Providing convenient and secure payment processing is an important part of any online store, but evaluating the variety of options available to small businesses today can be difficult. This article will give you a better understanding of what Stripe is, how it works, how to set it up, its main features and benefits, and how it compares to other options. After reading this, you should have a clear understanding of how Stripe works and whether Stripe is the right payment processing system for small businesses.
What are stripes?
Stripe is an online payment processor and payment gateway that enables customers to securely pay for products and services online. When your customers are ready to buy online, they can send payments through Stripe. Stripe processes payments, communicates the success or failure of transactions to customers, and ensures funds are properly routed to businesses.
Stripe has developed integrations with popular ecommerce website builders (such as WooCommerce and Shopify) and also offers a set of tools and APIs to give businesses more flexibility in how they integrate payment functionality into their sites. I’m here. Stripe is a popular payment processing system. Used by businesses of all sizesfrom Atlassian and Lyft to small e-commerce stores.
Payment methods accepted by Stripe
Stripe supports a wide range of payment methods, making it a very convenient option for customers. Stripe accepts:
- All major credit and debit cards (e.g. Visa, Mastercard, American Express, Discover, etc.)
- ACH payment (i.e. bank account transfer)
- Digital wallet (Apple Pay, Google Pay, etc.)
It can also support buy-now-pay-later style services, such as AfterPay. Stripe payment methods work both online and in person, making it a great option for businesses with online and physical stores.
How does Stripe process payments?
Stripe acts as both a payment processor and a payment gateway, so it covers everything you need to process payments online. Here’s an overview of how Stripe works:
1. Customer submits payment information.
Customers share their credit card, debit card, or other payment details using an online store’s checkout page or a face-to-face retailer’s point-of-sale terminal (such as a card reader).
2. Stripe securely transmits payment information to the acquiring bank.
When a customer submits payment information, Stripe encrypts these sensitive information and securely transmits them to the bank that processes the transaction (i.e. the acquiring bank). Stripe has used several different buying banks, including Wells Fargo. Sellers do not need to have a dedicated account with the acquiring bank. You can benefit from using a Stripe seller account for these transactions.
3. The acquiring bank connects with the issuing bank.
When the acquirer receives a payment request, it connects to the issuing bank associated with the customer’s payment method (eg, if the customer has a Citi Visa card, Citi is the issuing bank).
4. The issuing bank authorizes the payment and transfers the funds to the acquiring bank.
If the customer has funds available, the issuing bank approves and approves the payment, transfers the funds, and sends them back to the acquiring bank.
5. Stripe tells customers about success.
The acquiring bank tells Stripe of the success, and Stripe passes this message on to the customer (for example, the customer sees the message “Your order was successful!” on the checkout page). From the customer’s perspective, the entire process takes just a few seconds.
6. Stripe will transfer the payment to your bank account.
Once the issuing bank completes authorization (often the same day), Stripe deducts payment processing fees and makes a payment to your business bank account. It may take several days for the funds to appear in your bank account, and some merchants use payment schedules that transfer payments on a regular basis (such as weekly).
How to set up and use Stripe payment processing
Now that you understand how Stripe works, let’s take a look at how to use Stripe as a merchant. The focus here is on how to set up Stripe for your ecommerce website.
Step 1: Sign up for a Stripe account
If you haven’t already done so, you should start by Sign up for a Stripe account. It’s a relatively straightforward process where you enter basic contact details, business information, and bank account details. Once your account is verified, you can proceed to Step 2 or take your time to configure additional settings such as two-factor authentication.
Step 2: Integrate Stripe with your online store
Integrating Stripe with your online store depends on your ecommerce platform. Luckily, Stripe has pre-built integrations with most major ecommerce platforms, including: Woo Commerce, shopify, big commerce, more. This means you can start using Stripe in your online store with just a few clicks, without developer assistance.
If you have a completely custom site that isn’t built on top of an ecommerce platform, you’ll need developer help to build a direct integration with Stripe on your site (if you’re new to coding) .striped offer Extensive developer documentation Support custom builds.
Step 3: Run a test transaction.
Before deploying Stripe to your customers, it’s a good idea to run test transactions to make sure everything is working correctly. The steps here may vary depending on your ecommerce platform, but you may be able to enable test mode to see if Stripe can connect and communicate correctly without actually handling live transactions. . Alternatively, you can test a live transaction and then refund yourself from your store’s dashboard.
This gives you the chance to experience what it’s like to use Stripe as a customer and see how those payments appear in your Stripe dashboard.
Step 4: Start selling.
