Ask HN: What are some low cost payment processing alternatives to Stripe? I'm looking to process ~20k transactions a month with an average ticket size of $15 per transaction. Would ISOs(Independent sales organizations) with sponsor banks be good options to consider? |
I thought these services were already widespread.
Are people still paying for debit and credit cards?
Because you can choose which processor you want to use and there are many low-cost ones, including some inter-bank ones with fixed cost (no %)
Most shops like WooCommerce and Shopify have ready-to-use plugins for it.
(I'm not affiliated, but i build e-commerce for brands)
1. https://github.com/juspay/hyperswitch
(not affiliated with this project in any way)
I can't seem to figure what their pricing strategy is or who's running it.
> Free-tier > Free-tier for startups. Lowest Price for others.
Not sure what their minimum viable throughput is though ...
> We do not have monthly fees, set-up fees, integration fees or closure fees. We do have a minimum invoice depending on industry or business model. Please speak to a member of our sales team for more details.
Unfortunately they seem to have stopped working on their main payment product for years and it stagnated.
I asked a sales rep years ago if they have plans to integrate Amazon Pay. He said yes. It is still not available. They have Apple Pay, but not Google Pay. After PayPal, these wallets are the most important payment methods in e-commerce here, yet they don't seem to know this and/or refuse to add them for whatever reason.
Instead they now offer loans that are repaid with a percentage of sales. The conditions are horrible. Probably related to selling a good amount of shares to Blackstone PE in 2021.
So the enshittification has started. I guess they are working towards an IPO, so price hikes will probably come, too. Hope they prove me wrong and turn it around.
As I said, this was a couple years ago, so things might be very different now (we might've been an outlier even back then), but it left a bad taste, because the customer service was so unhelpful, even though they were much smaller than stripe.
Great for those starting in Europe, it seems. And PayPal!!!!
Their documentation is spotty, they don't inform customers about required changes to an implementation, and most importantly their failed transaction rate is much much higher than other processors I've worked with.
Based on the info they shared:
• Braintree: 2.59% + $0.49
> Braintree fees: $17,570 cost for 20K txns/month ($15 AOV)
• Stripe: 2.9% + $0.30
> Stripe fees: $14,700 cost for 20K txns/month ($15 AOV)
So Stripe is around 16% cheaper for their use case on standard pricing alone.
I use them for their direct integration with paypal, who owns them
In contrast, I almost feel like Stripe is innovating too much. I wish they stopped product development, no more redesigns, no more API breaking changes, it already "just works" so why rewrite and "improve" everything endlessly.
You lose the developer friendliness, so you'll have to debate if that matters to you. To me it never did.
Or you could take a look at stax https://staxpayments.com/
Their pricing is actually insane as they charge per API call rather than transaction amount. That sort of pricing made sense for TaxJar because it was their whole deal, but post-acquisition it would've made more sense to treat the tax product as a complement to the core business and just tack on a small 50c fee for successful tax collection.
Are there any plans to have a marketplace offering?
We are now with mxmerchant and they are okay? I’ve never seen a credit card merchant go down and not take transactions, but in the 1.5 years we’ve used them, they’ve gone down twice.
But we need to use them because they are the only processor the software uses and we need to now take cards through their system
I think you meant "not entirely true". Yes, there are other options.
Assuming $250k per year at $15/transaction gives ~16,666 transactions a year. With base Stripe pricing, that means you're paying $5k for the $0.30 per transaction fee and another $7.2k for the 2.9% interchange plus fee. So $12.2k in fees per $250k processed, or 4.9% of processed dollars. Adyen is probably going to be about the same given your volume.
It's important to know that Stripe charges the same fee even though the fee for processing American Express is different from Visa, which is different from Discover and all are more expensive than debit cards. If your business skews highly towards American Express, than Stripe is actually giving you the best rate you could hope for. If you're volume skews debit cards, than Stripe is giving you the worst rate.
I don't think Stripe loses any money on a transaction. All interchange rates are less than 2.99%, but some are very close. For very low volume/low ticket price, stripe is a pretty good deal. But if high volume, there's bound to be a better option that pays off considerably the sooner you implement it.
Now, if you can get most of your customers using debit cards or ACH-type transactions, you can really achieve a low cost if you use a processor with interchange-based pricing.
Why support American Express? Their members tend to be better customers in my experience, and they appreciate that you support their preference.
