The Story Behind Stripe: Why They Are the Leading Online Payment Solution

We are witnessing a growing demand for in-app payments. But while many think that they would welcome this kind of convenience with open arms, in reality - they question the level of security that comes with it. Consequently, for a long time, everyone was too scared to invest in developing new solutions, worried that there’s no way they would pay off. 

But not Stripe. 

Stripe was one of the bravest players on the market. They dared to come to grips with issues surrounding the payment universe and provide answers of their own. Today, they offer an API for payments and represent an end-to-end payment solution that enables self-service SaaS businesses to easily integrate payments into their software. 

Stripe’s reliability in terms of security is one more thing that showed to this skeptic world that a third-party integration can be the safer option. With breaches becoming more sophisticated, not all development teams have what it takes to build effective firewalls: only the most skilled and experienced developers who are one hundred percent focused on security. Thus, instead of wasting valuable resources on a dedicated in-house team, an investment in plug-and-play solutions like Stripe became a much more convenient and affordable alternative. 

What makes Stripe so unique

Founded more than 10 years ago, Stripe’s main focus was on developing APIs that would help handle literally every part of the payment process: from accepting and processing payments to reconciliation. 

From the get-go, they took the developer-first approach. Their simple code enabled simple integration. 

Furthermore, thanks to their PayFac technology, all the hurdles related to the process of setting up online card payments were gone. And because Stripe was built on just a few lines of code, successful SaaS businesses jumped to capitalize on the simplicity of its integration. Plus, unlike most of its competitors, Stripe built extensive documentation to provide an additional layer of support for its partners.

As you may have guessed, all this triggered a fast expansion of their user base, along with a significant surge in revenue. At the moment of writing, they are valued at $95 billion and considered one of the most valuable global unicorns.

Today, Stripe universe offers way more than smart and secure payment solutions. They offer a range of complementary services with three main goals in mind: to support merchant partner growth, boost the growth of the Internet economy, and enable online commerce. 

Their most notable products are:

  • Stripe Connect, for complex marketplace transactions;
  • Stripe Billing that helps optimize subscriptions and invoice management; 
  • Stripe Radar, a set of ML fraud prevention tools;
  • Stripe Payouts and Stripe Issuing for instant cashouts for gig economy;
  • Stripe Terminal that covers offline retail payments;
  • Stripe Atlas and Stripe Sigma used for business analytics and reporting;
  • Stripe Treasury that helps with offering embedded banking as a service;
  • Stripe Climate that allows businesses to direct a part of their revenue towards carbon reduction and removal.

But let’s dive deeper into what all this actually means. 

Stripe features & benefits

Stripe was the highest rated out of 10 global payment providers due to the range of unique and practical features it offers for a variety of businesses. In fact, a 2018 IDC report shows that Stripe helped businesses increase their revenue by more than 6% and lower the costs of operations by 24%. They can also guarantee far fewer unplanned outages and higher developer productivity. 

Stripe screenshot
Stripe screenshot

 All in all, some of the greatest Stripe benefits include:

Customization and flexibility

For developers, Stripe’s API that is backed by detailed documentation is perfect for building unique eCommerce experiences. For startups and SMBs that don’t have the means to hire a skilled development team, Stripe offers an array of pre-built store pages, integrations, and configurations. However, note that this comes at an additional cost. 

All-inclusive payment options

It is also possible to prevent revenue losses caused by a sole focus on online customers. With Stripe Terminal, businesses can process in-person payments and serve the needs of their in-store customers, at the point of sale, keeping their customer base diverse and their sales volume high.  

Highest security standards

The company’s fraud protection tools based on machine learning mechanisms maximize the safety of all transactions. The smart algorithm learns from data collected by millions of global companies but also adapts easily to the changing fraud patterns of your business. Also, by applying Dynamic 3D Secure for high-risk payments, it gets much easier to recognize real customers and weed out scammers. 

Versatile payment options 

Stripe supports countless payment methods, including online credit card processing, mobile payments, cash-based vouchers, bank redirects, buy-now-pay-later options, and more. Furthermore, they continue to develop services suitable for all businesses, from eCommerce merchants with high volume transactions to SaaS companies that need dependable solutions for recurring payments.

