That something fishy is happening was clear to everyone somewhere in June 2019. But signs about Kinguin payout delay of payments to merchants were noticeable even at the start of 2019.
For those who don’t know, Kinguin is a sort of marketplace like eBay but for game keys. Just like Gamivo, Eneba, and G2A. I know there is a lot of misinformation and hate regarding this kind of marketplaces but most sellers are honest and it is in their best interest that customer is satisfied.
POPULAR GAME KEY MARKETPLACES
Kinguin Payout Delays
When you sell game keys, all marketplace platforms lock your funds for 7–30 days, before you can withdraw your money depending on the marketplace. In this way, they protect themselves in case the seller sells invalid keys and then tries to withdraw money and scam them. Kinguin used to lock seller funds for 30 days before you can process a payout.
Kinguin, as well as G2A, Gamivo, and others charge various fees for selling. That is how they earn money. When sellers sell key on Kinguin they get money on balance which is then in the review period for 60 days before they can use it (previously it was 30 days), and fees go to Kinguin. On May 13, 2019. Kinguin “professionally” updated their sellers via Reddit post about the new policy regarding payout review time.
Here is that announcment:
Hello everyone!
Thanks for your patience while we resolve this matter. We are announcing our new ‘review period’ policy. These updated terms will enable us to be timely with our payment schedule, so our valued merchants no longer see delays.
A key point in the new terms is that there will be a change in review period time up to 60 days. This will allow us to pay all of our merchants within the promised timeframe.
We understand that this delay and our updated ToS will impact our merchants. In recognition, we will offer the following perks to merchants, starting May 17th:
-Decreasing the commission by 10%* *Software Products not included
-Lowering the Listing Fee by 70%
-Increasing the Listing period from 60 to 365 days
-Lowering the price change fee by 80%
-Lowering Payout Fees by 50%
-Lowering Special Deals Participation fee by 20%
If you have any questions or feedback about the new Terms of Service, please contact us at [email protected]
They really did apply those changes. The changes were somewhat solid compensation for increasing the review period from 30 days to 60 days. Ok, after 60 days you can create payout and get your money. Wrong! What they didn’t mention is that you can create a payout after 60 days but when you will get it, thats another story.
Where Did Money Go?
It was clear Kinguin has a cashflow problem. But how platform which always made payments just a couple days after requested payout now couldn’t pay its sellers? Where did the money go? Did Kinguin illegally spend money which wasn’t theirs?
Some say Kinguin management made some really bad investments. And that was made with sellers’ money. Those are all speculations. But one thing is sure. Money did go somewhere. Even Kinguin CEO Viktor tried to find someone who will invest by post on Facebook. As it currently seems, he didn’t found his angel.
Kinguin also opened the gaming center so that is one option where the money went. Or maybe it went into their ICO (Kinguin Krowns) which was live for short time and then forever dissapeared. Kinguin even had to cut off its worldwide known CS:GO Kinguin E-sports team, 50+ employees and their marketing team.
Some sellers when noticed that Kinguin has cashflow issues starting buying available game keys on Kinguin from other merchants. The plan was simple, as you can’t get your own money from them, then you just buy stock from other merchants on wholesale using balance you have. You then resell those keys on G2A, Gamivo, Eneba, etc.
The problem with this is that they will mostly end in some kind of loss. Most marketplaces have the same or similar price so on top of fees it is hard to sell like that with profit. But many sellers still took that route because better to get something then nothing if Kinguin goes bankrupt or disappears with the money.
Why You Can’t Purchase Using Balance?
Kinguin noticed what sellers are doing and quickly disabled option to purchase more than few copies telling that it is temporary (I think in the end they entirely disabled wholesale part) and they are working on upgrading platform. That was, of course, a lie.
Very soon Kinguin also disabled option for purchasing via available balance telling another lie that it was temporary, they are making updates, etc. So sellers now cant spend their money which they have on Kinguin nor they can get it as a payout. Basically it is hostage situation operated by Kinguin.
UPDATE: Kinguin sent emails to several merchants in March 2020. telling them that for 2 weeks they will enable balance purchases. But they can only spend 100 EUR per day.
Kinguin Merchant Tiers
Because of this many merchants stopped selling on Kinguin. Kinguin at the time had only few sellers. Kinguin needs Merchants/Sellers and Buyers/End Customers and they lost almost all of their Merchant/Sellers base. To solve that issue Kinguin started to send emails to sellers who left offering them benefits if they start selling again.
Basically they say if merchants start selling again, they will pay what they owe quicker. So they are basically offering sellers own money as an incentive. What a nerve. Of course many have accepted that as what else to do.
Number Of Merchants On Kinguin
There was so small number of sellers on Kinguin that they had to start selling themselves. So they added seller which is their account to start selling to cover most game listings as they were empty.
Support will just ignore and rarely answer questions about payouts. And if they answer it will be something like “rest assured you will get your payment…”
Can Kinguin Get Back On Its Feet?
Kinguin traffic heavily decreased. According to SimilarWeb, it went down from 3,9 million monthly visitors in August 2019. to 2,5 million in January 2020.
It is clear Kinguin payout delay and cash flow issues represent big issues. Kinguin only issues payouts to merchants which returned to selling on Kinguin.
Kinguin support ignores messages, “account manager” ignores messages, money is held hostage with no clear correspondence or signs if merchants will ever receive it. There is no sign of professionalism nor care for merchants. Kinguin being not transparent and not giving any official statement makes the case more fragile on their end.
In fact, they are the ones who call the old money ‘debt’ offering nonsense partnership to merchants where they need to “work” (continue to sell) in order to get their money (if even then).
Unfortunately, it seems accepting their “offer” is only way to get what they owe you (and according to deal it can take years). Kinguin receives fees when merchants sell. But when it is Kinguin turn to pay, there is no sign of them.
When you sell the game key on Kinguin, money is stored on your account balance. And that is your money. Look at it as a bank account. You receive or deposit money and that money is on your bank account. When a certain period passes, you can withdraw that money. So when you create payout you receive that money in a matter of few days.
But now when you create payout you don’t receive money. Imagine going to the bank to withdraw your own money from your own account and the bank refuses or tells you they can’t pay. But you can create payout and wait for the possibility to maybe receive it somewhen in the future (though this is not far how banks operate nowdays).
Kinguin is doing exactly that. The fact is they don’t have money to pay. But how can’t they pay when that is merchant money stored in “bank account?” Did money disappear? It is a fact that Kinguin spent money which wasn’t theirs. And now they don’t have it.
Imagine real bank spending their client’s money. That is illegal. But Kinguin did that. Can they answer legally for that? Can you sue them?
I suggest checking alternatives such as websites like Kinguin which you can use instead.
UPDATE: Its been some time after this and we can see Kinguin is thriving again. They got out of the mess they created and many already forgot what was going on. For now, Kinguin is safe to use again for all sides.