel
• Product lead time
• Refund exposure
• Fraud controls
• Project evidence
• Financial strength
• Previous processing history

Do not split one genuine transaction into several smaller card payments merely to avoid provider limits or controls.

Where staged payments are used, each should correspond to a legitimate project stage.

For further detail, see the MAS guide to high-value card payments.

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What if a card payment is declined?

A declined payment does not always mean:

• The customer has insufficient funds
• The bank believes the merchant is fraudulent
• The provider does not support the sector

Possible reasons can include:

• Issuer security controls
• Unusual transaction value
• Incorrect card details
• Authentication failure
• Customer card limit
• Fraud screening
• Transaction restrictions

Do not repeatedly submit the same large transaction without understanding the decline.

Ask the customer to:

• Check the information
• Contact the card issuer where appropriate
• Use another legitimate payment method

Avoid coaching the customer to provide inaccurate transaction information.

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Customer finance for kitchens and bathrooms

Customer finance can allow the cost to be spread over an agreed term.

Potential products can include:

• Interest-bearing retail finance
• Interest-free promotional credit
• Deferred payment
• Buy Now, Pay Later
• Personal loan
• Other regulated credit

The kitchen or bathroom company may act as:

• The goods or services supplier
• A credit broker
• An appointed representative
• An introducer appointed representative
• A domestic premises supplier
• A business offering an exempt payment arrangement

The correct regulatory position depends on the activity and product.

A business carrying out regulated consumer credit broking generally needs the appropriate FCA authorisation or representative arrangement. The FCA distinguishes between primary brokers, secondary brokers, appointed representatives and introducer appointed representatives. 

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Finance discussed in the customer’s home

Kitchen and bathroom businesses often:

• Conduct surveys in the home
• Present quotations at the property
• Discuss finance during the visit
• Ask the customer to sign electronically

The FCA describes a domestic premises supplier as a business that sells or offers goods or services while physically present in the customer’s home.

Where regulated credit broking is carried out in connection with those sales, the permissions position can be different from a retailer operating only from a showroom or website. 

The FCA has previously identified growth in the use of introducer appointed representatives in home-improvement trades and highlighted the additional oversight risks where credit broking takes place in customers’ homes. 

Do not assume a showroom’s existing finance arrangement automatically covers every member of staff, sales channel or home visit.

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Buy Now, Pay Later regulation from July 2026

New UK rules for covered third-party Buy Now, Pay Later products came into force on 15 July 2026.

The new regime introduced FCA oversight and consumer protections including affordability checks, clearer information, complaint rights and support where customers experience financial difficulty. 

Covered third-party BNPL agreements entered into from that date can also receive Section 75 protection where the applicable conditions are satisfied. 

Domestic-premises exemption for regulated BNPL

The government decided that domestic premises suppliers would not require credit-broking permission merely to offer covered regulated BNPL products as a payment option. 

That exemption should be interpreted narrowly.

It does not mean every kitchen or bathroom business can arrange every form of customer finance without considering FCA requirements.

The business should confirm:

• Product type
• Finance provider
• Contracting entity
• Customer journey
• Where the sale takes place
• Staff activity
• Advertising
• Required permissions or representative status

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BNPL is not the same as every instalment arrangement

The following can have different legal and commercial treatment:

• Third-party regulated BNPL
• Interest-bearing retail finance
• Interest-free retail finance
• Deferred-payment credit
• Merchant’s own payment plan
• Deposit followed by project stage payments
• Payment after an invoice becomes due

A stage-payment schedule is not necessarily finance merely because the customer pays more than once.

For example:

20% on order, 30% when products are ordered, 30% before delivery and 20% on completion

may reflect the performance of one project contract.

However, allowing a customer to receive the complete kitchen today and pay over twelve months could involve a different credit analysis.

Do not decide the regulatory position solely by changing the wording from:

Finance

to:

Flexible payments

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Advertising kitchen finance

Finance promotions should clearly identify matters such as:

• Finance provider
• Business’s role
• Eligibility
• Representative example where required
• Interest
• Term
• Deposit
• Total amount payable
• Conditions
• Regulatory status

Avoid statements such as:

• Guaranteed finance
• Everyone accepted
• No credit checks
• Free money
• Completely risk-free
• Instant approval

The finance provider or principal should approve promotions where required.

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Customer finance and merchant payments are separate journeys

A finance application and a card payment are not the same transaction.

A project might involve:

• Customer card deposit
• Third-party finance for the main balance
• Customer-funded upgrade
• Final bank payment
• Refund through several methods

The business must know:

• Which party owes each amount
• When the finance provider pays the merchant
• Whether payment is made upfront or at a project milestone
• What happens if the project changes
• How cancellations are handled
• How refunds are divided
• Who manages complaints

Do not automatically refund a finance-funded purchase to the customer’s personal bank account.

