Unfortunately for many small startups and sole traders on the web getting a merchant account for online payments isn’t the easiest thing in the world. Combine that with the PCI compliance hoops, and having to worry about monthly fees, and all of a sudden things get complex, financially and practically.
To be taken seriously on the web for payments, and for high ticket items, its often a necessity to get credit card processing support implemented on your site. Paypal, unfortunately doesn’t cut the mustard, and with its associated problems, ‘small fry’ feel and speed of fund delivery – its often out of the question for many indie developers. This recent post from Zach Inglis airs the frustration of many startups on this very topic.
Enter Stripe, a startup launched this week that aims to bring credit card processing to the masses, without the associated headaches and hoop jumping that prevents many businesses from getting off the ground. Stripe has no monthly fees or setup costs, and they make their money by taking a processing fee. 2.9% + 30¢ per successful charge, royally kicking Paypal’s arse – which is currently at 3.4% for receiving funds.
Technically, Stripe is implemented via RESTful API calls to their servers. As with most payment APIs, You authenticate against the server, send the details of the transaction for processing, and await the response from the Swipe servers. There are both ‘live’ and ‘test’ mode keys that give developers the opportunity to quickly deploy a fully functional solution with minimal effort. A variety of prebuilt libraries on top of Stripe have already been built, making rapid deployment even easier. A notable inclusion in their feature list is full support for recurring payments. First, you define the subscription plans you want to offer, and then you sign up customers for one of those plans. Swipe handles the rest of the process.
You don’t need a merchant account or gateway. Stripe handles everything, including storing cards, subscriptions, and direct payouts to your bank account. There is one caveat however, you need a US bank account to receive payments, but even for international customers, that may be easier than persuading your bank manager that your idea has legs. The team are however currently working on non-US support for the service.
Positioning themselves as something of a trailblazing startup, Stripe are leading the way for more accessible e-commerce for everyone. I only hope that the service is rolled out in other countries as well as the US, and that the validation of the concept opens the floodgates for others to follow suit.