What Happens When You Pay With the Peanut Card?
When you pay with the Peanut Card, the merchant sees a completely normal Visa payment: an authorization decision in real time, with settlement in their own currency. Nothing in your account is sold or converted at the register. This page walks through what actually happens between the moment you tap and the moment your balance changes, and explains why the card shows up as a credit card.
A card payment has two phases
Every Visa payment, from any card in the world, happens in two steps:
- Authorization — the instant yes-or-no at the register or checkout.
- Settlement — the actual movement of money to the merchant, which the merchant's bank runs afterward.
When you tap your phone or enter your card number, the terminal asks the Visa network, and Visa asks Rain, our card program partner. Rain answers in under a second by checking the funds parked in your collateral account and your card limit. Rain is not a bank. If the answer is yes, a hold is placed for the purchase amount. At that moment nothing has left your account, and nothing has been converted or sold.
The merchant is paid in their own currency
The merchant never receives digital dollars. They are paid in their local currency through the Visa network, the same way they are paid for every other Visa card. From their side there is nothing unusual about the payment: no special terminal, nothing to set up, and no way to even tell how your card is funded.
That is the whole idea of the card: Peanut plugs your balance into the standard Visa rails, so any conversion is handled between you, Visa, and the card issuer, Third National. It never happens at the counter, and never involves the merchant.
When your balance is actually spent
Your balance changes in two steps that mirror the two phases above:
- At authorization, the purchase amount is held against the funds parked in your collateral account, and the transaction appears in your history right away.
- At settlement, Rain draws the settled amount from your collateral to pay the merchant. This is the moment your digital dollars are actually spent.
If a payment is declined or the merchant never completes it, the hold is released and the funds return to your balance automatically. You don't need to do anything. How Peanut Card funding works covers the collateral account itself in detail.
Why your receipt may say "credit"
At a technical level, the Peanut Card operates as a Visa credit card, so terminals and receipts may label it "CREDIT" and some checkout pages will list it under credit cards. That is a classification of how the card works on the Visa network, not a line of credit:
- Every purchase is backed by your own funds, parked in your collateral account.
- There is no interest, ever, and you cannot borrow.
- There is no credit check, and using the card does not build or affect a credit score.
If a terminal asks "credit or debit?", choose credit.
When a purchase settles for more than it held
Sometimes a merchant settles a purchase for more than the amount held at the register. A tip added after you pay is the usual reason. If your collateral is nearly empty at that moment, the extra amount takes your spendable card balance below zero, and your account owes the difference.
Your next top-up covers that difference first. The rest becomes spendable as usual. So a top-up can look smaller than you expected. Nothing is lost: the missing part paid for a purchase you already made.
For example, a purchase is approved for 45.91 USD and settles at 55.09 USD. Your spendable balance goes to -6.31 USD. Your next top-up of 41.91 USD covers the 6.31 USD, and 35.60 USD becomes spendable.
Paying in another currency
Your balance is held in digital dollars, so when a purchase needs a currency conversion it happens inside the Visa network:
- Purchases in US dollars: no conversion, no added fee.
- Purchases in any other currency: converted at the Visa exchange rate plus the 1% International Service Assessment (ISA), a Visa network fee that is passed through. Peanut adds no fee of its own.
FAQ.
Is my balance sold or converted when I tap?
No. Authorization only places a hold; your balance is spent later, at settlement, when Rain draws the settled amount from your collateral account. If the purchase is in a currency other than US dollars, the conversion happens inside the Visa network at the Visa exchange rate plus the 1% ISA.
Does the merchant know how my card is funded?
No. The merchant sees a standard Visa payment and is paid in their own currency through the Visa network. They never receive digital dollars and cannot tell that the payment is funded with digital dollars.
Do I have to pay anything back later?
No. The Peanut Card is classified as a credit card on the Visa network, but there is no credit line: every purchase is fully covered by your own funds in your collateral account. No borrowing, no interest, no credit checks. One case looks like a repayment: if a purchase settles for more than it held, your account owes the difference and your next top-up covers it first.
When does the money actually leave my account?
A hold is placed the instant the payment is authorized, and the funds are drawn from your collateral account when the merchant settles the charge. Reversal timing varies. If a declined or abandoned hold remains for a long time, contact support with the transaction details.
Can I spend more than I have?
Payments are approved only against the funds parked in your collateral account and within your card limit, which you can change anytime from the Card screen. The one way your balance can go below zero is a purchase that settles for more than it held, usually a tip added after you pay.
I added money but my card balance went up by less. Why?
A purchase settled for more than the amount held at the register, usually because a tip was added after you paid. That took your spendable balance below zero. Your next top-up covers the difference first, and the rest becomes spendable. Nothing was lost.
Does using the card build a credit history?
No. The credit label is a Visa network classification, not a loan product, so card payments are not reported to credit bureaus and don't affect any credit score.