After successfully completing your test transaction, you’re ready to start processing payments with Stripe. Disable any test mode you may have turned on in the previous step and start selling.
Advantages of stripes
Now that you know how Stripe works and how to set it up in your online store, let’s take a look at some of Stripe’s key benefits for small businesses.
Integration with ecommerce platforms and website builders
As mentioned above, Stripe integrates with many popular ecommerce platforms and website builders. This is a huge advantage for small businesses as it means you can get Stripe up and running on your site without touching a single line of code. In addition to the speed of setup, this also means that you can expect excellent support and ongoing quality of life improvements as the integration improves over time.
Infinitely customizable and developer-friendly
There are many pre-built Stripe apps and plugins, but sometimes you need to tweak Stripe to meet your site’s specific needs. In those cases, it’s nice to know that Stripe is well known for being developer-friendly and open to customization. Stripe comes with great documentation that allows developers to easily customize Stripe to their specifications.
Seamless payment experience
Your site’s payment experience can have a noticeable impact on your conversion rate (that is, the rate at which your customers make a purchase on your site). A seamless experience can improve conversions, but a clumsy or slow process can cause customers to abandon purchases. Stripe provides a streamlined and user-friendly payment experience, helping more customers who initiate checkout successfully complete it.
Fast onboarding and extensive reporting
As you may have noticed during the setup process, signing up as a new Stripe customer is easy. Most notably, Stripe’s customer will automatically use her Stripe’s own merchant account for payment processing instead of having to go through the long and difficult process of setting up a merchant account with an acquiring bank. . This is a huge time saver for small business owners.
Stripe users also benefit from extensive reporting capabilities via the Stripe dashboard. Stripe reports give you a clearer picture of the health of your business with clear tracking of payment activity, transaction fees, and payments.
Are Stripe payments secure?
Stripe comes with extensive security and fraud protection features, making it one of the safer options for accepting payments on your store. Stripe is a Certified Level 1 PCI Service Provider. This means it adheres to the very strict security standards set by the PCI Security Standards Council. You can be confident that your customer’s payment information processed by Stripe is safe.
Online fraud is a serious problem for ecommerce stores, and Stripe offers advanced fraud detection. stripe radar service. Built directly into Stripe, this feature helps you proactively identify and prevent fraudulent charges, protecting your customers and your business. Additionally, Stripe can support features such as:
These provide even stronger fraud protection, but be aware that using these features can impact your transaction fees.
Is Stripe right for your business?
Not all businesses are created equal. There are many factors that determine whether Stripe is the right payment processing solution for your business. Stripe is great for small businesses that:
- Use popular e-commerce platforms. Stripe has direct integrations with WooCommerce and Shopify, making it a great option for businesses built on these platforms. You don’t have to spend valuable time and resources building and maintaining connections with Stripe.
- I have security or fraud concerns. If you’ve ever been the victim of fraudulent claims or bad actors, you know how much damage it can do to your business’s reputation and bottom line. Stripe’s advanced fraud protection and top-notch security make it a great choice for security-conscious merchants.
- We sell internationally. Stripe is supported on 40+ countriesTherefore, it is a smart option for companies with international sales.
- Be mindful of customization. Stripe is very developer-friendly, which makes it attractive to businesses that want the option to customize Stripe for their store’s unique needs.
- We want to give our customers choice. Stripe supports a variety of payment methods (credit cards, debit cards, ACH payments, digital wallets, buy now/pay later, etc.), giving customers great flexibility in how they pay for products and services is possible.
However, Stripe isn’t for everyone. Stripe cannot be used to sell certain high-risk products (check the product list). restricted business to ensure that our products and services are supported by Stripe). Additionally, Stripe charges a hefty transaction fee of 2.9% + 30¢ per online transaction, so it may not be a cost-effective option for all businesses.
How does Stripe work with GoDaddy?
GoDaddy users will love knowing that Stripes integrates seamlessly with GoDaddy’s website builder and online store solutions. Add Stripe as a payment processor and gateway to your GoDaddy site or storefront with just a few clicks. For more information on connecting your GoDaddy store to Stripe, managing your Stripe orders, and more, click here.
What are the alternatives to Stripe?
Stripe payment processing is a popular and reliable solution, but there are also more affordable alternatives that work well for your business. These options vary in terms of transaction fees, customizability, international sales support, and integration with other apps used by your online store. Examples include:
When considering your payment processing system, be sure to consider these transaction fees and which features are most important to your business. Ideally, you would choose a payment processing system that offers the features you need at an affordable price so you don’t overpay for features that aren’t critical to your business.