> ## Documentation Index
> Fetch the complete documentation index at: https://developer.tazapay.com/llms.txt
> Use this file to discover all available pages before exploring further.

# Payouts on behalf of

> Learn about Payouts on behalf of

Tazapay’s **Payouts on Behalf Of (POBO)** capability allows platforms / fintechs to initiate payouts on behalf of their customers which can be individual or business.
This ensures compliance, traceability, and correct attribution of funds.

***

## High-level Flow

1. Create an **Entity** (Individual or Business)
2. Create a **Beneficiary**
3. Create a **Payout** using the Entity + Beneficiary
4. Handle **Payout Events / Webhooks**

<img src="https://mintcdn.com/tazapay-58ae360f/HTaQvRT5qoQLk5bt/images/diagrams/pobo.png?fit=max&auto=format&n=HTaQvRT5qoQLk5bt&q=85&s=e76051365d966b1d2b25976b59e0ac83" alt="POBO flow" width="1026" height="1676" data-path="images/diagrams/pobo.png" />

***

## Step 1: Create an Entity (Individual or Business)

An Entity represents a platform's or fintech's customer — the party on whose behalf the payout is being made. Every payout must be associated with an entity.

Tazapay supports two entity types:

* Business Entity – for registered companies
* Individual Entity – for individual customers (e.g., freelancers, creators, sole proprietors)

⚠️ Only entities with status **submitted** can be used to create payouts.

### Relevant Links

1. [Business Entity Requirements -  Full Onboarding](/getting-started/overview/onboarding-requirements)
2. [Individual Entity Requirements - Full Onboarding](/getting-started/overview/onboarding-requirements)
3. [Entity Requirements - Simplified Onboarding](/Global-Money-Movement/connected-accounts/simplified-entity-creation)
4. [Create Entity API](/api-reference/tazapay-api/create-entity)
5. [Submit Entity API](/api-reference/tazapay-api/submit-entity-business)

***

## Step 2: Create a Beneficiary

A **Beneficiary** represents the **recipient of funds**.

This can be:

* An individual
* A business

The destinations supported are

* Bank account
* Mobile Wallets
* Local Networks or Proxies
* Stablecoin Wallets
* Another Tazapay account

### Relevant Links:

1. [Create Beneficiary API](/api-reference/tazapay-api/create-beneficiary)
2. [Payout Metadata Bank API - This API lists the beneficiary requirements and transfer limits based on destination country and currency](/api-reference/tazapay-api/payout-bank)

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## Step 3: Create a Payout

Once you have:

* A **submitted entity**
* A **created beneficiary**

You can create a payout using the Tazapay API and attach the entity and beneficiary.

### Relevant Links:

[Create Payout API](/api-reference/tazapay-api/create-payout)

***

## Step 4: Handle Payout Events & Webhooks

Tazapay sends **webhooks** to notify you of payout state changes. You should always rely on webhooks (not polling) for final payout outcomes.

### Relevant Links:

1. [Payout State Machine](/api-reference/tazapay-api/payout)
2. [Payout Webhook Events](/api-reference/tazapay-api/payout-webhooks)
3. [Payout Failure Reasons](/api-reference/appendix/payout-failure-reasons)
4. [Payout Reversal Reasons](/api-reference/appendix/payout-reversal-reasons)

### Best Practices

* Always verify webhook signatures
* Make payout creation idempotent
* Store payout event history for reconciliation

***