7 ms·

Working with the Stripe Payouts API

91 points by drusenko 13y ago

hayksaakian 13y ago
This is pretty neat. I wonder what the economics of this system will look like though. (100$ - Stripe fee to accept money) - Stripe fee to give money == ???
- tomschlick 13y ago
  the bank transfer fee is $0.25 USD. pretty standard for ACH https://stripe.com/us/help/pricing#transfers https://stripe.com/us/help/pricing#transfers
- deleted 13y ago
  [deleted]
- brackishlake 13y ago
  Right, so the important thing to keep in mind (and this is different from Balanced), is that you are making a standard Charge object. It's business as usual. When you pay money out to users, it is deducted from your Stripe balance. In that sense, the initial charge, and the transfer later, are not explicitly connected to each other. It's up to you to persist some business logic on the application side. In our case, we build in Stripe's fees (the standard 2.9% + $0.30) and make an assumption about our transfer fees (25 cents per transfer) to make sure we come out on top. The payer (when we create the Charge object) is paying this fee. That way, when I gift money to a couple, they are receiving EXACTLY what I intended to send them. We don't want the couple feel in any way like there's a "gotcha" — someone sent you $25, but you can withdrawal only $22! We are, of course, transparent to the payer about the additional fees they're covering. We let users withdrawal their full amount. This is in part to encourage fewer transfer fees, but it also simplifies things for our end-user. It's been great to work with Stripe. I can't say enough about the quality of their staff and the love and care they put into their API. It's something we should all appreciate and replicate. Chris
  - dclausen 13y ago
    > Right, so the important thing to keep in mind (and this is different from Balanced), is that you are making a standard Charge object. It's business as usual. From your example, Balanced will also let you factor in the cost of the processing and include it in your total e.g. 25 + 2.9% + 0.30 + 0.25. Then, you can specify the amount to pay out that is completely independent of the total amount processed. How is that different?
- hayksaakian 13y ago
  @brackishlake your account appears shadow/banned and your comment shows up as dead to most users. I wouldn't know why, but that's how it seems to me.
tomschlick 13y ago
> Their core product, enabling developers to charge credit cards, wasn’t the first to the market. It is, instead, the best. This is what I love about stripe. It may seem to an outsider like HN is full of Stripe fanboys but to someone who has worked with 10-20 other payment gateways its a godsend. Documentation that is simple, a reliable api, webhooks that work and a fantastic team behind it make stripe so much better than the other big players.
- joshowens 13y ago
  We use stripe for our app, http://follower.io http://follower.io, and it was sooo simple to get setup! I love how their docs even adapt to your account, showing you API calls with your keys already in it!
- icelancer 13y ago
  I've said this before, but each payment provider out there has benefits the others don't, which is a little annoying. For example, Balanced is inferior in almost all regards to Stripe except in one major area: Payment speed. Stripe offers 7-day rolling payouts (shorter for larger merchants), but Balanced offers next day payments and same day for Wells Fargo customers! Square offers same-day payouts and the best in-person dongle experience. But - and I have NO idea why this is - they offer no web API. Ridiculous. Stripe has the best third-party plugin support and best documentation. For now, I use Stripe, and they've worked with me to speed up payments. But you can't beat same-day payments that Balanced offers (I do use WF) and if Balanced ever starts funding and encouraging developers to work on plugins for major shopping carts, I will switch immediately.
  - pc 13y ago
    > For example, Balanced is inferior in almost all regards to Stripe except in one major area: Payment speed. We'll fix this.
    - brackishlake 13y ago
      This is something we experienced on The Wedding Favor. It was a trade-off we were aware of. On the other hand, it did trouble me that we were able to transfer money same-day to Chase bankholders with Balanced. It sounds great, but somewhere along the line that means that Balanced was "floating" our credit card charge and fronting the money to pay out to the end-recipient. While I appreciate this, and we benefit from very low chargeback rates (our users are friends and family), this seemed like a "too good to be true" risk. In Stripe's case, you can make the business choice in your logic to pay out quicker to your end user, so long as you understand the risks (which you assume) and keep a comfortable account balance to cover it. Payouts to you, the Stripe account holder, is another matter!
deleted 13y ago
[deleted]
zrail 13y ago
I love how simple Stripe's APIs are. This is a great overview of Payouts, thanks for posting. <shameless plug> I'm working on a guide to integrating Stripe with Rails and I'll be covering Payouts and Stripe Connect in a whole section about building marketplaces. http://www.petekeen.com/mastering-modern-payments http://www.petekeen.com/mastering-modern-payments </plug>
bifrost 13y ago
I love Stripe, they're so easy and so fast and SO PAINLESS. I've had to deal with "legacy" solutions and I basically hate them all. Stripe saved me significant implimentation time, so they are currently the ones to beat IMHO. Frankly they are what makes the easy user experience possible @ CryptoSeal (http://privacy.cryptoseal.com http://privacy.cryptoseal.com).
deleted 13y ago
[deleted]
iamleppert 13y ago
That's nice, but https://www.theweddingfavor.com/ https://www.theweddingfavor.com/ is down. At least replace your default nginx 5xx pages people!!
