Comment by posguy | Hacker News Reader

Comment by posguy | Hacker News Reader

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Quick question about Stripe, how do you plan to retain customers long term? I ask this as a person who has moved a couple businesses off Stripe, pricing & corner cases like easy debit support are the main two motivational factors.

For example, Centurylink lets you pay online via debit card with just the card # alone. No CVV, address, expiration date, etc. For low fraud industries, this is a way to leverage very cheap debit card rates (eg $0.65 flat for small bank/credit union debit & 0.05% + $0.21 for large banks that are regulated debit), while making it simple to use debit cards compared to a credit card. If Stripe were to offer something like this, it would be a harder sale to make when I come in and review their phone/payment processing/ISP bills and pitch them $XXX savings.

Another thing is on credit, not offering over interchange pricing essentially limits you to only working with very small businesses. A supermarket I work with (4 employees including the owner) does $100k volume a month average, and is paying only 0.83% to 0.85% ($830 to $850 a month in total fees on 100k volume) a month, how can Stripe get anywhere close to that?

These types of issues could limit Stripe to a small & shrinking niche long term, especially with Mercury offering similar APIs with more features (though less accessible) at rock bottom pricing, and Heartland, Gravity and others piling on in a race to the bottom. IMO the reasonably easy to access & inexpensive API is the differentiator keeping Mercury viable.

Stripe markets to tech companies. Tech companies typically have very strong margins, and are therefore less price sensitive. Ergo, Stripe survives on businesses that print money.

Not everyone can afford an iPhone, but Apple still is filthy rich from the people who can.

You'd think, but 2.9% off the bottom line in the form of a large fee every month is something most companies will look to reduce or curtail after a few months or years. If your only processing a few grand a month, Stripe makes sense vs a traditional processor.

Once you hit $20 million in sales ($300-400k), the difference gets very noticeable vs. paying one internal IT and a couple security consultants to audit the work.

I don't disagree; its no different than AWS: once you get big enough, its time to roll your own or bring it in house. Until then, lots of money to be made selling shovels.

No one looks at their SMB customers and says "To hell with that market, they'll just leave once they're big enough!" The market for people building from scratch is enormous.

The thing is, you can't roll your own in house, but you can replace Stripe at a much lower cost with a different vendor. They all process cards after all!

I think Stripe would be offering much better deals for high volume. With Stripe you are also paying for what they have built on top of just accepting the payment. If you are high volume and willing to use a no frills provider it doesn't surprise me that you would get a better deal.

We use PIN, a Stripe clone, for some currencies where they could offer us a better rate/ settlement. For our primary AUD transactions we are just using a bank on a much better rate.

I moved out of Stripe because stripe charges $15 for charge backs for my product worth $10. The dispute resolution mechanism sucks and it almost all the time favors the customer and stripe is US only. My product is worldwide.

Yeah, Stripe only gets so much say over chargebacks with their platform provider and the cardholder's bank, the only platform that I've seen chargebacks successfully fought & won on is Tsys, its always a loser on First Data.

That being said, $15 is a low chargeback fee (damn close to cost the issuing bank & platform charge), generally you'll see a $25 to $30 chargeback fee with a $20 to $75 retrieval fee.

I had two chargebacks on my service using Stripe (https://breaker101.com/ </shameless-plug>), and successfully fought both of them. Just throwing that out there.

how does paypal handle these ? When there is a dispute, I refund the amount and thats it. Paypal bears the chargeback and Stripe passes it to the merchants ?

Software Engineering Daily had an episode[0] on fraud detection at stripe using machine learning. If you're interested it provides quite a bit of background information.

[0]: https://softwareengineeringdaily.com/2017/03/17/stripe-machi...

Paypal charges a $20 chargeback fee on disputes with a credit card company.

I use Stripe from Japan and it really sucks when it comes to chargebacks. I have won like 2 of 30 cases. I provide customer's ID, shipping labels, tracking info and still lose. I had one friendly fraud case, when a customer was using both Stripe and PayPal. Later the customer opened disputes for every payment made within 3 months. It was like dozens of disputes on both PayPal and Stripe. I have won all on PayPal and lost all on Stripe. Those two cases I won on Stripe was like the acquiring bank started the chargeback without notifying the client. The client worked with us, the acquiring bank admitted the mistake and still we had to fight to convince Stripe that we won the dispute. I strongly believe that they just automatically process the chargeback forms and don't give a thing about winning it. Not to mention that they charge you even if you win a dispute.

>For example, Centurylink lets you pay online via debit card with just the card # alone. No CVV, address, expiration date, etc.

WTF? It is amazing that card industry still works with such horrible security.

Debit networks are wholly separate from Visa/Mastercard, different ballgame entirely. You get to deal with a few hundred tiny debit networks that replace Visa/Mastercard/Amex/Discover for processing the payment.

Centurylink has your name/address/SSN and can cut your services off at a whim if anything happens, so fraud would be inadvisable.

US debut networks. UK debit is via Visa, MasterCard etc typically.

Europe is a whole different ballgame, Visa itself runs multiple networks, and you've got heavy regulation kneecaping debit at 0.2% for interchange, and 0.3% for credit card interchange. Competition takes different forms, but it is a pretty fragmented market in the EU.

The rates in Hong Kong with Stripe for non-hong Kong issued cards is 3.9% + 2% conversion fee if you don't charge in HKD. Additionally they're unable to deposit into a US denominated bank account.

So if you want to process USD to US clients in HK with stripe the fees are 5.9% which is fairly laughable.

With 4+ million USD yearly volume, the only discount I could get would be 1% off the conversion fee to start.

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