What Is Stripe, and How Does It Work to Accept Payments?
Stripe is a payment service provider that accepts credit cards, digital wallets and many other payment methods.
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Stripe is a global payments company built for large and small businesses alike. Its payment processing solution, Stripe Payments, is best for online sales. You can use Stripe Terminal to accept in-person payments. But it may require developer experience.
Stripe appears frequently on our list of top payment processing companies. We recommend it for online retailers, software-as-a-service solutions and service-based businesses.
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What payments does Stripe take?
U.S. businesses can take almost any type of payment with Stripe. It accepts major debit and credit cards, mobile wallets and ACH transfers. Stripe facilitates buy now, pay later options, online invoicing and recurring billing too. You can embed these checkout options on your existing website. Or, you can send unique payment links to customers.
The most notable exception is PayPal and PayPal products, like Venmo. Those are only available to Stripe merchants in some European countries.
Stripe also supports more than 135 currencies. That's far more than some of its competitors. And it's especially useful if your business sells internationally.
Still undecided on Stripe?
Explore some popular all-in-one payment processing and POS system alternatives.
Payment processing fees 2.6% + 15¢in-person; 3.3% + 30¢ online. | Payment processing fees 2.6% + 10¢in-person; 2.9% + 30¢ online (Basic plan). |
Monthly fee $0and up. | Monthly fee $39and up for e-commerce plans with POS Lite; Can upgrade to POS Pro for an extra $89. |
PayPal: Best for payment flexibility. One of PayPal’s strengths is its brand recognition among businesses and consumers. You can use it to accept payment methods that consumers are familiar with, like PayPal and Venmo. And, of course, it also lets you accept typical card payments. Read our Stripe vs. PayPal comparison.
Square: Best for brick-and-mortar businesses. Square has solutions for restaurants, cafes, retail shops and service-based businesses. It has inexpensive hardware options, and its free POS software is easy to use. Read our Stripe vs. Square comparison.
Shopify: Best for online storefronts. Shopify’s website templates make it easy to set up a professional online storefront. Its plans can be expensive. But processing rates do decrease as you scale up. Read our Stripe vs. Shopify comparison.
» MORE: Best Stripe competitors
How does Stripe payment processing work?
Like other processors, Stripe processes payments in six main steps.
- The customer provides their card information, either online or in person.
- Those card details enter Stripe’s payment gateway, which encrypts the data.
- Stripe sends that data to the acquiring bank. It will process the transaction on the merchant’s behalf. In this step, Stripe serves as the merchant (with the business owner as a sub-merchant). This means Stripe users don’t have to set up a merchant account, which can be cumbersome.
- The payment passes through a credit card network, like Visa or Mastercard. From there it goes to the cardholder’s issuing bank.
- The issuing bank approves or denies the transaction.
- That signal travels from the issuing bank through the card network to the acquirer. Then it goes through the gateway to the customer. They see a message telling them the payment either went through or didn't.
You can transfer funds from Stripe to your business bank account. Direct deposits typically take two business days. Instant payouts are available for an extra 1.5% of the transaction amount.
How to accept payments using Stripe
You can start accepting payments with Stripe almost instantaneously. Expect to complete these three steps first:
- Create a Stripe account. You can do this with just your name and email address.
- Provide business details. This will include the address and legal structure. Stripe will also request personal information about you. This will likely be your full name and date of birth.
- Link a bank account. This is where you’ll receive payouts from Stripe.
You won’t be able to collect payouts immediately, however. You generally can’t receive your first payout until seven days after you’ve taken your first payment. In some industries, the waiting period can be as long as 14 days.
After the signup process, you’ll also want to think about how you’d like to set up your customers’ checkout options. For example, you can embed a checkout module on your existing website. Or you can customize your own checkout flow. Other options include invoices, recurring billing and payment links.
How much does Stripe cost?
There are no monthly subscription fees associated with basic Stripe Payments capabilities. Most Stripe fees come from payment processing. And they differ depending on the transaction type.
Here are Stripe's transaction fees:
- 2.7% plus 5 cents for in-person transactions.
- 2.9% plus 30 cents for online transactions.
- 3.4% plus 30 cents for manually keyed transactions.
- 4.4% plus 30 cents for international card transactions.
Outside of payment processing, Stripe offers some optional services, like automated tax calculation ($90 per month and up) and custom domains ($10 per month). These do come with their own fees. Subscription payments also cost extra. Stripe charges either $620 per month or an additional 0.7% of your billing volume.
Is Stripe a safe way to pay?
Stripe has a PCI compliance Level 1 certification. That means it undergoes an annual compliance report and routine security scans. Stripe encrypts all customers’ credit card numbers. And it stores decryption information separately. In other words, it can’t see credit card numbers without taking extra steps. All online transactions also need to happen over the more secure HTTPS network.
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Methodology
NerdWallet independently reviews payment processing companies before determining our top picks. We collect the data for our software ratings from products’ public-facing websites and from company representatives. Our editorial team reviews information on a regular basis for consistency and accuracy.
We also periodically update our scoring system to reflect changing industry norms and business needs. For instance, in 2026, we dropped the “free trials” category from our rubric. Payment processing systems can be time-consuming to set up. Testing out multiple products isn’t an ideal approach. Instead, we recommend taking cost and features into consideration.
NerdWallet’s ratings of payment processing providers rewards companies whose products and services are priced well and work in a variety of payment scenarios, among other criteria.
Ratings are based on weighted averages of scores in several categories, including overall cost, hardware and software options, system capabilities, customer service, contract requirements and integrations. Learn more about how we rate payment processing providers.
These ratings are a guide, but fees, hardware, software and contract requirements can vary widely from business to business and provider to provider. We encourage you to shop around and compare several providers.
NerdWallet does not receive compensation for any reviews. Read our editorial guidelines.
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Best Payment Processing Companies
| Product | Payment processing fees | Monthly fee | |
|---|---|---|---|
 Square Nerdwallet Rating on Square's website | 2.6% + 15¢ in-person; 3.3% + 30¢ online. | $0 for Free plan; $49 Plus plan; $149 Premium plan. | on Square's website |
 Helcim Nerdwallet Rating on Helcim's website | 0.40% + 8¢ plus interchange, in-person; 0.50% + 25¢ plus interchange, online. | $0 | on Helcim's website |
 Stripe Payments Nerdwallet Rating on Stripe's website | 2.7% + 5¢ in-person; 2.9% + 30¢ online. | $0 | on Stripe's website |
 Shopify POS Nerdwallet Rating on Shopify's website | 2.6% + 10¢ in-person; 2.9% + 30¢ online (Basic plan). | $39 and up for e-commerce plans with POS Lite; Can upgrade to POS Pro for an extra $89. | on Shopify's website |
