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 instant approval, paid out to them 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.
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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, Visa asks Rain (our card issuer), and Rain answers in under a second by checking the funds parked in your collateral account and your card limit. 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. 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, the card issuer draws the settled amount from your collateral to cover the payment it made to 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 nothing to repay later and no interest, ever.
- 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.
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.
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FAQ
Is my balance sold or converted when I tap?+
No. Authorization only places a hold; your balance is spent later, at settlement, when the card issuer 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 can't tell the Peanut Card apart from any other Visa card.
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 repayment, no credit checks.
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. Declined or abandoned payments release the hold automatically, usually within minutes.
Can I spend more than I have?+
No. 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.
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.