Follow the finance provider and payment-provider instructions.

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Future-delivery risk

Kitchen and bathroom businesses can receive customer money weeks or months before the complete project is delivered.

This creates future-delivery exposure.

A provider may ask:

• How much money has been taken for undelivered projects?
• How far in advance do customers pay?
• What happens if a supplier fails?
• Can the business refund customers?
• Are customer funds used for another project?
• How long does installation take?
• What value remains unfulfilled?

Example

A business processes:

£500,000 during one month

But only:

£250,000 relates to completed or delivered projects

The provider may consider the remaining customer exposure, not only the monthly card turnover. Taking customer deposits before manufacture, delivery or installation can create future-delivery exposure, particularly where projects have long lead times or high transaction values. Our Future-Delivery Risk in Payments guide explains how deposits, stage payments and outstanding customer obligations can affect merchant-account underwriting.

MAS insight: Track unfulfilled value

The business should be able to report:

• Total customer payments received
• Value of goods delivered
• Value of installation completed
• Remaining unfulfilled balance
• Expected delivery dates
• Expected completion dates
• Customer refunds pending

This helps the company manage its own cash flow and may also support provider reviews.

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Why payment providers may assess this sector differently

Kitchen and bathroom businesses are not universally classified in one identical way.

A provider may consider:

• Supply only or supply and install
• Bespoke content
• Delivery period
• Customer deposit structure
• Installation responsibility
• Transaction values
• Financial accounts
• Refunds and chargebacks
• Trading history
• Customer contract
• Subcontractor arrangements
• Total unfulfilled value

One provider may be comfortable with a business model that another does not support.

MAS has previously helped a UK kitchen and bathroom supplier after its former merchant facility was terminated because that provider viewed the sector’s risk differently. Another provider assessed the application and approved it within approximately one week, subject to its own underwriting and terms. 

One past approval does not guarantee that another kitchen or bathroom business will receive the same outcome.

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MAS case study: Replacing a terminated facility

A UK kitchen and bathroom supplier approached Merchant Advice Service after its existing merchant facility was terminated.

The company could no longer collect customer card payments, creating an immediate operational problem.

MAS reviewed the business and introduced it to another provider whose approach to the sector differed from the previous provider’s.

The replacement application was approved within a week, allowing the business to resume card processing.

The full case study is available here:

Kitchen and Bathroom Supplier Merchant Account Case Study

The case demonstrates why businesses should not assume:

One provider’s risk decision represents the entire acquiring market.

It also shows why a replacement application should accurately explain:

• Business model
• Project values
• Payment schedule
• Fulfilment
• Processing history
• Reason for termination

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What will a payment provider ask?

A provider may request:

Business information

• Legal company
• Trading names
• Directors and owners
• Trading history
• Website
• Showroom locations
• Financial accounts
• Management accounts

Business model

• Supply only
• Supply and install
• Design only
• Trade supply
• Consumer retail
• Online sales
• Home visits
• Subcontractor use

Payment profile

• Monthly card turnover
• Annual card turnover
• Transaction count
• Average transaction
• Maximum transaction
• Card-present, ecommerce and MOTO split
• Consumer and commercial-card mix
• Customer countries
• Refunds
• Chargebacks

Project information

• Average lead time
• Maximum lead time
• Deposit percentage
• Stage-payment schedule
• Unfulfilled project value
• Supplier terms
• Installation duration
• Complaints process

Technical requirements

• Card terminals
• Payment links
• Virtual terminal
• Payment gateway
• CRM
• Accounting integration
• EPOS
• Recurring payments
• Customer finance
• Multi-location reporting

A stronger application presents this information coherently rather than waiting for the underwriter to discover it across several documents.

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Merchant category code and business description

The payment provider assigns or confirms the merchant category code based on the principal business activity.

A kitchen or bathroom business could involve:

• Furniture or home furnishings
• Building materials
• General contracting
• Plumbing
• Installation services
• Appliance sales
• Several combined activities

The business should not select a code merely because it appears easier to approve.

The application should describe:

• What customers buy
• Who supplies it
• Who installs it
• How revenue is divided
• Which activity is principal

An inaccurate description can affect:

• Pricing
• Scheme rules
• Risk assessment
• Transaction monitoring
• Future account reviews

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Settlement and working capital

A card payment being approved does not mean the full amount is immediately available in the business bank account.

