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Hasn't this been the case for 4-5 months? I remember getting an email from Stripe about this back in September or October 2019, or was that PayPal? The only th

by nickjj 7y ago

Hasn't this been the case for 4-5 months? I remember getting an email from Stripe about this back in September or October 2019, or was that PayPal? The only thing that really bugs me a lot about Stripe (to the point where I've considered moving to Braintree for my next project) is how they handle fraud detection. Stripe has all the power to prevent many forms of fraud and provides this as a service as long as you pay a premium for it in the form of Radar. You have to pay extra on top of the 2.9% + 30c per transaction to get this protection. But instead of providing Radar as a base service to all customers for the standard rates, they would rather you have fraudulent transactions against your account because they profit from "dispute fees", which is usually $17 or so per dispute that the merchant has to pay out of pocket, where Stripe takes some cut of that and the bank takes the rest of the cut. It just feels super scammy of Stripe to not offer Radar as a thing you get by default, since it's so beneficial to have and business owners are powerless in preventing fraud on their own because they don't have hundreds of millions of transactions of data to lean against and a way to perform analysis on the transaction before it happens since merchants aren't directly in contact with credit card vendors (that's why we use Stripe). I actually talked to support about this once in an email a few weeks ago, and the email began with them saying it's the merchant's responsibility to deal with fraud but by the end of the email discussion, support completely switched their position and said Stripe has the power to prevent it and they will pass my feedback to their product team. Which of course really means "ok, you win, Stripe is really responsible for fraud detection and we can totally do it, but we're never going to give it to customers out of the box because we profit from fraud regardless of you paying for Radar".

pc 7y ago
> Stripe has all the power to prevent many forms of fraud and provides this as a service as long as you pay a premium for it in the form of Radar. You have to pay extra on top of the 2.9% + 30c per transaction to get this protection. Radar's ML-based shield is free for all accounts on standard pricing. See https://stripe.com/pricing#radar-pricing https://stripe.com/pricing#radar-pricing. (We only charge if you want to set custom rules etc.)
- nickjj 7y ago
  > (We only charge if you want to set custom rules etc.) The rules are what really allows merchants to protect themselves against fraud but this information isn't possible to obtain without help from their payment gateway (ie. Stripe). In other words, merchants have no reasonable options to set up rules like what Radar does while using our own custom logic because there's no API that Stripe provides for us to get things like the risk score before the transaction takes place. If Stripe had an API endpoint where developers could get the risk level of a transaction before the payment intent was put into motion then we could in theory build our own risk management tool at our app level by saying "if $risk_score > X then deny transaction". But AFAIK nothing like this is possible, so our only option is to pay the extra transaction cost for Radar or deal with a less than ideal fraud protection even though Stripe can technically do this already. It just feels really dirty. It feels like instead of optimizing for the greater good and making the developer / business experience awesome, Stripe would rather pivot from being a payment gateway to an insurance company and then nickel and dime the businesses that helped build Stripe initially. It's one of those things where it's like, we've been using you for years (quite happily in fact), but you collected all of this data from us and now instead of helping us by offering fraud detection across the board, you'd rather sell our data back to us in the form of insurance.
  - audiometry 7y ago
    " you collected all of this data from us and now instead of helping us by offering fraud detection across the board, you'd rather sell our data back to us in the form of insurance." This kind of move is always galling. McGraw-Hill/Platts is terrible with this, where they take data from traders' transactions and then resell it back to them at extortionate rate. Whole market hates them.
  - patio11 7y ago
    You're welcome to do your own risk scoring on any signals you want prior to directing us to charge a credit card for you. You're also welcome to do post-charge processing using our risk scores. Some companies will e.g. do post-transaction reviews prior to shipping; some write their own workflow SaaS into their admins to do this. If you don't choose to write your own software using your own data, that's cool; you can buy that software from us, for two cents a transaction (or less). We're a software company selling to software developers. We're cool with you writing your own software with your own data if you think your engineers are sufficiently efficient at this to make that the best possible use of their time. (The businessman in me suggests that it is extremely unlikely you can profitably employ engineers to write this software at most likely scales of your business and, contingent on being able to do that, it is quite likely there are a hundred better projects not upper bounded at 2 cents a transaction, but you are a project away from constructively disproving this if you strongly disagree.)

by nickjj 7y ago

pc 7y ago

> Stripe has all the power to prevent many forms of fraud and provides this as a service as long as you pay a premium for it in the form of Radar. You have to pay extra on top of the 2.9% + 30c per transaction to get this protection. Radar's ML-based shield is free for all accounts on standard pricing. See https://stripe.com/pricing#radar-pricing https://stripe.com/pricing#radar-pricing. (We only charge if you want to set custom rules etc.)

nickjj 7y ago
> (We only charge if you want to set custom rules etc.) The rules are what really allows merchants to protect themselves against fraud but this information isn't possible to obtain without help from their payment gateway (ie. Stripe). In other words, merchants have no reasonable options to set up rules like what Radar does while using our own custom logic because there's no API that Stripe provides for us to get things like the risk score before the transaction takes place. If Stripe had an API endpoint where developers could get the risk level of a transaction before the payment intent was put into motion then we could in theory build our own risk management tool at our app level by saying "if $risk_score > X then deny transaction". But AFAIK nothing like this is possible, so our only option is to pay the extra transaction cost for Radar or deal with a less than ideal fraud protection even though Stripe can technically do this already. It just feels really dirty. It feels like instead of optimizing for the greater good and making the developer / business experience awesome, Stripe would rather pivot from being a payment gateway to an insurance company and then nickel and dime the businesses that helped build Stripe initially. It's one of those things where it's like, we've been using you for years (quite happily in fact), but you collected all of this data from us and now instead of helping us by offering fraud detection across the board, you'd rather sell our data back to us in the form of insurance.
- audiometry 7y ago
  " you collected all of this data from us and now instead of helping us by offering fraud detection across the board, you'd rather sell our data back to us in the form of insurance." This kind of move is always galling. McGraw-Hill/Platts is terrible with this, where they take data from traders' transactions and then resell it back to them at extortionate rate. Whole market hates them.
- patio11 7y ago
  You're welcome to do your own risk scoring on any signals you want prior to directing us to charge a credit card for you. You're also welcome to do post-charge processing using our risk scores. Some companies will e.g. do post-transaction reviews prior to shipping; some write their own workflow SaaS into their admins to do this. If you don't choose to write your own software using your own data, that's cool; you can buy that software from us, for two cents a transaction (or less). We're a software company selling to software developers. We're cool with you writing your own software with your own data if you think your engineers are sufficiently efficient at this to make that the best possible use of their time. (The businessman in me suggests that it is extremely unlikely you can profitably employ engineers to write this software at most likely scales of your business and, contingent on being able to do that, it is quite likely there are a hundred better projects not upper bounded at 2 cents a transaction, but you are a project away from constructively disproving this if you strongly disagree.)