Stripe Connect
Below is a simple breakdown of Stripe Connect its features, pros and cons.
The Basics:
Stripe Connect is a Payment Facilitator that handles payments for marketplaces & platforms. The main feature is the ability to collect payments from buyers and payout sellers all while collecting a fee for managing the marketplace.
Pricing:
- 2.9% + $0.30 per transaction.
- $2 per active seller. - Any account that processes a single payment in a calendar month will pay this fee.
- 0.25% of total account volume - This is in addition to the 2.9% + $0.30 per transaction.
- 1.5% for any other fees that you would like to charge your sellers that are independent of a transaction. - Ex: monthly membership fees.
- ACH fees are 0.8%
Chargeback Liability:
As a marketplace, you are ultimately liable for disputes, chargebacks & fraud. Besides for being on the hook for the transaction amount you will also pay a dispute fee of $15
Becoming a Payment Facilitator:
As your marketplace grows, you may want to move up the food chain and become a payment facilitator. As of September 2017, the only company that allows you to move up the food chain easily is Payrix.com
A great alternative to Stripe Connect would be Splash Payments