I would definitely recommend escrowing the funds in order to offer the best user experience for both students and teachers. This is central for the success of your project. The model I'm thinking about is used by merchants providing similar services like task rabbit. An important question is where are you going to launch this platform ? Regulation is very different according to the place you're located. In Europe, third party payment is strictly controlled by authorities and require strict KYC data in order to be compliant with EU payment directives. In the U.S. I would recommend some solutions already tested and approved by the sharing economy ecosystems. All the best with your project. Bertrand