Stripe Payments Review
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There’s no question that Stripe is a media darling. With its hip, trail-blazing co-founders, its focus on empowering Internet businesses with a developer-first focus, and flexible solutions for almost any kind of online business, that’s not surprising. We haven’t even gotten to all of the big-name online businesses that Stripe processes payments for: Lyft, Under Armour, Blue Apron, Pinterest, Wish, TaskRabbit, and more. There’s a lot of talk (and a lot of news articles) about how Stripe wants to change how the entire Internet does business, and all the innovation the company embraces.
But does the reality live up to the hype?
Stripe is a third-party payments processor built around a simple idea: make it easy for companies to do business online. It’s not just about processing credit cards (that’s boring to most people). In fact, the fact that Stripe accepts credit cards is often secondary to all of its developer tools. Regardless of what anyone might think of Stripe’s reliability or customer service, there’s no question that the developer features are industry-leading and the documentation exceeds just about anything else out there. Whether you’re a SaaS business looking for subscription billing or a marketplace looking for an easy way to split payments — or an online retailer looking for a way to power in-app payments — Stripe has you covered. Its feature list is impressive, if a tad overwhelming for the uninitiated.
There’s a lot to love about Stripe, that’s for sure: It’s powerful, easy to use, and chock-full of features. But it’s not for everyone.
Many of Stripe’s features are tailored to larger enterprises. Stripe has powerful tools for marketplaces and developers, as well as large eCommerce enterprises and global businesses. And it’s also fairly apparent that Stripe is committed to global commerce with its automatic currency conversion and Atlas program.
I don’t think Stripe is a good option for small merchants who want to do it themselves or need a simple solution just to get up and running. If you’re not going to use everything Stripe has to offer, or if you don’t have strong dev skills or a developer on your payroll, it’s hard to recommend it over other options.
While you can certainly use Stripe to run online payments for a simple eCommerce site or create some basic subscription billing options, that’s barely tapping into Stripe’s potential. There are plenty of other options capable of meeting those requirements, and most of the time you won’t need a developer to implement them.
Furthermore, as a third-party processor, Stripe isn’t immune to the same sort of problems that plague PayPal, Square, and other payment processors that aggregate rather than opening individual merchant accounts: common account holds and terminations and spotty customer service.
Stripe has earned itself a respectable 4-star rating for all of these reasons. If it could work on that account stability and customer service, it could move beyond 4 stars — but not until we see demonstrable improvement.
This is my recommendation: If you really plan to use all of the cool features Stripe has to offer, it’s worth putting on your shortlist (which, by the way, should also include Braintree). If you are a low-volume user (under about $10K per month), the no-monthly-fee setup at Stripe is in your favor…but there are still other options to accept payments online, for both developers and non-developers.
For higher-volume users who don’t necessarily need all of the bells and whistles the Stripe offers, but still require a developer-friendly option, consider PayJunction. It offers interchange-plus, and the developer support is pretty solid. The feature-set isn’t exactly what Stripe has, but it’s versatile.
If you are a low-volume user who only needs some of the basic dev functions, or if you want a seamless way to accept payments online and in-person, you might want to look at Square (which ticks all of those boxes) or PayPal (which is far more user friendly but also offers a solid array of dev tools).
Check out the full review for more information, and let me know what you think in the comments section.
Products & Services
Stripe’s basic offerings are deceptively simple, but underneath you’ll find tools you probably didn’t even realize existed. Everything is broken down into two categories:
- Payment processing: Stripe gives you instant access to processing, much like Square or PayPal does. It’s a third-party processing service (also known as an aggregator), which means the company will approve you almost instantly and scrutinize your account more closely as you continue to do business. That tends to lead to more terminations than a traditional merchant account, which does its vetting in advance and offers more stability. Stripe’s processing services are available in 25 countries at the time of writing this (including beta tests), but it accepts more than 100 types of currency.
- Developer tools: This is the part of Stripe that most users really sink their teeth into. These APIs (application programming interfaces) provide an incredibly solid and well-considered framework for developers to quickly and easily integrate the Stripe payment platform using a variety of languages (curl, Ruby, Python, PHP, Java, Node, etc.). It’s a solid foundation to build on and expand your business, and Stripe updates its features and the documentation constantly.