The payment may pass through:

• Authorisation
• Capture
• Clearing
• Provider settlement
• Merchant payout

The provider’s timetable could be:

• Same day
• Next working day
• T+2
• Delayed
• Subject to a reserve
• Subject to account review

For a business that must quickly pay suppliers, the difference between:

Customer payment approved

and:

Usable cash in the bank

is important.

See the MAS guide to card-payment settlement times.

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Rolling reserves

A payment provider may retain an agreed percentage of processing as a reserve.

Example

Customer deposit: £10,000

Rolling reserve: 10%

New reserve retained: £1,000

Remaining amount before fees and other adjustments: £9,000

The business may already need to pay:

• Cabinet manufacturer
• Worktop supplier
• Appliance supplier
• Delivery company
• Installer

A reserve can therefore affect the ability to fund the project even where the card sale was successful.

Before accepting an offer, confirm:

• Reserve percentage
• Holding period
• Cap
• Release frequency
• Review date
• Treatment after closure

For more detail, see the guide to merchant account rolling reserves.

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Compare usable cash rather than the card rate alone

Consider two offers.

Provider A

• Lower card-processing rate
• 10% rolling reserve
• T+2 settlement

Provider B

• Slightly higher processing rate
• No reserve
• Next-working-day settlement

Provider A may have the lower invoice.

Provider B may make more working capital available for supplier payments.

The correct comparison is:

How much usable cash will reach the business, when, and at what overall cost?

Use the MAS guide to comparing card-processing quotes to normalise different offers.

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Installation disputes and chargebacks

A chargeback relating to a kitchen or bathroom project may not concern whether the customer authorised the card.

It can involve allegations that:

• Goods were not delivered
• The wrong units arrived
• Products were damaged
• Appliances were missing
• Worktops did not fit
• Installation was incomplete
• The business missed an agreed deadline
• The work differed from the quotation
• Remedial work was not completed
• A refund was promised but not paid

The business may need evidence covering the complete project.

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The payment record should follow the project record

Useful evidence can include:

• Original enquiry
• Design brief
• Survey
• Measurements
• Approved drawings
• Product specification
• Quotation
• Signed contract
• Variation orders
• Customer invoices
• Payment receipts
• Supplier orders
• Delivery notes
• Installation photographs
• Customer communications
• Snagging list
• Completion record
• Complaints correspondence
• Refund correspondence

A card receipt alone is unlikely to explain a six-month supply-and-install project.

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Design approval

Before ordering bespoke products, obtain clear approval of:

• Layout
• Measurements
• Colour
• Finish
• Handles
• Appliances
• Worktops
• Sanitaryware
• Taps
• Storage
• Installation scope

Approval might be recorded through:

• Signed paper document
• Electronic signature
• Customer portal
• Confirmed email
• Recorded version history

The approved version should be identifiable.

Do not rely on several contradictory PDF designs with no clear final version.

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Variations and additional works

Kitchen and bathroom projects often change after the original agreement.

Examples include:

• Customer selects a different worktop
• Additional electrical work is required
• Plumbing needs alteration
• Walls require repair
• Products are upgraded
• Delivery access creates extra cost
• Hidden problems are discovered

Each variation should record:

• Description
• Price
• Effect on timetable
• Payment due
• Customer approval
• Impact on the original balance

Use a separate payment link or invoice reference such as:

Variation 03 – additional electrical work

rather than adding an unexplained amount to the next stage payment.

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Taking the final balance

The final-balance point should be clearly defined.

Possible milestones include:

• Delivery completed
• Main installation completed
• Practical completion
• Customer sign-off
• Agreed snagging stage

Avoid relying on vague wording such as:

Final payment due when almost complete

The contract should explain whether minor snagging prevents the final balance becoming due.

The business also needs a fair process where:

• A genuine material defect remains
• The customer refuses payment for an unrelated reason
• Only a small remedial item remains
• The parties dispute whether work is complete

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Find Your New Processor

Snagging and withheld payments

A snagging process should identify:

• Issue
• Date reported
• Responsibility
• Proposed remedy
• Appointment date
• Completion
• Customer response
• Value in dispute

Where a customer withholds the complete final payment over a minor issue, the business should follow its contractual and legal process rather than attempting repeated card collections without permission.

Where a serious issue remains unresolved, the business should not treat a signed payment receipt as proof that the service was performed correctly.

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Refunds

Refunds can arise because of:

• Customer cancellation
• Product unavailability
• Supplier failure
• Incorrect goods
• Overpayment
• Project variation
• Installation complaint
• Duplicate payment

The business should understand:

• Who approved the refund
• Original payment method
• Amount
• Project stage
• Customer agreement
• Provider refund process
• Effect on settlement and reserves

Refund to the original payment method where required by provider rules and the circumstances.