aquark 13y ago
How do you deal with fraud in this type of site? It seems like anytime you are offering a conduit between a credit card number and a bank account you are at risk of someone push a large number of fraudulent transactions through and hoping to cash out before the chargebacks start. Payment providers clearly have this problem (ie. Stripe does itself), but as a small startup it seems like a pretty daunting risk. Why not use Stripe connect in this case and simply get the couple to sign up for their own Stripe account?
- collision 13y ago
  It's user-dependent. Stripe provides users with some protections (e.g. against card-testing), and then users will verify their platform's sellers in a way that makes sense for them. Lyft and Sidecar collect drivers' licenses from drivers, and only pays them out in proportion to the amount they drive. Homejoy trains cleaners, and each user rates the cleaner. And so on. Fraud is heterogenous by nature.
  - aquark 13y ago
    Thanks for responding. It certainly makes a lot of sense for a business model like Lyft or Sidecar where their is a significant relationship between the company facilitating the payment and the service providers receiving payment. For the OPs case though there seems to be a huge amount of risk: a 'couple' sign up, then other 'friends' start sending them money.
kevinwmerritt 13y ago
From my reading of Balanced documentation, its on_behalf_of parameter allows a fledgling app to lean on Balanced for accounting. "in order to determine how much money you owe a specific merchant, you can easily query and all the outstanding debits tied to this merchant and subtract the payouts you've already done to the merchant." This seems like a nice advantage of Balanced especially if you don't want to go the Stripe connect route.
joonas 13y ago
As someone who has previously used Balanced and played around with Stripe enough to get a feel for it, I feel like I need to chime in here. Balanced initially reached out to me, and I initially somewhat dismissed them, because I didn't have the time to look in to their platform as I was busy building a marketplace product for which we thought we had already picked the payment provider for, PayPal. However, few weeks later I decided to take the time to investigate Balanced's offering and I was quite simply blown away by what they had to offer at the time (since then their offering has significantly expanded). As a result, I decided to make some time to rewrite our payments to use their APIs, because they solved the one hard problem I had yet to solve, which is the payouts. I distinctly remember that I had just spent the earlier part of that week going over the various alternatives to how we could handle payout, and none of them seemed optimal. While paypal certainly would've gotten the job done, it was far from ideal especially considering that our merchants would've had to sign up for a paypal account and the fact that they have a track record of mistreating individuals and businesses by freezing accounts and funds. The other alternatives I had considered would've been much more work to integrate with and would've probably eventually driven me up a wall. This was the first thing that struck me as the truly valuable feature of their product. When I actually began integrating with Balanced, my "developer relations" experience with Balanced has been quite the opposite. Heck, I had a phone call with one of the Balanced founders (Jareau) where he took the time to answer all of my questions and explain to me how everything worked. In addition, I was able to simply hop on to Balanced's IRC channel (#balanced on Freenode) and talk to their whole team right there and then in real time. When I had questions about any of the functionality, there would always be someone from Balanced's team available to answer my questions. I should also mention that even some people outside of Balanced (i.e. customers) are also helping out on that channel. Yet again, I was impressed. I never had issues with getting the kind of support I needed from Balanced, they are very responsive and helpful in solving any problems I have encountered. Not to knock on Stripe or anything, but I never quite felt like their product was suitable for the situation that Balanced is suitable, a marketplace that needs to do payouts (or nowadays I suppose anything that needs to payouts). I feel like Balanced really hits the sweet spot when it comes to payouts, and they continue to work hard on making sure that their product is the best that there is in that category, and I certainly think that is the case right now. One thing that I think bears mentioning is the fact that Balanced is also very receptive to customer feedback. In my experience, they are constantly weighing out what's the next thing they should be building/doing to make their customer's lives easier, and so their process is very much driven by the feedback provided by their customers (check out their API docs github to see the process in action, https://github.com/balanced/balanced-api/issues https://github.com/balanced/balanced-api/issues) Overall, I do think that Stripe and Balanced to have overlap in what they do for you (charging a credit card), but I also feel like both of them have their strengths in differing features. I do think that for marketplaces that need payouts, Balanced is vastly superior because of the feature set that they have built, but if you had to something like subscriptions, then Stripe would be the way to go.
ejain 13y ago
BrainTree is another option to consider: Their API seems to be as simple as Stripe's, and their pricing looks better (quicker payouts, volume pricing).
- forman00 13y ago
  I talked with BrainTree's customer support yesterday. They currently have a "payouts"/"marketplace" in beta. He should they should officially release it in the next few months.