Last time I checked, there were a few choices (besides Stripe and PayPal), but many supported either only JPY, or only one time payments...
If you want to pay less, you have to use local processors with local currencies. This would be a complex operation.
1. Establish a company at that jurisdiction 2. Make agreements with processors, it could be banks or wallet providers. 3. You need a treasurer (or CFO) 4. Foreign Exchange rates will be a concern after a while.
Mentions Adyen, Braintree, and Paddle
Check out: https://atlas.scoutflo.com/?q=stripe (They have listed all open source, stripe alternatives)
But what other tradeoffs are you implying there to be? I understand in a vague sense that payment processors deal with a lot of ugly behind-the-scenes stuff like mind-boggling varieties of frauds, dispute resolutions, regulations, etc., but what exactly is the difference in this specific case, and how might it affect a potential user in practice?
If you're doing ~$300K/month, it’s likely you would've already spoken to our sales team and we would work out custom pricing for your business.
Nothing against them, just went a different route
Stripe are awesome for that (can appreciate the costs stack up internationally though). At your avg transaction size I'm not sure I'd know anything cheaper that's worth the extra work.
Best of Luck!
Juspay is an Indian payment aggregator. They are quite big and are used by high profile brands: https://juspay.in/
Crazy that we live in a world where 3% is “a good deal”. In Europe the fees are capped at 0.15%, and I’m sure even that is well above the true costs of payment processing. Interchange fees are such a clear case of market failure that I’m surprised they haven’t been regulated.
I was told by an insider that the reason why emv+pin is not used in the US is because Visa/MC actually profit from fraud. If fraud were cut considerably, you could argue that the network is only providing 5-10¢ of value per transaction, and cut their rates with legislation.
If we went to a system like PIX in Brazil, and dropped rewards, we could do away with most of the industry. People would only use credit cards if they needed credit.
Maybe we'll see some legislation in the future.
> they are all essentially the same when it comes to functionality and pricing because they are the middlemen between you and visa/mastercard/... and not much else
Which is false, as there are many payment providers using fixed cost models and not touching the CC networks. And in a lot of countries this is the main method of online payments instead of credit cards.
I would not say it is exactly the same as in the US.
[1]: https://www.thuiswinkel.org/media/oyhhmgvy/infographic_thuis...
So it makes me wonder why global companies like Google are so "credit card" centric. For example. You can attach a debit card as a payment mechanism for Google cloud services, but it can't be a top up one... Why? It is very annoying I have to open an extra account with overdraft block just to maintain some control on the spending if they suddenly decide to charge a wrong amount.
Generally, you'd have to have your bank account hacked to have a reason to reverse a charge on these types of systems. It happens, but very, very rarely and the banks have a lot of reasons to make sure it doesn't happen. That or you gave money to a scammer and that's your own fault (but they'll still help you).
This is why the fees are much, much lower. Often these systems even verify that you actually have the money and can transfer the amount to your business bank account on the same day. You can't do that with credit cards.
What I just described is also what Visa and Mastercard are.
While the graphic might be nice marketing for Ideal, I wouldn't categorize it as separate from debit/credit card.
The price above includes the entire payments stack (filing and remitting of taxes too), so you're compliant globally out of the box.
We often help teams avoid having to hire lots of external accounting resource.
Happy to chat if you'd like to learn more :)
We find that payments getting accepted is dependent on a whole number of things and having the ability to re-route and retry based on the location of the transaction massively helps boost chances of it going through.
You're absolutely correct in that haha - we exist to make sure teams don't have to do all this work internally themselves, as it becomes increasingly messy the more you grow.
Can I ask what category of product it is you're selling?
Is it really that merchant-friendly / anti-consumer? I have used chargebacks when merchants fail to deliver as promised, even when most people wouldn’t call them “some scammer”.
For instance recently a package was shipped that didn’t include one of many items. I asked for a refund, they claimed it was in the package. No worries, I’ll just do a chargeback.
Bank transfers and other direct methods are only an advantage for the seller and gives no advantage to the customer. That's why businesses that don't accept credit cards lose customers.
> You can't do that with credit cards.
Yes, you can. Stripe has same-day payouts, as do many more.
Every time I login I have to verify my identity (or use faceid on my phone). The bank account is basically unhackable without my physical presence.
Thus using something like ideal, there’s no need for fraud protection because it makes damn sure it’s you and asks like 4 times that you are sure.