Here’s a quick rundown of some features Stripe has set up for you (or your developer) to work with:
- Stripe Checkout: Checkout saves you from having to design forms and payment flows from scratch, but also allows for a high level of customization. PCI compliance is handled for you, and you get a hosted checkout page. Stripe has also introduced Elements, a collection of pre-built components for you to design a custom checkout.
- Mobile commerce integration: Stripe provides documentation for Android or iOS to power in-app payments. There’s also a one-touch solution that enables users to save their data for faster purchases next time.
- Marketplace solutions: Stripe is continually expanding its offerings in this niche, which shows that it clearly is invested in helping it thrive. There are a huge array of tools to help you route your payments to your merchants, and you can even offer them instant deposits.
- Platform building tools: Marketplace solutions fit under this, but you’re not limited to that. Basically, you can build any platform where you need your users to get paid. Lyft uses Stripe, as does IndieGoGo.
- Subscription solutions: This includes unlimited options for plan types.You can even subscribe single users to multiple plan types. Upgrading subscribers to higher tiers is easy. This is one feature that actually works in favor of everyday merchants, and it’s provided at no additional charge for merchants (compared to $10/month for PayPal).
- Coupons and free trials: Stripe provides great marketing tools, made easy. Entice would-be customers to take the plunge by setting up a free trial period or providing a special offer.
- Teams: Create teams for your employees and assign permission levels to them, which keeps your data secure.
- Stripe Connect: Connect is a suite of tools designed specifically for marketplaces. Stripe supports more than 100 currencies and automatically converts them. You can also use Connect to verify international sellers, add descriptor text that appears on credit card statements, and automate payments for marketplace sellers or create a custom payment schedule.
- Stripe Atlas: Atlas allows international businesses to incorporate in the U.S., set up a U.S. bank account, and get tax and legal guidance. Stripe says it has had more than a thousand startups apply in more than 120 countries, and it has added more than 100 partners to the network since the launch.
- Stripe Radar: Radar is Stripe’s solution to eCommerce fraud. (Fun fact: there’s a lot of online card fraud already, and likely to be even more as EMV comes into prominence.) So this is actually worth pausing and taking note of. Radar uses machine learning to better identify and stop credit card fraud. It also gives merchants tools in their dashboard to allow them to set specific rules for transactions, test what impact those rules will have based on previous data, and reduce the amount of manual work your team has to do.
- Stripe Relay: Relay allows you to power purchases in mobile apps, creating a mobile marketplace of sorts. Relay’s features allow merchants to link their eCommerce catalogs with your app or directly upload product information. Relay creates in-app buy buttons and forwards all the sales information to the merchants to fulfill the order.
More About Stripe’s Features
First things first: If you want to take advantage of Stripe’s payment processing without getting involved with the developer tools, consider using a third-party Stripe plugin for WordPress, Magento or Drupal. You can also take advantage of the dozens of services that allow for simple Stripe integration for e-commerce, invoicing, form building, analytics, and so on. Some integrating providers include BigCommerce, Shopify, Squarespace, Big Cartel, Stitch, Harvest, Weebly, and a ton of others.
Second: If you take a look at all of the integrations and plugins that Stripe is compatible, it’s pretty clear that you could create an omnichannel payments system if you wanted to invest the effort. But Stripe doesn’t have its own POS/mPOS app, and it doesn’t have a proper virtual terminal.
You can accept orders over the phone with Stripe, but it is on you to protect your customers’ card data, so Stripe recommends using an invoicing service as an alternative. You also can’t use this as your primary means of payment processing either — Stripe is not meant to be used as a virtual terminal. It’s more of a last-ditch effort if everything else has failed.
In a time when most processors are moving toward an all-in-one, multi-channel approach, the fact that Stripe is more invested in mobile and internet commerce definitely makes it stand out. I’m not sure if that’s good or bad, but if you are looking for more than just in-app or online payments, Stripe might not be the best option.
Something else worth mentioning is security. Stripe is a PCI Level 1-compliant service, which is the highest level of certification. In addition, if you decide to leave Stripe, they will help you export all of your card data to a new PCI compliant provider. That’s a pretty awesome deal.