Do not issue a cash or bank refund for a card payment merely because the customer asks, without checking the legitimate reason and provider process.

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Partial refunds

A partial refund should be linked to:

• Original transaction
• Project
• Reason
• Products or services affected
• Settlement report
• Revised outstanding balance

Example

Original stage payment: £7,500

Product removed from order: £800

Partial refund: £800

The revised project statement should show:

• Original contract
• Variation
• Refund
• Remaining balance

This prevents the customer and accounts team from working from different totals.

---

Cancellations and supplier costs

Where a customer cancels after the business has:

• Completed design work
• Conducted a survey
• Ordered bespoke units
• Paid a supplier deposit
• Reserved installation time

the company may have incurred genuine costs.

However, the business should not automatically keep every payment without considering:

• Contract
• Customer rights
• Costs avoided
• Goods that can be resold
• Work completed
• Whether the cancellation term is fair

Government guidance warns that excessive cancellation charges and automatic loss of all upfront payments can be unfair. 

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Integrated kitchen and bathroom payments

An effective payment setup can link the transaction to:

• CRM
• Customer
• Project
• Quotation
• Invoice
• Delivery
• Installation stage
• Outstanding balance
• Accounting software

The customer journey might be:

Design approved

↓

Invoice automatically created

↓

Payment link issued

↓

Payment confirmed

↓

Project stage updated

↓

Accounts reconciled

↓

Next project action released

This reduces manual errors and creates stronger project evidence.

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Payment references

Use a consistent structure.

For example:

Customer surname – project number – payment stage

Such as:

SMITH-K1048-DEPOSIT

or:

SMITH-K1048-PREDELIVERY

Avoid descriptions containing unnecessary sensitive personal data.

The reference should be understandable to:

• Customer
• Showroom team
• Accounts
• Installer
• Payment provider
• Dispute team

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Find Your New Processor

Split payments between separate businesses

A project might involve:

• Showroom
• Kitchen manufacturer
• Installer
• Worktop company
• Finance provider

Do not collect the full project payment into one company and informally distribute money to unrelated businesses without understanding:

• Customer contract
• Payment-services position
• Tax treatment
• Liability
• Refunds
• Chargebacks
• Provider permission

Where several parties need to receive money, use a properly structured payment or contractual arrangement.

Do not simply use one merchant account as a collection facility for several independent traders.

---

Installer and subcontractor payments

The customer may pay the showroom while the business later pays subcontractors.

The business should establish:

• Who contracts with the customer
• Who invoices
• Who is responsible for quality
• Who handles complaints
• Who refunds the customer
• Who bears the chargeback
• Who pays remedial costs

A statement saying:

The fitter is self-employed, so we are not responsible

may not reflect the customer contract or legal position.

Obtain legal advice on the supply and installation structure.

---

Multiple locations and salespeople

A larger kitchen or bathroom business may have:

• Several showrooms
• Home-based designers
• Regional installers
• Central accounts
• Online leads

The payment setup should control:

• Staff permissions
• Refund authority
• Discount approval
• Payment-link creation
• Virtual-terminal access
• Customer-data access
• Reporting by location
• Fraud monitoring

A salesperson should not be able to:

• Send payment links to a personal account
• Change business bank details
• Issue unlimited refunds
• View unnecessary card information
• Create unapproved variations

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Reconciliation checklist

For each payment, the business should be able to identify:

• Customer
• Project
• Invoice
• Payment method
• Gross amount
• Fees
• Reserve
• Refund
• Chargeback
• Net settlement
• Outstanding contract balance

At month end, reconcile:

Customer payments

↓

Provider settlement

↓

Business bank account

↓

Project ledger

↓

Accounting system

The project balance and payment-provider balance should not be maintained as unrelated spreadsheets.

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Find Your New Processor

Payment provider application checklist

Prepare:

Company and ownership

• Company details
• Directors
• Beneficial owners
• Trading address
• Showrooms
• Financial accounts

Business model

• Supply only or supply and install
• Products
• Customer type
• Subcontractor model
• Website
• Customer journey

Transactions

• Monthly turnover
• Annual turnover
• Transaction count
• Average payment
• Maximum payment
• Payment channels
• Card mix
• Customer countries

Fulfilment

• Average lead time
• Maximum lead time
• Deposit structure
• Stage payments
• Unfulfilled order value
• Supplier terms

Risk history

• Refunds
• Chargebacks
• Fraud
• Previous declines
• Previous termination
• Existing reserve
• Complaints

Technology

• Card terminals
• Gateway
• Payment links
• Virtual terminal
• Finance
• CRM
• Accounting
• Reporting

The MAS high-risk merchant account application guide explains how to prepare a more complex provider application.

