Ledgering System

​

Overview

Rain handles off-chain ledgering using the same fundamental approach banks and accounting systems have used for centuries. Every financial movement creates balanced entries that always sum to zero: what goes out of one account goes into another.

​

Structure

Rain’s ledger is organized into three layers:

1. Accounts: Each user or company has an account. System accounts also exist for operations like Treasury and Issuing Processor functions.
2. Books: Each account has multiple books that track different types of money movement:
   • Card Pending: Funds on hold from card authorizations that have not yet settled
   • Card Posted: Final, settled transactions (details in the transaction.completed webhook)
   • Fees: Platform fees charged to the customer
   • Due: What the customer owes or is owed
3. Journal Entries: Every transaction creates a journal entry with at least two book entries that balance each other out.

​

Transaction Flows

​

Customer deposits funds

When a customer deposits $500:

• Their Due book decreases by $500 (they owe less)
• The Treasury account increases by $500
• Result: Available balance increases by $500

​

Card authorization

When a customer authorizes a $100 purchase:

• $100 goes into the customer’s Pending book as a hold
• The payment processor’s authorization book records the same $100
• Result: Available balance decreases by $100 immediately, even though the transaction has not settled

​

Card transaction settles

When the $100 transaction settles:

• The $100 hold is released from the Pending book
• $100 moves to the Posted book (now final)
• The payment processor’s cash book is updated
• Result: Available balance stays the same: funds moved from pending to posted

You will receive a transaction.completed webhook when settlement occurs.

​

Fees charged

When a $5 fee is charged:

• The customer’s Fees Posted book records $5
• The Treasury receives $5
• Result: Available balance decreases by $5

​

Key Principles

1. Everything balances: Every debit has an equal credit elsewhere. The system does not allow entries that do not sum to zero.
2. Pending vs. Posted matters: Authorizations immediately reduce available balance (pending), then settle into posted transactions. This prevents overspending.
3. Full audit trail: Every entry records exactly when it happened and why, with snapshots of balances at that moment in time.
4. Atomic transactions: All entries for a single financial event are created together or not at all. There are no partial updates that could leave things unbalanced.

​

Balance Calculation

A customer’s available balance is essentially: The system adds up all the relevant books to show what’s available to spend at any moment.