How escrow works on Open Lance

Escrow is the single idea the rest of Open Lance is built on. Nobody starts work on a promise, and nobody hands over finished work hoping to be paid. The money is committed up front, held by Open Lance, and released when the work is approved.

This article explains the whole path: where your money physically sits at each stage, who is able to move it, and what happens when the two sides disagree.

The short version

1. The client funds the work. The money leaves their card and is held by Open Lance.
2. The freelancer does the work, knowing the money is already committed.
3. The freelancer submits the work.
4. The client approves it.
5. The money moves to the freelancer's wallet.
6. After a short clearance period, the freelancer can withdraw it.

The important part is step 1. Work should never begin before it happens. If you are a freelancer and someone asks you to start before the money is funded, you have no protection, and Open Lance cannot help you recover payment for work it has no record of.

Where the money actually is

People picture escrow as a vault, which is close enough, but the detail matters when you are trying to work out why a number on your screen is what it is.

When a client funds work, the charge goes to their card immediately and the money arrives in their Open Lance wallet. It does not stay loose in that wallet. It is immediately reserved against the specific piece of work it was funded for, and a reservation cannot be spent on anything else, withdrawn, or quietly reused for another contract.

That is why a client's wallet shows two figures:

• Available is money you have loaded but not yet committed to anything.
• Reserved is money committed to specific work in progress. It is spoken for.

On the freelancer's side there are also two figures, and they mean something different:

• Pending is money that has been released to you but is still in its clearance period.
• Available is money you can withdraw right now.

A very common support question is "the client approved, so why can't I withdraw yet?" The answer is almost always that the money is sitting in Pending, working through clearance. It is yours. It is simply not withdrawable for a few more days. See How and when you get paid for that side in full.

What the client pays, and when

The card is charged at the moment work is funded, not when it is approved. What gets charged is the amount of the work plus the fees shown on the funding screen before you confirm:

• An escrow handling fee, a percentage of the funded amount plus a small flat amount. It covers the real cost of taking and holding a card payment.
• A contract initiation fee, charged once when a contract is first funded, not on every milestone after it.

Both are itemised on the checkout screen before you pay, and both appear on the receipt that is emailed to you and kept in your billing area. We do not quote the current rates here on purpose: they are configurable and would go out of date in this article long before anyone noticed. The figures on your checkout screen are the live ones, always.

If you are not paying in US dollars, the amount you are charged is shown in your own currency and your card is charged in that currency, so your bank does not add a conversion of its own. Every line you see already includes the cross-border cost, so the price you read while browsing is the price you pay at checkout.

Approval, and the two ways money is released

When a freelancer submits work, the client has a decision to make, and there are two release modes.

Instant release moves the money to the freelancer immediately on approval. It is the right choice when you have worked with someone before or the deliverable is plainly complete. In exchange for speed, approving instantly closes the dispute window on that piece of work: you are declaring it done.

Clearance release, sometimes called the grace period, moves the money to the freelancer but holds it for a short window first. The work is approved and the freelancer knows they are being paid, but there is a short period during which a problem can still be raised.

If the client does nothing at all, the work auto-approves after a set number of days and releases normally. This exists so a freelancer is never trapped by an unresponsive client. The countdown is visible on the contract, and the client is emailed before it runs out. Auto-approval is not a loophole for delivering poor work: it can still be disputed.

Hourly and monthly work are funded differently

Fixed-price work is funded milestone by milestone. Two other models fund on a rolling basis, and they confuse people who expect the milestone pattern.

Hourly contracts hold a weekly buffer rather than a single lump. When the contract starts, the client funds a buffer sized to the hourly rate multiplied by the agreed weekly hour limit. The freelancer logs hours in the work diary during the week. At the end of the week the client approves the hours, the approved amount is released from the buffer, and the buffer is topped back up from the client's card for the following week. Unused buffer is refunded when the contract ends or is paused.

Monthly engagements work the same way over a longer cycle, holding a multi-month reserve so a retainer is never one missed payment from collapsing. Each month settles at the cycle boundary and the hold is topped back up.

In both cases the underlying promise is identical: work is never performed against money that has not already been committed.

What happens when something goes wrong

The client is unhappy with the work. Ask for a revision first. Most contracts include an agreed number of revisions, and most problems are a misunderstanding rather than a failure. Revisions keep the money in escrow while the work is corrected.

Revisions do not fix it. Either side can raise a dispute, within a window that runs from the milestone event. Raising a dispute freezes the escrow immediately: the money stops moving in either direction until the dispute is resolved. Neither side can force it out. A mediator reviews what both parties submit and decides an outcome, which can be a full release, a full refund, or a split. Larger settlements require a second reviewer to approve them before anything moves.

The client disappears after work is submitted. Auto-approval protects you. The clock is already running from the moment you submitted.

The freelancer disappears before delivering. The money is still in escrow and has not been paid out. Contact support and it can be returned to you. This is the exact situation escrow exists to prevent.

A payment fails on a rolling contract. On hourly and monthly contracts, if the top-up charge fails, the freelancer is still paid for work already approved out of the funded buffer, and the contract pauses rather than continuing unfunded. Both sides are notified. Reactivating it funds the buffer again.

Cancelling, and getting money back

Money that is funded but not yet released is recoverable. Money that has been released and approved is not, because it has already been paid to somebody for work you accepted.

Before any work is submitted. If both sides agree to call it off, the funded amount is returned to the client's wallet, from where it can be withdrawn back to the card or spent on other work on the platform. Fees already charged on the funding are not automatically returned, because the payment was genuinely processed.

After work is submitted but before approval. This is a negotiation rather than a button. Talk first. If you cannot agree, it becomes a dispute and a mediator decides.

After approval. Approving is the point of no return, which is exactly why approval is a deliberate action rather than something that happens quietly in the background. If you approved by mistake, contact support immediately — the outcome depends on whether the money has cleared, and the sooner it is raised the more can be done.

On hourly and monthly contracts the same principle applies to the buffer: unused buffer comes back, approved and released hours do not.

What escrow does not do

It is worth being clear about the edges, because escrow is sometimes assumed to be a broader guarantee than it is.

Escrow does not judge quality. It holds money and enforces a process. If work is delivered and you approve it, the money moves — escrow has no opinion about whether the work was good, only about whether you said it was acceptable.

Escrow does not cover work done outside the platform. If you agreed extra work in messages and it was never funded, there is nothing held against it.

Escrow does not extend indefinitely. Disputes have a window that runs from the milestone event, and once it has passed, an engagement is settled.

Why work outside escrow is a bad trade

Every so often someone suggests moving a payment off the platform to avoid fees. It is worth being blunt about what that costs you.

There is no record, so there is no dispute process, no mediation and no refund. Open Lance cannot recover money it never held, and cannot verify work it never saw. The reviews and reputation that make future work easier to win do not accrue. And it is a breach of the terms both sides agreed to, which can cost you the account.

The fee is the price of the guarantee. Off-platform, the guarantee is simply gone.

Where to look in your account

• Clients can see everything in escrow, per contract, under Escrow in the client workspace.
• Freelancers can see funded work and what has been released under Escrow and Earnings.
• Both sides see the full history of a single engagement on the contract page itself.

If a figure does not look right, the contract page is the place to start, because it shows the funding, the approvals and the releases in order. If it still does not make sense after that, open a ticket with the contract reference and a person will go through it with you.