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It's unsustainable for handling small payments. Things like fraud detection, customer support, legal and financial services, and credit card chargebacks add up
by benatkin 7y ago
It's unsustainable for handling small payments. Things like fraud detection, customer support, legal and financial services, and credit card chargebacks add up to more than 5%, if it's truly crowdfunding (lots of small contributions). There's a lot of failed startups in the crowdfunding space.
- ac29 7y ago5% is their cut after payment processing, which is another 3% or 5% extra (depending on the size of payment, with smaller payments being more expensive to process). For a $1 payment, they actually take 20% (10c + 5% + 5%).
- benatkin 7y agoI'm aware of that, which is why I didn't mention it in my list. It's about what Stripe charges. The micropayment rate of 5% is effectively lower because its per-transaction fee is $0.10 rather than $0.30. A $3.00 donation would have a $0.25 fee and a $3.01 donation would have a $0.39 fee.