91 points by drusenko 13y ago

This is pretty neat. I wonder what the economics of this system will look like though. (100$ - Stripe fee to accept money) - Stripe fee to give money == ???

tomschlick 13y ago
the bank transfer fee is $0.25 USD. pretty standard for ACH https://stripe.com/us/help/pricing#transfers https://stripe.com/us/help/pricing#transfers
deleted 13y ago
[deleted]
brackishlake 13y ago
Right, so the important thing to keep in mind (and this is different from Balanced), is that you are making a standard Charge object. It's business as usual. When you pay money out to users, it is deducted from your Stripe balance. In that sense, the initial charge, and the transfer later, are not explicitly connected to each other. It's up to you to persist some business logic on the application side. In our case, we build in Stripe's fees (the standard 2.9% + $0.30) and make an assumption about our transfer fees (25 cents per transfer) to make sure we come out on top. The payer (when we create the Charge object) is paying this fee. That way, when I gift money to a couple, they are receiving EXACTLY what I intended to send them. We don't want the couple feel in any way like there's a "gotcha" — someone sent you $25, but you can withdrawal only $22! We are, of course, transparent to the payer about the additional fees they're covering. We let users withdrawal their full amount. This is in part to encourage fewer transfer fees, but it also simplifies things for our end-user. It's been great to work with Stripe. I can't say enough about the quality of their staff and the love and care they put into their API. It's something we should all appreciate and replicate. Chris
- dclausen 13y ago
  > Right, so the important thing to keep in mind (and this is different from Balanced), is that you are making a standard Charge object. It's business as usual. From your example, Balanced will also let you factor in the cost of the processing and include it in your total e.g. 25 + 2.9% + 0.30 + 0.25. Then, you can specify the amount to pay out that is completely independent of the total amount processed. How is that different?
hayksaakian 13y ago
@brackishlake your account appears shadow/banned and your comment shows up as dead to most users. I wouldn't know why, but that's how it seems to me.

tomschlick 13y ago

> Their core product, enabling developers to charge credit cards, wasn’t the first to the market. It is, instead, the best. This is what I love about stripe. It may seem to an outsider like HN is full of Stripe fanboys but to someone who has worked with 10-20 other payment gateways its a godsend. Documentation that is simple, a reliable api, webhooks that work and a fantastic team behind it make stripe so much better than the other big players.

joshowens 13y ago
We use stripe for our app, http://follower.io http://follower.io, and it was sooo simple to get setup! I love how their docs even adapt to your account, showing you API calls with your keys already in it!
icelancer 13y ago
I've said this before, but each payment provider out there has benefits the others don't, which is a little annoying. For example, Balanced is inferior in almost all regards to Stripe except in one major area: Payment speed. Stripe offers 7-day rolling payouts (shorter for larger merchants), but Balanced offers next day payments and same day for Wells Fargo customers! Square offers same-day payouts and the best in-person dongle experience. But - and I have NO idea why this is - they offer no web API. Ridiculous. Stripe has the best third-party plugin support and best documentation. For now, I use Stripe, and they've worked with me to speed up payments. But you can't beat same-day payments that Balanced offers (I do use WF) and if Balanced ever starts funding and encouraging developers to work on plugins for major shopping carts, I will switch immediately.
- pc 13y ago
  > For example, Balanced is inferior in almost all regards to Stripe except in one major area: Payment speed. We'll fix this.
  - brackishlake 13y ago
    This is something we experienced on The Wedding Favor. It was a trade-off we were aware of. On the other hand, it did trouble me that we were able to transfer money same-day to Chase bankholders with Balanced. It sounds great, but somewhere along the line that means that Balanced was "floating" our credit card charge and fronting the money to pay out to the end-recipient. While I appreciate this, and we benefit from very low chargeback rates (our users are friends and family), this seemed like a "too good to be true" risk. In Stripe's case, you can make the business choice in your logic to pay out quicker to your end user, so long as you understand the risks (which you assume) and keep a comfortable account balance to cover it. Payouts to you, the Stripe account holder, is another matter!

deleted 13y ago

[deleted]

zrail 13y ago

I love how simple Stripe's APIs are. This is a great overview of Payouts, thanks for posting. <shameless plug> I'm working on a guide to integrating Stripe with Rails and I'll be covering Payouts and Stripe Connect in a whole section about building marketplaces. http://www.petekeen.com/mastering-modern-payments http://www.petekeen.com/mastering-modern-payments </plug>

bifrost 13y ago

I love Stripe, they're so easy and so fast and SO PAINLESS. I've had to deal with "legacy" solutions and I basically hate them all. Stripe saved me significant implimentation time, so they are currently the ones to beat IMHO. Frankly they are what makes the easy user experience possible @ CryptoSeal (http://privacy.cryptoseal.com http://privacy.cryptoseal.com).

