Why is this such an important news? Do people regularly use instant pay out? I would think that it's mostly for emergency situations. Normal payout is still free.
It's apparently lower than "I made a raycaster in 256 bytes" and higher than "I got banned from Stack Exchange for not supporting Israel". I can't really tell where the bar is.
For gig workers, instant payout is a nice deal and increases the value of the platform, so being able to flow from customer to worker seamlessly is a value add.
I'd guess advertisers might like this feature as they could do:
- Buy ads targeting your page selling stuff (for example a course)
- Generate revenue
- Instant payout
- Repeat
In this flow you don't need to wait 1 month for a payout so you are not limited doing this once a month, you can do this for example 12 times a month therefore generating much more revenue.
I get stripe was YC, but its basically handling the entire SaaS economy at this point, and then some. 1 trillion dollars flew through the platform in the past year, which is similar to paypal
for Fintechs who're using Stripe as a way to allow users to purchase stock/remittances/e-wallet balances etc. instant payouts are very important since in most cases people who load with stripe also consume those funds on the platform instantly
The last time I created an invoice manually it tried to upsell me on a far more expensive plan just so I can group things on an invoice. Even worse, adding a recurring product to a quote results in an upsell.
It’s honestly embarrassing. Feature-gating things with 0 marginal cost feels desperate.
Their payment links take on the form of buy.stripe.com/<id> but they added the ability to use your custom domain for $10/mo ... Why isn't this baked-in?
What would be the reason for them to boost this fee right now? Is it just a pure profit play? That is, they think they can extract more cash from the people who are reliable instant-payout users (rather than losing them to standard payouts)?
Does this portend anything for the company, in the way that not backfilling positions means that layoffs may be imminent? Or perhaps a corporate transaction like an IPO?
For any payment processor part of the fees you pay go to offsetting fraud (it is a cost just like servers or people).
Instant payout is much riskier because if a bad actor is using Stripe to cash out stolen credit cards they have less time for the banks to detect and report it before the money is gone. As a result it has a higher cost to the company.
Genuine question: Is fraud actually something that costs Stripe money when it comes to payouts?
The reason credit card fraud for charges costs money to processors is because of charge backs. I believe charge back fees originate from the card networks themselves (Visa, MasterCard, etc). These processors also enforce a variety of limits when it comes to chargebacks for each merchant. This means if you're the layer between the merchant and the network, the merchants generally will rely on you to pre-emptively detect fraud. Those systems all cost money too.
As far as I know when it comes to payout rails such as ACH, real time payments (RTP), Zelle, I don't believe the payment processor holds any liability for fraudulent transactions. In other words, if a fraudulent payout occurs through stripe via RTP then The Clearing House banks aren't going to come after stripe for the money. They'll tell the end user "whoops, should've taken better care of your digital info. Bye!"
source: Worked at a payment processor and worked on payout rails and integrating with banks. Also do work now as an end user of a different payment processor that does charging, payouts, etc.
Yeah I'm wondering why it's happening now. Is there an indication that fraud is going up, and that's why they're raising the fee? Given the percentage increase, it would have to be a pretty dramatic increase.
> Navigate to the Payouts section of your Balances page
> Filter by “method”
I have no "method" filter on that page, only "date", "amount" and "status". Also they talk about 2 business days payments as default but in the settings you can only choose between automatic every day / week / month.
Since the instant payout is kind of a loan and you have to request it, pretty sure it doesn't affect me but it's all very confusing.
Stripe could choose to support FedNow instant payments and push these funds for pennies (up to $100k at a time), assuming the receiving institution hosting the deposit account(s) is set to receive on those rails. They would arrive within 20 seconds, per FedNow’s SLA.
Only costs ~$25/month to plug into these rails, plus a few cents per transaction.
exactly. so tired of people saying: huehuehue this is correct, its just 50% comon bro the only reason i clicked is because i was like: wtf you need to pay 50% fee of the 100%?
i dont care about anyone trying to say: huehehue thats how its written. no its not.
but yeh i guess ppl rather focus on shitposts and talk endlessly
The title feels a bit disengenious. Technically, yes, it was increased by 50% of what it was, but it is a shift from 1% to 1.5%, not up to 50% of each transaction.
The title is correct. But I agree that saying "50% increase" conveys less information than saying "1% to 1.5%" (because you don't know 50% of what), and seems to have been used only to make the title more dramatic.
Although rare, I use instant payout for my small business. It's a lovely convenience and the extra 1% hit (on top of the usual transaction fees) can be a worthwhile tradeoff. I can't explain it, but the new 1.5% fee killed the motivation to use it entirely.
Kinda. To the degree that the object of increase is also a percentage the statement “increasing X (where x is quantified as a pct) by Y %” could mean that X of 20% is increased to 70% or to 30%. It would be more clear to state “X increases from Y% to Z%.”
I understand why companies want to bury bad news under generic titles but that doesn't mean we have to play along. This is a case where "editorializing" the title seems helpful.
A rule of thumb: if it is really bad it will not be reported by the actual company doing it. It will be buried in the TOS and then discovered by angry users, and picked up by media.
It's a common problem when reporting on changes of some percentage value. I guess it's more dramatic to say "increased by 50%" rather than "increased by 0.5 points"
Common example headline: "Inflation up by 100%" when it went from 1% to 2%. The headline implies goods & services are now 2x more expensive than before, which is not the case.