Simple payment setup

Stripe users can choose whether they wish to customize their payment form or integrate a dynamic payment page that will adapt to the customers’ devices. 

Global reach

Stripe is currently available to merchants in more than 40 countries and is planning to expand its reach in the years that follow. It supports more than 135 currencies and helps its users navigate any local policies. 

Excellent support program

While their documentation serves as the main (and usually the only necessary point of contact), businesses can get in touch with Stripe’s support team on discord 24/7 for any questions and issues that need to be resolved immediately. 

Costs

On Stripe’s website, you’ll come across two pricing plans: 

  • Integrated plan, a pay-as-you-go pricing option
  • Customized plan, available for businesses that expect high payment volumes. As a part of this plan, users can get additional discounts and specific rates

The standard online credit card transaction fee is (2.9% + $0.30) but enterprises can apply for a volume discount. Non-profits, as well, can get reduced rates (2.2% + $0.30) and no fees will be charged on the first $15,000 in sales volume.

When it comes to their API, Stripe offers free access for companies that want to integrate payments into their own systems instead of redirecting customers to third-party sites. 

Alternatives

Although Stripe is still leading the pack as one of the strongest industry players, the market is becoming more competitive as we speak. If, for whatever reason, you question Stripe’s compatibility with your business plan, you can check out some of its greatest competitors:

PayPal

PayPal is a common choice for businesses that are looking for the simplest online payment system. It is in the same price range as Stripe and comes without any monthly fees. The setup for an eCommerce store is simple, but comes at a heftier price if you want it built into the website. PayPal is highly praised for serving both online and offline customers by offering card readers for brick-and-mortar stores. 

Braintree

Another product from the PayPal family, Braintree matches Stripe in terms of price and has no overhead monthly fees (except in the case of AMEX transactions that are charged an additional $0.15). It is a popular choice among those who want to accept PayPal payments since it can be built into your checkout process, which is not the case with Stripe. Braintree offers an excellent suite of developer tools and integration options, but is known for long setup times.

Square

Square offers features similar to Stripe, and the choice between the two mostly boils down to the developer’s preference for one of the two APIs. Square grew in popularity due to its range of options: online order management, inventory management, in-app purchases, card readers, reporting tools, and more. Still, it is second-to-Stripe in terms of coverage and the number of integrations. Nevertheless, businesses appreciate their predictable flat-rate pricing packages that come without additional monthly fees.   

Amazon Pay

Although it started as a convenient payment solution for Amazon sellers, Amazon Pay showed to be quite beneficial outside the Amazon ecosystem. In addition to its easy setup and integration, Amazon Pay boasts an exceptional fraud protection system. While they don’t lock you into any long-term contracts and their flat-rate pricing starts at 2.9% + $0.30 for domestic transactions, Amazon Pay is still quite expensive for high-volume merchants. 

Stripe for Node.js developers

As we previously explained, Stripe’s simple code makes it a favorable payment solution among backend developers. What they particularly appreciate is the extensive documentation that clearly explains how to use their API to incorporate it into a specific project. 

And with JavaScript being by far the most commonly used programming language, the Invigoo developers were interested in seeing how Stripe works with Node.js. Here’s what we’ve noted:

  • Customization and flexibility. With Stripe, we were able to build business-specific solutions and adapt them to the needs of end-users. 
  • Automatic pagination. Pagination prevents loading too much data at the same time, and with Stripe automation, coding time is reduced.  
  • Typescript binding support.
  • Detailed errors-focused documentation.
  • Quick-start documentation, perfect for development teams that prefer to get down to business as quickly as possible. 

It is also worth mentioning that Stripe keeps the library up-to-date, which automatically puts developers in a position to regularly update their package.json, but it’s all in an effort to minimize the number of issues. 


We here at Inviggo are pretty loud Stripe advocates. We’ve already successfully incorporated it in several products we built for telehealth and other clients who needed a secure in-app payment option.