Dumped by Stripe after 6 years and no disputes: Alternatives?

I've been growing StatusGator for more than 6 years and recently crossed $8,000 MRR. Until today, I had been very happy with Stripe. It truly is the fastest and most convenient way for developers to get going with payment processing. I have passionately advocated for Stripe at every start up I've consulted for. It really cannot be beat.

But after opening a new Stripe account for a new SaaS product I haven't yet launched, my account was closed unceremoniously. I am disillusioned and left with zero recourse after this confusing email:

Stripe is unable to support businesses with a dispute rate consistently above 1%. The elevated level of disputes on your account(s) has led us to hold a percentage of your incoming funds as a reserve. The reserved funds will help cover any disputes or refunds on your account.

This new account opened had not even started yet. I haven't even finished building the product. I have zero payments and therefore zero disputes. Surely, this was a mistake. I reached out to Stripe support. Their response was to close my account entirely:

After reviewing your business and account information, we've found that your business presents a higher level of risk than we're able to work with.

Now I'm stuck with two questions:

  • How do I get my new product off the ground if Stripe won't have me? Why would they even shut down my account if I haven't launched my new SaaS yet?
  • Why would I want to continue to keep StatusGator and it's $8,000 MRR at Stripe if they can close my account unceremoniously and robotically with zero information?

To be clear, Stripe closed an account I had just opened for a product I haven't even launched yet. The account has zero payments and zero disputes. My other account for my successful product has 6 years of history and not a single dispute ever.

What alternatives do I have? I'd like to a.) get my new product launched on a platform that will have me. And I'd also like to b.) move StatusGator off of Stripe. The risk of my rapidly growing business shutting down is just too great.

Does anyone have any experiencing navigating the robotic machinery that is Stripe's dark side? Has anyone successfully moved to an alternative that is as developer-friendly and easy to get going as Stripe?

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    As an aside, I absolutely hate how the larger companies do this now. It is obviously a machine automated process that hasn't been configured properly and resulted in a false positive.

    We had exactly the same thing happen to us with MailChimp. After nearly a decade of using them in one business, I set up a new sub-account for a new company, and was almost immediately shut down for 'suspicious activity' despite the only email addresses in there being 3 test ones sent from our new app via API.

    The worst part is the "our decision is final and no correspondence will be entered into". I find that to be abhorrent that they give absolutely no recourse to customers to defend themselves or put their side of the argument forward.

    In my own SaaS, we never automate anything like this, and any disputes are resolved human to human, so we can get a full understanding where possible. I intend to run my business that way, no matter how big we get.

  2. 8

    Paddle seems to be a good one

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      Thanks for recommendation. I'll try to use Paddle in my next project.

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    @csallen you know of any recent changes at stripe? This is the 2nd bad/weird story about stripe cannibalizing new companies this week...
    Reminds me of how PayPal changed over time

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    ha, yes welcome to the world of fintech businesses, operated by 12 year olds who don't have a clue how to deal with customers. Fair enough, they maybe made a mistake with you and mistakes do happen. But it's how they deal with it that counts. We like to hate traditional banks and finance businesses, but my word, we are in for a shock over the coming years when most of the things we rely on are controlled by people who think a support ticket and 10 day turnaround is the best way to handle their customers!

    My own fintech horror story...

    I have a Transferwise personal account and last year accidently put a couple of legitimate business payments through it. It turns out my business Clickacall (a WebRTC based b2b service) falls into the list of business they don't support, i.e. WebRTC.

    So with zero warning they closed my account and only provided an email address to fight it. The account had £400 in it - and believe me, I needed that money! Locked. Gone.

    It took 10 days before they responded to my begging emails and made me feel like a naughty toddler. I had to confirm I would never use it for business again "you very naughty boy" and then after a further few days they re-opened it.

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    There's probably not much human thought or attention to detail in the shutdown of your other account. That being the case, you could just open a new Stripe account and point to the same bank account and see if that works. I mean, why would we assume they could connect those dots if they can't connect the dots anywhere else?

