When you pay by card on a website, a payment gateway processes it in the background. One of the best-known in the world is Stripe. It is behind the payments of countless e-shops, apps and online services. Let us explain what Stripe is, how it works and what it is used for.

What Stripe is

Stripe is a payment infrastructure that lets companies accept card payments on the internet. It handles the whole payment process, from the customer entering the card to the money being credited to the company. Simply put, it is a bridge between your website and the world of banks and payment cards.

Stripe is popular especially because it is technically very well made and easily connects to websites and apps via a so-called API.

How Stripe works

  1. The customer enters payment details on your website.
  2. Stripe securely processes and verifies them with the customer’s bank.
  3. After approval, the payment is credited to your Stripe account.
  4. Stripe pays the money out to your bank account on a set schedule.

As the operator you do not have to deal with sensitive card data, that is processed and protected by Stripe.

What Stripe is used for

  • E-shops and online sales. Accepting payments for goods and services, this relates to the article on how to build a quality e-shop or website.
  • Subscriptions and recurring payments. Ideal for services and apps where the customer pays regularly monthly or yearly.
  • Invoices and payment links. You send the customer a link to pay without your own e-shop.
  • Payments in apps and on platforms.
  • Online bookings and courses, where a payment must be taken in advance.

What Stripe offers on top

  • Security. It meets strict security standards for handling cards.
  • Support for modern payment methods including payment buttons on the phone.
  • Reports and tools for managing payments, refunds and subscriptions.
  • Fraud protection.

What to keep in mind

  • Fees. Stripe charges a percentage for each payment, which must be factored into pricing.
  • Availability. Stripe is not available exactly the same everywhere, check the conditions for your country and type of business.
  • Taxes and accounting. With Stripe you are the seller, so you are responsible for invoicing, VAT and taxes. If this is exactly what you want to avoid, a Merchant of Record may be the solution, which has its own article.

Stripe versus a simple payment button

For very small sales, a simple payment button or a service with minimal setup may be enough. Stripe is worth it where you want full control, integration with systems and a tailored solution, for example your own e-shop or an app with subscriptions.

Conclusion

Stripe is a powerful and reliable payment gateway that lets you accept card payments on the web and in apps. It suits e-shops, subscriptions and services and excels especially where a quality technical integration is needed. When deploying it, remember that you are the seller, so taxes and invoicing are up to you.

Want to accept card payments on your website or in your app? Get in touch, we will design and set up a tailored payment solution.