That’s Stripe in a nutshell. If you’re wondering, “Do I really need all that?” the answer is probably no. Stripe is more friendly to large businesses, SaaS platforms and marketplaces. If you’re just trying to run an eCommerce business, you might want to look at one of Stripe’s processing partners (Shopify, Squarespace) and get set up through them, or look elsewhere entirely.
If you don’t have a developer on the team, you’re not going to be able to get the most out of Stripe anyway. It’s powerful, but it’s not a solution that works for anyone or everyone.
Stripe Fees & Rates
One of the nicest things about pay-as-you-go processors is that they generally have a pretty clear pricing structure. For each credit card transaction, Stripe charges just a single flat rate:
- 2.9% + $0.30
Stripe also supports ACH (direct deposit) and Bitcoin transactions. You’ll pay just 0.8% per each transaction, up to a maximum of $5.
Something new for Stripe is its quiet rollout of a micropayments plan for digital goods. Since a $0.30 per-transaction fee is pretty steep on a $0.99 or $1.99 download, micropayment plans charge a higher percentage fee and drop the flat per-transaction fee. This is nice to see, though you need to look carefully on the pricing page to find information about it. You can also get volume discounts if you do a lot of business on a monthly basis. In both cases, you’ll have to negotiate for these by contacting a sales rep directly.
Also take note: different fees may apply if you’re using Stripe Connect.
That said, here’s some proof that Stripe really likes international businesses: Merchants can display prices in multiple local currencies instead of just 1. Stripe automatically converts them for you. Generally speaking, there aren’t any exchange fees, just the conversion rate to worry about.
Stripe’s pricing is fair and absolutely competitive in the industry, given the complete lack of additional fees and the plethora of features available. Plus, 2.9% + $0.30 is exactly what Square, PayPal, and Braintree charge for online transactions, too. I like that Stripe’s added micropayments, which definitely makes its platform more viable for digital content creators, artists, musicians, and others.
However, if your primary criterion is cost, keep this in mind: Stripe is competitively priced, but it’s not the most affordable option. There are still many interchange-plus plans, as well as nonprofit discounts available. Stripe’s lack of monthly fees is a mark in its favor, especially for low-volume merchants. In the end, though, you can on;y be sure you’re getting the best deal if you compare the numbers for yourself.
Additionally, Stripe charges the industry-standard chargeback fee of $15. I like that it will refund this fee if the chargeback is decided in your favor. Not all processors do this, and it’s fairly generous considering that they have to pay to do the paperwork one way or the other. However, customer reviews of Stripe suggest that very rarely, if ever, will you have a chargeback decided in your favor.
Stripe now offers two-day payouts to most US-based merchants, except those it deems “high risk.” This is a vast improvement of their former seven-day rolling payouts. Most international merchants are still stuck with the seven-day system for now, though.
Contract Length & Early Termination Fee
No early termination fee. Period. Thumbs up. That’s what we like to see here. And remember we said Stripe will help you export your customer data and take it with you if you ever decide to leave.
However, I can’t stress this enough: Just like you’d read a contract for a merchant account, read Stripe’s terms of service before you sign up. Like any other third-party processor, Stripe does include a provision that it can terminate your account or implement a hold if it deems your business an unacceptable risk (or for pretty much any other reason, or no reason at all).
If you prize stability over anything else in a processor, Stripe isn’t a good choice for you. And if you do have a consistent volume of chargebacks (which is to be expected with online retailers), I also recommend staying away — per a comment on a TrustPilot review, Stripe states that it won’t work with merchants who have a chargeback rate exceeding 1%.
But if you’re looking for flexibility and no monthly fees, or a scalable platform to build your business on, Stripe is definitely a good choice.
Sales & Advertising Transparency
Stripe uses transparent, ethical, fair advertising, with none of the common problems seen from big companies. Stripe has no hidden fees, no unusual contract terms, and no scams or gimmicks to speak of.
If you’ve processed cards before, you shouldn’t be met with any surprises from Stripe as far as financial operations go. If you haven’t, then there might be a slight learning curve. But Stripe is a good company to learn with (financially speaking) since the service is entirely pay-as-you-go.
I do wish it was a little easier to learn about some of Stripe’s features. It’s not that the information doesn’t exist; usually it’s buried in the documentation part of the site rather than laid out on the main pages. That’s better than many companies that don’t offer any sort of information at all, at least.