I don't feel it's disingenuous at all. When I read the title I instantly understood it to mean multiplying the fee by 1.5. In what world would anyone take this to mean that they're charging 50% of each transaction?
I don't feel it's disingenuous at all? They're increasing the fee by 50%... of the fee, obviously. In what world would anyone take this to mean that they're charging 50% of each transaction?
Fees on payment methods are a good example of the kind of friction we wanted to get rid of, agreeing to use these intermediaries.
If we've just replaced stupid inter-bank 3 day cheque clearing bullshit fees with stupid microtransaction fees which are variable at-will by the guy in the middle, whats the point?
Money is regulated. Money flows should be regulated. This industry should be regulated, and the fees set to cost recovery, not profit point. If that reduces to one interchange agency per economy, I'd be fine: Nationalise them all.
Does it cost the CPU more to process $1b in one transaction than to process 10c?
That isn't the title of the page and a great illustration of why we should always speak in percentage points or real numbers. "Shark attacks increase by 300%" (from one to four) is a textbook example of a tabloid headline.
It's impossible to talk about real numbers in this case of course, and speaking strictly about percentage points or bips doesn't capture the thrust of the change (or situate it accurately vis a vis stripe's continual fee inflation, i.e. see elsewhere others' comments ~"stripe has been nickel and diming us for years"). In an era where stripe has used its cache to capture certain business communities wholesale and then ratcheted up pricing in ways you wouldn't expect outside of a monopoly player IMO, I think it's helpful to be super clear about the relative change rather than absolute change.
Readit News
This is mildly interesting, and maybe important for a few people. That's enough.
Dead Comment
I've met drivers who have had to pay out multiple times per day.
- Buy ads targeting your page selling stuff (for example a course) - Generate revenue - Instant payout - Repeat
In this flow you don't need to wait 1 month for a payout so you are not limited doing this once a month, you can do this for example 12 times a month therefore generating much more revenue.
Founder still lurks HN as well.
So you can use the balances from the people who added money 2 days ago, today.
The last time I created an invoice manually it tried to upsell me on a far more expensive plan just so I can group things on an invoice. Even worse, adding a recurring product to a quote results in an upsell.
It’s honestly embarrassing. Feature-gating things with 0 marginal cost feels desperate.
Does this portend anything for the company, in the way that not backfilling positions means that layoffs may be imminent? Or perhaps a corporate transaction like an IPO?
Instant payout is much riskier because if a bad actor is using Stripe to cash out stolen credit cards they have less time for the banks to detect and report it before the money is gone. As a result it has a higher cost to the company.
The reason credit card fraud for charges costs money to processors is because of charge backs. I believe charge back fees originate from the card networks themselves (Visa, MasterCard, etc). These processors also enforce a variety of limits when it comes to chargebacks for each merchant. This means if you're the layer between the merchant and the network, the merchants generally will rely on you to pre-emptively detect fraud. Those systems all cost money too.
As far as I know when it comes to payout rails such as ACH, real time payments (RTP), Zelle, I don't believe the payment processor holds any liability for fraudulent transactions. In other words, if a fraudulent payout occurs through stripe via RTP then The Clearing House banks aren't going to come after stripe for the money. They'll tell the end user "whoops, should've taken better care of your digital info. Bye!"
source: Worked at a payment processor and worked on payout rails and integrating with banks. Also do work now as an end user of a different payment processor that does charging, payouts, etc.
Services like Venmo and Cash App basically have no income stream without paid instant payouts.
Dead Comment
I have no "method" filter on that page, only "date", "amount" and "status". Also they talk about 2 business days payments as default but in the settings you can only choose between automatic every day / week / month.
Since the instant payout is kind of a loan and you have to request it, pretty sure it doesn't affect me but it's all very confusing.
Only costs ~$25/month to plug into these rails, plus a few cents per transaction.
https://www.frbservices.org/financial-services/fednow/organi...
https://www.frbservices.org/resources/fees/fednow-2024
https://www.frbservices.org/binaries/content/assets/crsocms/...
Stripe increasing "instant payout" fees from 1% to 1.5% on US
Current title:
Stripe increasing "instant payout" fees by 50%
"There has been a 1000% increase in traffic deaths this year, we must do something!"
Ah yes, we went from 1 death per year to 11 because there was a fatal bus accident, surely we need to do something.
> June 2024 pricing update for Instant Payouts for businesses in the United States
i dont care about anyone trying to say: huehehue thats how its written. no its not.
but yeh i guess ppl rather focus on shitposts and talk endlessly
Deleted Comment
Common example headline: "Inflation up by 100%" when it went from 1% to 2%. The headline implies goods & services are now 2x more expensive than before, which is not the case.
If we've just replaced stupid inter-bank 3 day cheque clearing bullshit fees with stupid microtransaction fees which are variable at-will by the guy in the middle, whats the point?
Money is regulated. Money flows should be regulated. This industry should be regulated, and the fees set to cost recovery, not profit point. If that reduces to one interchange agency per economy, I'd be fine: Nationalise them all.
Does it cost the CPU more to process $1b in one transaction than to process 10c?
Deleted Comment