What Is Payment Threshold And Why Should You Care About It?

In affiliate marketing, a payment threshold is the minimum amount of money an affiliate must have in his affiliate account in order to initiate a withdrawal.

While many merchants do not require their affiliate partners to have a certain amount in their respective accounts, many others require their partners to earn a certain amount of money from referral commissions to receive the payment from them.

On the other hand, there are many affiliate networks that set a minimum payment threshold which the affiliate marketers must meet in order to get paid.

Affiliate networks or platforms are affiliate marketplaces that bridge the gap between merchants and publishers or affiliate marketers. Read more about affiliate networks here.

In simplest terms, if you want to see the money you have earned and accumulated in your affiliate account, you need to meet the minimum payment threshold either set by the merchant you partnered with or the affiliate network you are registered with as a publisher.

How To Identify The Program’s Minimum Payment Threshold?

Payment thresholds can easily be identified if you are applying to the affiliate program. Most of the time, the payment withdrawal terms are mentioned clearly in the terms and conditions page of an affiliate program and you just need to read the fine prints to know about the minimum payment threshold.

For example, the merchant or the affiliate network might specify the payment threshold for withdrawal is $100. This implies that you won’t be able to transfer any amount accumulated during a predefined time period (usually, one calendar month or 30 days is set as the time interval) until you have accumulated at least $100 in your affiliate account.

Note that the minimum payment threshold can differ from one payment method to another, for example, an affiliate program can have a minimum payment threshold of $100 for PayPal withdrawals and $500 for wire transfers… This means that the payment method you chose will also affect the minimum payment value.

Once your commission amount reaches the payment threshold, you can either send a payment request to the merchant or affiliate network or you can initiate a withdrawal from the program itself.

When Can You Withdraw Your Money?

Some merchants have the auto-withdrawal option, which means any amount equal to or greater than the payment threshold gets transferred to the affiliate partner’s bank account. This means they will hold your amount until the payment threshold is met, and transfer the amount automatically to your bank account once the payment threshold is met.

On the other hand, there are some merchants and affiliate networks that allow affiliate partners to request a bulk payout at once and these merchants do not automatically transfer any amount accumulated unless an affiliate marketer sends them a payment withdrawal request.

However, the payment schedule might differ from one merchant to another. Even if you have reached the payment threshold, a merchant might require you to wait for 30 days or 60 days to be able to withdraw the money or get it automatically transferred to your account.

The merchants and networks need this time to validate a sale, and if the referred buyer requests a refund (and the request is accepted by the merchant) or returns a purchased product, or simply cancels the order within this period, you won’t get paid for the referred sale.

What Happens When You Cannot Meet The Minimum Payment Threshold?

Even if you can’t meet the payment threshold, do not lose your sleep. It is the responsibility of the merchant or the affiliate network to secure any amount which you have earned. In the case of not meeting the payment threshold, the accumulated amount will be rolled over to next month’s total.

Always read the fine prints of an affiliate partner agreement before you sign up for a program, check how the payouts are structured by the merchant or network, and compare commissions.

Read more about How To Find Affiliate Programs That Are Relevant To You before you start your first campaign.