So a bit of background. I started a small startup in the infoservices space back in June of 2018. I ran some ads, had a big launch, and Stripe suddenly decided to hold all funds due to perceived risk. This was after I paid about $10k in Google AdWords alone, plus countless other startup costs related to the launch, so I had to eat those costs.
So Stripe emails me saying it'll hold all funds for 90 days against the risk of disputes. Cool. I wait 90 days patiently for my funds to be sent to me. What happens in 90 days? I get another, generic, boilerplate email saying that Stripe is holding my money for 90 days. No, this was not phrased as an extension. It was simply a duplicate of the earlier email. I go in the panel, and the date is indeed pushed back 90 days.
Cool. So I wait another 90 days, again, patiently, for my money. At the end of the (now second) 90 day period, I contact Stripe, and great, I get an email saying my reserve has been reviewed and is now lifted! I check my account, and indeed the reserve is lifted. I patiently wait for my funds to arrive.
But wait, it doesn't end there! Three days later, instead of receiving any sort of payout, I get an email saying "we need to extend your reserve for another 30 days due to the elevated dispute risk here. if we perceive there to be less dispute risk at the end of this period, we will release the funds." This brings the total hold to 210 days. And notice how they aren't even guaranteeing the funds after 30 days -- they're only going to release them if they PERCEIVE a lessened dispute risk, which is totally subjective.
Don't believe me? Go to Stripe's BBB page. It's literally filled with hundreds of complaints of arbitrary fund holds that last for indefinite periods of time. Even PayPal (yes, even PayPal) caps their holds at 180 days. This is because the maximum timeframe a customer can dispute in is 180 days. So Stripe is holding my money against "elevated dispute risk," when customers can't dispute anymore even if they wanted to.
On top of this, Stripe recently asked me to provide them with my driver's license, bank statement, and then refused to review any of them in a timely matter. These still aren't reviewed to this day. So not only does Stripe use the "elevated dispute risk" excuse to steal your funds (even when no dispute risk exists), it also hides behind federal regulations like KYC (know your customer) and the Patriot Act as a justification for requesting more documents, bogging you down in red tape, and hoping you'll go away so they can keep your money.
I submitted a BBB complaint, and the Stripe response merely quoted a paragraph in their Service Agreement that allows for funds to be held for ANY REASON and ANY DURATION OF TIME. That's right. Stripe can hold your funds FOREVER, FOR ANY REASON. And get this: the funds you process on Stripe aren't even LEGALLY YOURS. Stripe owns the rights to ALL of these funds, and only releases them at their sole discretion.
Run away from Stripe, and run away fast. I love their API like the rest of you here, but their customer support is AWFUL. They put so much emphasis on their "fraud detection systems and models" that they completely de-prioritize human customer support. Every time I emailed in a response (in the same email thread), I received a NEW Stripe representative, who had no idea what had just gone on previously. And the whole extraordinary encounter with the customer service representative who lifted the hold -- only to later be counteracted by another customer service representative absolutely at random, with no trigger whatsoever, is just laughable and extremely telling. There is not only communication breakdown across departments at Stripe, but WITHIN THE SAME DEPARTMENT AND EVEN THE SAME JOB FUNCTION.
Using Stripe is like willfully subjecting yourself to the Sword of Damocles conundrum. If their automated system THINKS you're POTENTIALLY a risk based on hundreds of data points (and by the way, these bots are constantly evaluating your account in real time), you'll be shown the door. And to make things worse, if the bots think you're a risk and shut off your account, there's a chance that Stripe will add you to a Terminated Merchant File just for closing your account, in which case you'll never be able to process payments ever again, anywhere.
Apply to a direct merchant account and use Authorize.net as a gateway. Next day payouts into your business bank account, no hassle, no arbitrary fund holds, and actual humans you can speak to over the phone that can transfer you to people with the authority to act on your account and your concerns.
As for Stripe, I have virtually no hope in recovering the $31,829.65 they still owe me. They have collected thousands in fees on money that was never even disbursed to me. They will keep their processing fees, plus the entirety of the processed amount. The best I can do will be to pursue binding arbitration or sue, and bring this to the attention of regulators. Fortunately I work with Office of the Comptroller of the Currency regulators in my day job working as a financial technology consultant for a large US bank, so I will be sending this whole fiasco to their direct emails and following up over phone calls once the holidays are over.
Please, please do not use Stripe. Let this be a warning to all of you.