[poxrud]

Based on your comment you're clearly not a Stripe user, so I'm not sure why you felt the need to post this.

If visa/mc/amex are so much better, people can use them.

Stripe uses visa/mc/amex, it is not a competitor. You completely missed my point. Stripe uses visa/mc/amex to process credit card transactions, then when a refund is issued the CC companies return the charged amount to Stripe, but Stripe does not return the full amount back to the customer. They keep a percentage. This is what I consider "borderline fraudulent".

Charging a flat fee for a service doesn't seem that fraudulent to me.

But it is not a flat fee. They keep a percentage of the refunded amount. So if a customer bought a $1000 item, then changed their mind and cancelled the order 5 min later, Stripe would still keep $40 just for the fun of it. A small flat fee to cover network expenses would be more appropriate, not a percentage of the amount.

[bill_mcgonigle]

> Stripe would still keep $40

So you have to charge $1000 + ($40 * % of users who return + cushion) for the product. That means non-Stripe businesses can start to out-compete you on cost.

What makes it so that Stripe has such a unique position and can impact your costs and competitiveness to such a large degree?

> A small flat fee to cover network expenses would be more appropriate

That sure seems like the solution a free market in processing would settle on. Something is up.

[poxrud]

So you have to charge $1000 + ($40 % of users who return + cushion) for the product. That means non-Stripe businesses can start to out-compete you on cost.*

If you charge your customers more you will still end up paying more. The $40 was based on a 4% fee. (I'd like to make a correction, as in my case it is actually 3.5%)

What makes it so that Stripe has such a unique position and can impact your costs and competitiveness to such a large degree?

Stripe and PayPal are the biggest players in this space. There are others but they are either built on top of these two or do not have the easy API's and/or integration with other 3rd party services. PayPal was the first to start keeping the fees for refunds, and then Stripe followed.

Stripe is a great company otherwise, and I will continue being a customer but that doesn't mean that I can't get upset over such an blatant money grab.