Customer Service & Technical Support
The good news: Stripe has email-based customer service and support, alongside a number of public social media outlets. You can follow the company on Facebook, Twitter, and LinkedIn, and get updates on Stripe services via Twitter. However, posts to their social media and blog are infrequent, and I think there might be some missed opportunity there. For a company that’s all about the digital revolution, I kind of expected more.
I like that you can still reach out to support with questions without having to log into a Stripe account. A lot of companies will require you to sign up and sign in first, but if you’re still shopping around and just want to get a question answered, Stripe will do that for you. There’s a passable knowledge base, but honestly, when I start digging into Stripe for more information, I usually head over to the developer documentation, which will give you a much more detailed look at what is even possible
Something else cool that Stripe offers is status reporting. Head over to status.stripe.com to find out about service uptimes.
Now for the bad news: You (still) can’t get Stripe on the phone. A lot of merchants have complained about generic customer support responses and an overall lack of personal attention given to problems. In fact, I see this complaint with greater frequency than during my previous review updates. In some ways, this reminds me of Square’s customer service, especially in the early days (which is certainly not a good thing).
I get that phone support is difficult and an expensive investment, but when merchants can’t accept payments, they need a solution (or at least an answer) right away. Email just doesn’t cut it. We’ve seen this same argument with Square, which also gave in and added phone support, eventually. I think now we just have to wait and see how long before Stripe expands its support options to include phone support as well.
On the plus side, Stripe has pretty effective Freenode-based chat support (#stripe). There you’ll find both Stripe reps and other users to give you instant advice and solutions. It’s a good starting place, at least, and offers a somewhat public channel for you to voice your concerns or troubles, especially if you’re having technical problems.
Still waiting on that phone support, though.
Negative Reviews & Complaints
At the time of writing this review, Stripe’s BBB page still has an A+ rating with 403 complaints in the last 3 years, 87 of them in the last 12 months. That’s pretty steady since our last check-in (393 in 3 years and 92 in the last 12 months). It appears that the complaint volume has leveled out significantly, at least on the BBB page.
Stripe also has 51 reviews on the BBB page, only three of which are positive. That is disappointing, but not exactly surprising. You can find other positive reviews elsewhere on the web, but that’s another section. We’re looking specifically for the bad stuff right now.
Ripoff Report shows 107 reports (up from just 47). Most of the complaints (that aren’t junk complaints about shady companies) pertain to account holds or terminations, though I am seeing more frustration about the lack of phone support.
I did look at a few other review sites to gather some more information on merchant experiences with Stripe, and the reviews were definitely mixed. Some merchants do love Stripe; others have problems.
Combined with data from the BBB and Ripoff Report, these are what I’ve found to be the most common complaints:
- Account holds and terminations: Without question, the most common complaint against Stripe is sudden account terminations and sweeping payment reversals without notice and with little explanation. Merchants also comment about sudden holds on their funds while their account is “under review.” This kind of thing happens all the time with third-party payment providers. While they give you instant access to payment processing, they can (and absolutely will) review your account and processing habits soon after you begin to use the service. At this point, they can cancel your account for any number of reasons, real or perceived.
- Unresponsive customer service: This seems to come up less with everyday problems, and more when a serious and difficult issue comes up (like funds being held or accounts being canceled). More than one user has complained about being ignored in these situations, or it taking days, or weeks, to get a response. However, Stripe’s Twitter account seems active and the support reps are helpful.
- Chargebacks: Let me start by saying that a chargeback is not Stripe’s fault. The company deals with Internet businesses, many of which offer higher-risk products (electronic delivery, subscription-based products, international sales, etc.), so chargebacks are going to happen. When a chargeback occurs, Stripe becomes responsible for giving the money back to the customer. Because of this, it will take the money from you to cover the cost, at least until the investigation has closed. Stripe didn’t invent the way the industry handles this issue, and in many ways, it simply has no control over these protocols. It also merits mentioning that Stripe doesn’t offer any sort of assistance in fighting chargebacks beyond its documentation tools — but then again, only a select few processors get hands-on in the process. And don’t forget that Stripe has said it won’t work with merchants with a chargeback rate exceeding 1%.