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      That's a good point! Oddly comforting to think the robot's ineptitude might help me here.

      Some people here have mentioned Paddle which looks interesting. It appears they have some kind of "white glove" service for migration.

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    I know it's impractical. I know it's silly. But no-one else has said it so far.

    So: Bitcoin?

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      There's always one of you...

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        In a few years it will be the norm, perhaps not bitcoin but other coins. It solves the middleman problem and money goes straight to your account almost instantly, no chargebacks, no holding, no-one in the middle to close your account. Direct payment from customer-to-business.

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          Strongly disagree. Bitcoin, and thus every other "coin" is seen as an investment piece and not a currency. It'll be more than a few years, if ever, that it will be treated as a regular transactional currency.

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            That’s because there’s a lot of price volatility. Coins need to stabilise in price before being accepted as currency.

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    I use Paddle, had no big issues with them yet in about 6 months, pretty happy so far.

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    Why do you need a different new account? AFAIK payment collection for multiple products can be managed from single Stripe account.

    1. 1

      It's a good point. I probably could use the same account. But there's a few reasons not to:

      1. My partner and I have built numerous SaaS products (all on Stripe). One of them we sold very recently and selling them would have been significantly more difficult if its financial had been tangled up with that of our other products. For that reason alone, I think it's better not to mix.
      2. We are pretty obsessive about analytics and track all kinds of metrics about our customer lifetime value, growth rate, acquisition cost, churn rate, and on and one. Having multiple separate products mixed together in one account would make analysis very difficult. For example, we use ProfitWell's free analytics on all our products and use it to set goals and track our progress.
      3. Mixing products in a single account sounds like even more risk in situations like this. What if one product has a high chargeback rate and then suddenly causes a raise in reserve rates on the other? Seems riskier.
      1. 1

        Isn't you have to open a new company (llc/ptv ltd) for new Stripe account?

  9. 2

    We have always wanted to use Stripe for our ESP SaaS, but because they do not operate in our country, we were forced to look elsewhere.

    We ended up using Paddle. So far have been pretty satisfied, although the way their API works is not as robust and straightforward as Stripe. Our billing team has to implement a lot of workarounds to do what we wanted, when it was pretty straightforward with Stripe (judging on Stripe's API docs).

  10. 2

    And I'd also like to b.) move StatusGator off of Stripe.

    I'm not sure any other platform will be less arbitrary.

    It's the platform risk we assume by using these turn-key payment processors.

    This is also my biggest fear -- to get shut down for no reason whatsoever despite having 0 disputes.

    It's one thing to lose fair and square in the free market; it's another to be sabotaged by a supplier for no good/defensible reason whatsoever.

    But other than "just build your own payment proceesor, bro," I don't know of any good solution to this problem.

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      This is a good point. Other platforms probably are just as arbitrary. It's the seemingly automated nature of it like @Devan said that is the most infuriating part of the situation.

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    Have you tried their live chat? I’ve always found their support via live chat to be fantastic. At the very least someone needs to explain the rationale to you

  12. 1

    That must be frustrating for you. Have you contacted customer service about it? I have only used Stripe for cc processing but I recently found out that Paysafe seems to have similar features. https://developer.paysafe.com/

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    What alternatives do I have?

    Paypal is still a good alternative. I know many of us hate it but we get emails from users asking if they can pay via PP. So we had to add it back as backup. Also you can get started almost instantly on that.

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      Paypal has treated me and my customer horribly. I would never recommend it to anyone. Support will take you through an insane loop that will ultimately yield nothing. AVOID unless you love hell.

      I am honestly shocked stripe is allegedly behaving in a similar way. I've always had an easy time with stripe but if they treat you badly OP, LEAVE.

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        Yeah PayPal is horrible to work with

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          And develop with,

          Here is a Content Security Policy issue open for over a year, marked as 'medium-priority' !

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