Stripe increasing "instant payout" fees by 50%

[tananaev]

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.

[notatoad]

I don't think the bar for appearing on the front page of HN is "important news"

This is mildly interesting, and maybe important for a few people. That's enough.

[ec109685]

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.

[figassis]

In some industries, for example where tipping is important, getting payouts at or almost at the speed of sales is often a differentiating factor.

[DANmode]

Ask your Uber driver on a Thursday!

I've met drivers who have had to pay out multiple times per day.

[iJohnDoe]

Genuine question. In what way free? Stripe still takes their fees? Or is there a way to avoid fees when sending an invoice to a client?

[jefozabuss]

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.

[xyst]

I think stripe was a YC funded company at some point. Algos on hn pump them hard.

Founder still lurks HN as well.

[BillyTheKing]

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

[encoderer]

Stripe will nickel and dime you to death.

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.

[abnercoimbre]

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?

[mysore]

welcome to every business in america.

[gnicholas]

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?

[mike_d]

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.

[neurostimulant]

I imagine it's due to the increasing number of card-testing attacks which cost them money, increasing risk for instant payout.

[lazyant]

> 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.

[tjbiddle]

They likely meant the ACH is 2 business days.

[pentagrama]

A more honest title to me:

Stripe increasing "instant payout" fees from 1% to 1.5% on US

Current title:

Stripe increasing "instant payout" fees by 50%

[epgui]

The current title is fine. It’s a 50% increase (unambiguously), or a 0.5 percentage point increase (also unambiguously).

[wglb]

The title should be what the article says. We are not to editorialize or rewrite titles.

> June 2024 pricing update for Instant Payouts for businesses in the United States

[0wez]

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

[VoidWhisperer]

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.

[cplat]

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.

[csomar]

I think people who know/use Stripe will have no confusion about this.

[colecut]

That is what a 50% increase means.

[SoftTalker]

Yes, it's editorialized. The actual title is "June 2024 pricing update for Instant Payouts for businesses in the United States"

[qntty]

Percent vs percentage points. It's slightly confusing but the title is correct.

[paulpauper]

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.

[beAbU]

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.

[m3kw9]

Choose between “now 1.5%” or “50% increase”

[dataflow]

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?

[dataflow]

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?

[ggm]

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?

[amadeuspagel]

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.

[cemerick]

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.

[gjsman-1000]

If I remember correctly, payouts always take two or three days to clear, to comply with all of the settlement and legal processes.

The “instant payout” is actually a temporary loan from an entity already approved as having all funds available for immediate disposal at multiple links in the chain. This is then used to create the illusion of an instant payout… while the “loan” guarantor receives payment 2-3 days later.

This is also why there’s actually a “instant payout” limit on your Stripe account, almost like a credit limit - because it basically is credit.

[lxgr]

> payouts always take two or three days to clear, to comply with all of the settlement and legal processes

No, that's usually just how long ACH transfers can take. In most cases, it's more like next-day these days, in my experience (e.g. from paying out from PayPal to my checking account or between checking accounts), but that depends on the specific ACH type and timeline, I believe.

> The “instant payout” is actually a temporary loan

It's usually not. Actual settlement of both card and ACH payments usually happen on the next business day, but since that goes for both legs of most transactions, the settlement periods "cancel each other out".

[twelvechairs]

Yes as noted on the page

> You can always pay out your funds using our standard schedule (2 business days) for free.

[contingencies]

Sounds like a blockchain startup in the making!

[Animats]

1.5% for a 2 day loan is an APR of what? More than 270%.

[naniwaduni]

When you're competing with payday loans, it makes sense to price the product similarly...

[qmarchi]

Anyone have a list of providers that use Stripe Connect?

[joshstrange]

I’m confused by your question. They mention Connect in the FAQ but this only applies to instant payouts, honestly it seems more confusing that they mention Connect at all in this context. What are you getting at or trying to figure out with your question?

I’m interested because my business used Stripe Connect but this change seems to have zero change for me. If businesses want instant payouts they can decide that on their own and if they want to eat the fee, it doesn’t matter to me.

[danpalmer]

There are going to be thousands. I've seen several small businesses in niche areas that happen to use Stripe Connect to offload all of the payments to a company's existing Stripe account.

All companies taking funds via Stripe Connect will know they are doing so via Stripe, so I don't think a list of Connect providers would help here.

[teddyX]

Payday loans are cheaper

[wnc3141]

In other news, the cost of no ey has increased several hundred percent since 2019.

[southernplaces7]

Yawn. In some countries at least, (mine for example) Paypal does the same. If I get a payment (and let me add that I detest paypal but, such are the choices of some employers), I can wait 24 to 48 hours for my money, or I can get it instantly at any time Monday to Friday between 6:15 am and 10 pm, but at an additional cost of roughly 3 dollars. Bear in mind that this is on top of their atrocious, thieving obligatory exchange rates and any other fees they tack onto payments sent to you.

Of course I'm nearly certain that sending me that money instantly costs Paypal nothing, but enshittification creeps into all things, sort of like the dust created by dead skin and human trash. It permeates. Though in Paypal's case, shitty service has been a byword for decades already.

Edit: when occasionally receiving payments in crypto on the other hand, I get charged minimal fees, can convert to my local currency at essentially market exchange rate, and can have the money transferred to my actual bank account at any time 24/7 for free. Yes yes, HN hates crypto and blah blah, but outside the bubble, there are people who find these things useful.