deleted 13y ago

[deleted]

iamleppert 13y ago

That's nice, but https://www.theweddingfavor.com/ https://www.theweddingfavor.com/ is down. At least replace your default nginx 5xx pages people!!

aquark 13y ago

How do you deal with fraud in this type of site? It seems like anytime you are offering a conduit between a credit card number and a bank account you are at risk of someone push a large number of fraudulent transactions through and hoping to cash out before the chargebacks start. Payment providers clearly have this problem (ie. Stripe does itself), but as a small startup it seems like a pretty daunting risk. Why not use Stripe connect in this case and simply get the couple to sign up for their own Stripe account?

collision 13y ago
It's user-dependent. Stripe provides users with some protections (e.g. against card-testing), and then users will verify their platform's sellers in a way that makes sense for them. Lyft and Sidecar collect drivers' licenses from drivers, and only pays them out in proportion to the amount they drive. Homejoy trains cleaners, and each user rates the cleaner. And so on. Fraud is heterogenous by nature.
- aquark 13y ago
  Thanks for responding. It certainly makes a lot of sense for a business model like Lyft or Sidecar where their is a significant relationship between the company facilitating the payment and the service providers receiving payment. For the OPs case though there seems to be a huge amount of risk: a 'couple' sign up, then other 'friends' start sending them money.

kevinwmerritt 13y ago

From my reading of Balanced documentation, its on_behalf_of parameter allows a fledgling app to lean on Balanced for accounting. "in order to determine how much money you owe a specific merchant, you can easily query and all the outstanding debits tied to this merchant and subtract the payouts you've already done to the merchant." This seems like a nice advantage of Balanced especially if you don't want to go the Stripe connect route.

joonas 13y ago

As someone who has previously used Balanced and played around with Stripe enough to get a feel for it, I feel like I need to chime in here. Balanced initially reached out to me, and I initially somewhat dismissed them, because I didn't have the time to look in to their platform as I was busy building a marketplace product for which we thought we had already picked the payment provider for, PayPal. However, few weeks later I decided to take the time to investigate Balanced's offering and I was quite simply blown away by what they had to offer at the time (since then their offering has significantly expanded). As a result, I decided to make some time to rewrite our payments to use their APIs, because they solved the one hard problem I had yet to solve, which is the payouts. I distinctly remember that I had just spent the earlier part of that week going over the various alternatives to how we could handle payout, and none of them seemed optimal. While paypal certainly would've gotten the job done, it was far from ideal especially considering that our merchants would've had to sign up for a paypal account and the fact that they have a track record of mistreating individuals and businesses by freezing accounts and funds. The other alternatives I had considered would've been much more work to integrate with and would've probably eventually driven me up a wall. This was the first thing that struck me as the truly valuable feature of their product. When I actually began integrating with Balanced, my "developer relations" experience with Balanced has been quite the opposite. Heck, I had a phone call with one of the Balanced founders (Jareau) where he took the time to answer all of my questions and explain to me how everything worked. In addition, I was able to simply hop on to Balanced's IRC channel (#balanced on Freenode) and talk to their whole team right there and then in real time. When I had questions about any of the functionality, there would always be someone from Balanced's team available to answer my questions. I should also mention that even some people outside of Balanced (i.e. customers) are also helping out on that channel. Yet again, I was impressed. I never had issues with getting the kind of support I needed from Balanced, they are very responsive and helpful in solving any problems I have encountered. Not to knock on Stripe or anything, but I never quite felt like their product was suitable for the situation that Balanced is suitable, a marketplace that needs to do payouts (or nowadays I suppose anything that needs to payouts). I feel like Balanced really hits the sweet spot when it comes to payouts, and they continue to work hard on making sure that their product is the best that there is in that category, and I certainly think that is the case right now. One thing that I think bears mentioning is the fact that Balanced is also very receptive to customer feedback. In my experience, they are constantly weighing out what's the next thing they should be building/doing to make their customer's lives easier, and so their process is very much driven by the feedback provided by their customers (check out their API docs github to see the process in action, https://github.com/balanced/balanced-api/issues https://github.com/balanced/balanced-api/issues) Overall, I do think that Stripe and Balanced to have overlap in what they do for you (charging a credit card), but I also feel like both of them have their strengths in differing features. I do think that for marketplaces that need payouts, Balanced is vastly superior because of the feature set that they have built, but if you had to something like subscriptions, then Stripe would be the way to go.

ejain 13y ago

BrainTree is another option to consider: Their API seems to be as simple as Stripe's, and their pricing looks better (quicker payouts, volume pricing).

forman00 13y ago
I talked with BrainTree's customer support yesterday. They currently have a "payouts"/"marketplace" in beta. He should they should officially release it in the next few months.