- Not User-Friendly: Stripe is not a payment processing option for the layperson or the DIYer — not unless you’ve got coding experience. Plenty of users complain about the ease of use (or, perhaps more accurately, the lack thereof). Remember: Stripe was built with developers in mind first and foremost. If you need something that you can just plug and play, this is not the option for you. Instead, I highly recommend checking out PayPal or Square.
- Lack of fraud protection: This issue ties into the matter of chargebacks, but is also worth discussing in its own right. Merchants don’t seem to feel like Stripe gives them any way to protect against fraudulent charges and chargebacks. That’s not to say there aren’t any tools that merchants can enable — there are several. But merchants feel that the system is somehow broken, which I completely understand.
The lack of fraud protection is not something to take lightly, and so I really dug into it. This is what I found: Stripe has an automatic algorithm that works to identify fraudulent transactions and flags them. There is not a lot of information out there about how it works. We do know the system can generate false positives, so if you find a declined transaction that you know to be legitimate, you can override it and try the transaction again.
You can also mark transactions as fraudulent and refund them yourself (make sure you report them to Stripe.) Second, you can enable CVC and AVS (address) checks and automatically decline transactions that fail them (these are two separate things). That second part is important because a transaction can still go through even if the checks fail. However, at the same time, it is not uncommon for legitimate shoppers to get their own zip codes wrong. These checks aren’t enabled by default, so you have to go in and adjust your settings yourself.
If you’re curious, you can check out a few case studies about Stripe’s fraud prevention here.
In the meantime, do your homework: Check that you have any relevant security measures enabled. And if you notice a change relating to Stripe’s fraud protections, let us know!
Positive Reviews & Testimonials
Stripe has an expansive and impressive list of successful clients, including IndieGoGo, Squarespace, Shopify, Reddit, Mashable, Volusion, eHow, Hubspot, and recently, Amazon. We’re talking about some major Internet players, which definitely constitutes a big deal — even though no specific praise is given besides their continued business.
While Stripe doesn’t go as far as Braintree does with intensive case studies, it does at least offer a nice page of logos for you to browse and some shiny marketing copy. Check it out. Aside from that, I would love to see some case studies about features beyond fraud prevention, and maybe some more proof from some small and medium-sized businesses, not just the giants of commerce.
From the user reviews I have seen, merchants seem to love the freedom that Stripe offers. Those that have developer teams say it’s also very easy to use and flexible enough to accommodate their needs. Most think the pricing and value is pretty fair for what you get (the developer tools are included at no charge, after all). While I do see some comments that the customer support is good, it’s not an overwhelming number — certainly not more than the complaints about non-responsive or unhelpful service.
Please leave us a comment if you have firsthand experience with Stripe. Make sure to review our comment policy before posting to ensure we’re able to publish your remarks.
Without any doubt, Stripe is a major contender in the new, simplified, stylized online payments industry. Stripe, Braintree, and probably others I haven’t discovered yet are all vying for the top spot, each offering subtly distinct services, but all charging almost the exact same rates and operating on similar business models. PayPal and Square figure in there some way too, especially as they move more and more into the realm of omnichannel commerce, not just mPOS or eCommerce.
In theory, Stripe delivers everything that small and large merchants alike should want. However, it fails in some elements of its execution, particularly regarding the stability of its clients’ accounts and overall customer service. Unfortunately, that’s not exactly a unique failing among payment aggregators, either.
Second, many tools seem targeted especially at developers, large businesses, and marketplaces. It’s all well and good that Stripe offers them. They’re important. If you’re tech-savvy, or you have someone to handle the code for you, you’ll go far with Stripe. But if all you want is an easy way to take payments on your website, I don’t see a clear advantage of using Stripe over one of the other options. In fact, Stripe will probably be far beyond what you need.
Having a developer on hand will be crucial to being able to truly utilize all of Stripe’s features. If you don’t have the ability or the money to pay someone else, you might be better off with another payment processor.
And finally, you’re going to get competitive pricing with Stripe, but it won’t be the lowest pricing you can get. For that, you will have to look elsewhere.
Stripe has earned its 4-star rating for now. It is not a perfect processor, but it is a pretty good one. Ultimately, ask yourself two questions: (1) Will you use everything Stripe has to offer? (2) Does Stripe have everything you need? If the answer to both questions is yes, it’s worth pursuing. If the answer to either question is no, you should look for other options.