With Stripe's straight-forward pricing at 2.9% + $0.30, I don't understand the pricing ambiguity here:
"and Stripe, our payments processor, will apply credit card processing fees (about 3-5%)."
Why 3-5%? Is there something I'm missing?
"and Stripe, our payments processor, will apply credit card processing fees (about 3-5%)."
Why 3-5%? Is there something I'm missing?
That's an understatement ;)
Kickstarter might have cut a deal to pay a higher percentage in order to be allowed to use Stripe.
Stripe's fees don't change per card.
Typically, (big) payment processors deal with different interchange fees for different card types (based off the BIN number-- premium cards, debit cards, reward cards). Processors commonly group fee percentages into an easier scheme to sell to people.
"2.9% + .30" is a lot easier to reason and understand than "2.2% for Debit, 3.5% for AMEX, 2.9% for Bank of America" and so on.
So yes, different cards charge different interchange rates -- but the answer to the question lies in the fact that with small enough purchases, the 30 cents on top of the 2.9% could effectively increase the percentage to a higher rate.
The simple formula to calculate fees as a percentage of purchase would be y= (x*.029+.30)/x and it intercepts with 5% at about $14.28, which would suggest that the minimum contribution would be set around $15 to make their statement correct. A a much higher contribution of $300 would have a lower rate of approx 3%, as the cents become a rather unimportant part of the fee.
Why do processors like doing this? It's a way to subsidize micro-payments without creating convoluted fee schedules. They can collect ~33% of a $1 payment without advertising it as such.
Stripe charges a flat 3.0% + $0.30 for each transaction, regardless of the card provider.
The other child comment proposes the likely reason for the 3-5% ambiguity; that $0.30 flat fee can have a percent impact on smaller purchases.