4 ms·

Can stripe 1st work on reducing their fees? They're just like the incumbents. Only surrounded by more silicon valley sycophants. Taking 2.6%+ of every merchan

Can stripe 1st work on reducing their fees? They're just like the incumbents. Only surrounded by more silicon valley sycophants. Taking 2.6%+ of every merchant transaction is nuts.

Throwaway1771 6y ago
Small businesses pay >2.9%+0.30¢ all the time.
- elevenoh 6y ago
  Yeah, it's sad to see. There's now no economic reason for these fees to remain so high. I worked at a payment processor.
  - xtracto 6y ago
    Exactly! Credit Card fees are supposedly set according to risk. However, the way the networks are setup is a legacy from last century. The way I always think of it is like this: You would NEVER accept to pay to send an email per number of the words in that email, at the end of the day it is just transferring bytes. However the payments industry has been working like that for too long, why does the cost of sending some "money transfer" bytes be a function of the number you are sending? (like, sending $9156 is more expensive to transfer than $100000 bc of compression) That's why I joined Paystand [1] to do "Payment as a Service". Similarly how you pay a fixed monthly a month to receive emails, you should be able to pay a fixed amount to receive payments (using the Paystand network). Nevertheless, we have to support legacy networks such as Mastercard, VISA or Amex which still charge customers per transaction. [1] https://venturebeat.com/2020/02/06/paystand-raises-20-million-to-modernize-b2b-payments-with-blockchain/ https://venturebeat.com/2020/02/06/paystand-raises-20-millio...
    - manigandham 6y ago
      Aren't the fees about covering the transacted amount rather than simply enabling the transaction?
tfitz237 6y ago
What are you comparing this to that makes you think it is nuts? Square's is 2.6% + $0.10 Paypal's is 2.7% Fees directly from the merchant card issuers (Visa, Mastercard, etc) are sometimes lower (ranging from 1.4% - 2.6%, and even 3.5% for AmEx) but Stripe is a service that is on top of those fees , and any merchant will add on top of those fees as well.
- xtracto 6y ago
  > Fees directly from the merchant card issuers (Visa, Mastercard, etc) are sometimes lower (ranging from 1.4% - 2.6%, and even 3.5% for AmEx) but Stripe is a service that is on top of those fees , and any merchant will add on top of those fees as well. The way it works for "the networks" (Visa, Mastercard, Amex) is that they have several "interchange rates" ( https://www.helcim.com/us/pricing/visa-interchange-rates/ https://www.helcim.com/us/pricing/visa-interchange-rates/ ) which vary depending on the risk of the card [transaction]. "Flat fee" card payment providers win by setting an average flat-fee that they believe will be higher than the mixed (average) interchange range of the payers. Also, lower card rates can be obtained capturing what is called "level 2" or "level 3" data ( https://www08.wellsfargomedia.com/assets/pdf/small-business/merchant/level3.pdf https://www08.wellsfargomedia.com/assets/pdf/small-business/... ).
mchusma 6y ago
I think you are being downvoted for the tone, but I agree the problem stripe's customers face is 99% the large fees for credit card processing. Anything they can do here would be good.

Can stripe 1st work on reducing their fees? They're just like the incumbents. Only surrounded by more silicon valley sycophants. Taking 2.6%+ of every merchant transaction is nuts.

Throwaway1771 6y ago

Small businesses pay >2.9%+0.30¢ all the time.

elevenoh 6y ago
Yeah, it's sad to see. There's now no economic reason for these fees to remain so high. I worked at a payment processor.
- xtracto 6y ago
  Exactly! Credit Card fees are supposedly set according to risk. However, the way the networks are setup is a legacy from last century. The way I always think of it is like this: You would NEVER accept to pay to send an email per number of the words in that email, at the end of the day it is just transferring bytes. However the payments industry has been working like that for too long, why does the cost of sending some "money transfer" bytes be a function of the number you are sending? (like, sending $9156 is more expensive to transfer than $100000 bc of compression) That's why I joined Paystand [1] to do "Payment as a Service". Similarly how you pay a fixed monthly a month to receive emails, you should be able to pay a fixed amount to receive payments (using the Paystand network). Nevertheless, we have to support legacy networks such as Mastercard, VISA or Amex which still charge customers per transaction. [1] https://venturebeat.com/2020/02/06/paystand-raises-20-million-to-modernize-b2b-payments-with-blockchain/ https://venturebeat.com/2020/02/06/paystand-raises-20-millio...
  - manigandham 6y ago
    Aren't the fees about covering the transacted amount rather than simply enabling the transaction?

tfitz237 6y ago

What are you comparing this to that makes you think it is nuts? Square's is 2.6% + $0.10 Paypal's is 2.7% Fees directly from the merchant card issuers (Visa, Mastercard, etc) are sometimes lower (ranging from 1.4% - 2.6%, and even 3.5% for AmEx) but Stripe is a service that is on top of those fees , and any merchant will add on top of those fees as well.

xtracto 6y ago
> Fees directly from the merchant card issuers (Visa, Mastercard, etc) are sometimes lower (ranging from 1.4% - 2.6%, and even 3.5% for AmEx) but Stripe is a service that is on top of those fees , and any merchant will add on top of those fees as well. The way it works for "the networks" (Visa, Mastercard, Amex) is that they have several "interchange rates" ( https://www.helcim.com/us/pricing/visa-interchange-rates/ https://www.helcim.com/us/pricing/visa-interchange-rates/ ) which vary depending on the risk of the card [transaction]. "Flat fee" card payment providers win by setting an average flat-fee that they believe will be higher than the mixed (average) interchange range of the payers. Also, lower card rates can be obtained capturing what is called "level 2" or "level 3" data ( https://www08.wellsfargomedia.com/assets/pdf/small-business/merchant/level3.pdf https://www08.wellsfargomedia.com/assets/pdf/small-business/... ).

mchusma 6y ago

I think you are being downvoted for the tone, but I agree the problem stripe's customers face is 99% the large fees for credit card processing. Anything they can do here would be good.