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Changing payment provider

Do not terminate the existing arrangement before the replacement is:

• Underwritten
• Contracted
• Integrated
• Tested
• Ready to process
• Ready to settle

Confirm:

• Legal entity approved
• Full business model approved
• Average and maximum transaction approved
• Payment channels approved
• Final pricing
• Settlement
• Reserve
• Gateway
• Terminals
• Finance compatibility
• Refund process
• Reporting
• First payout

A salesperson saying:

We work with kitchen businesses

is not final approval.

---

What if the existing merchant account is terminated?

A termination notice should be handled carefully.

Record:

• Date received
• Effective date
• Reason given
• Payment status
• Payout status
• Reserve balance
• Refund capability
• Contract
• Data access
• Customer obligations

Do not:

• Hide the termination from the replacement provider
• Apply under another unrelated company
• Use someone else’s merchant account
• Misdescribe the business
• Use an inaccurate merchant category

The replacement provider will need an accurate explanation.

See the MAS guide to terminated merchant facilities.

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Find Your New Processor

Comparing provider quotations

Compare more than:

Card rate

Include:

• Consumer debit
• Consumer credit
• Commercial cards
• International cards
• Fixed transaction fee
• Authorisations
• Gateway
• Terminal rental
• Monthly fees
• Refund fee
• Chargeback fee
• Settlement
• Reserve
• Contract
• Integration
• Customer finance compatibility

A provider with a slightly higher rate may produce a better result if it offers:

• Suitable transaction limits
• Faster settlement
• No reserve
• Better reporting
• Stronger integration
• Relevant sector appetite

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Questions to ask a payment provider

Business approval

1. Do you support supply-only kitchen and bathroom businesses?
2. Do you support supply-and-install models?
3. Do you support home surveys and off-premises sales?
4. Are subcontractors acceptable?
5. What project information is required?

Payments

6. What maximum transaction can be approved?
7. Can we take deposits?
8. Can we take staged payments?
9. Are payment links available?
10. Is a virtual terminal available?
11. Can we take payment in the showroom and remotely?

Settlement

12. What is the payout timetable?
13. When does the first payout occur?
14. Are weekends included?
15. Can settlement be delayed?

Reserve

16. Is a rolling or fixed reserve required?
17. What percentage or amount?
18. How long is it held?
19. Is there a cap?
20. When can it be reviewed?

Integration

21. Can payments link to our CRM or accounting software?
22. Can each payment include a project reference?
23. Are partial refunds supported?
24. Can we report by showroom?
25. Can permissions be limited by user?

Contract

26. What is the initial term?
27. What notice is required?
28. Can prices change?
29. Is the terminal agreement separate?
30. What happens to reserves after closure?

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Kitchen and bathroom payment checklist

Before processing begins, confirm:

• Business model accurately described
• Customer contract reviewed
• Deposit terms clear
• Payment stages linked to milestones
• Cancellation rights addressed
• Bespoke-goods position explained
• Finance permissions confirmed
• Card-terminal setup tested
• Payment links tested
• Bank-payment verification process established
• Maximum transactions approved
• Settlement confirmed
• Reserve confirmed
• Refund process tested
• Reconciliation linked to project records
• Dispute evidence retained
• Staff permissions controlled
• Provider complaint route documented
• Replacement plan considered

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Find Your New Processor

Looking for a kitchen or bathroom payment provider?

Tell Merchant Advice Service:

• Whether the business is supply only or supply and install
• Average project value
• Maximum project value
• Monthly card turnover
• Transaction count
• Deposit percentage
• Stage-payment schedule
• Average project lead time
• Unfulfilled order value
• Showroom, online and MOTO requirements
• Payment-link requirements
• Customer finance arrangements
• Current provider
• Settlement timetable
• Rolling reserve
• Refund and chargeback history
• CRM, EPOS or accounting integrations
• Any previous decline or termination
• What you want to improve

MAS can help you:

• Explain the business and payment model clearly
• Identify information a provider may require
• Consider potentially relevant payment-provider routes
• Compare settlement, reserve and payment functionality
• Prepare a more complete application
• Understand quotations and contractual questions

Merchant Advice Service cannot guarantee:

• Merchant-account approval
• A particular card rate
• Reserve-free processing
• A specific settlement timetable
• Finance approval
• That every provider in the market will be compared

The relevant payment or finance provider remains responsible for underwriting, pricing, settlement, reserves, customer eligibility and final contract terms.