Payments platform Stripe is relaunching its Stripe Connect service, a set of tools for managing more-complicated-than-usual scenarios that involve accepting credit and debit cards — such as making sure on-demand economy workers and crowdfunding campaigns get paid, the company announced on Monday (March 23).
Unlike conventional businesses that only need to accept payment from customers, multi-sided marketplaces also have to track lots of information about multiple sellers, including verifying seller identity to comply with Know Your Customer laws and prevent fraud, collecting and verifying seller bank information, and handling local tax reporting requirements, along with making sure sellers get paid, said Stripe product engineer Brian Krausz in a blog post announcing the new Connect version.
If those sound like requirements you’d associate with businesses expanding internationally, that seems to be the point. Stripe customers Lyft and Instacart have both just closed big funding rounds and are looking hard at international expansion, with all the complications those will entail. A payments platform that handled those issues would be just what’s needed to keep those customers as customers, according to VentureBeat.
In practice, that’s why these new tools were developed. They’re just being rebranded and offered to the rest of Stripe’s customers. Stripe currently offers cross-border support for 17 countries outside the U.S., including Canada, Australia, the U.K., France, Germany, Belgium, the Netherlands, Ireland, Spain, Italy, Austria, Denmark, Finland, Norway, Sweden, Luxembourg and Switzerland. Support for additional countries is on the way.
Of course, the tool set will also work for on-demand economy companies that aren’t expanding across borders, serving as a cross between a payroll company and the equivalent of a Human Resources department for these non-employees. The new features may also come in handy for crowdfunding businesses like Kickstarter, which dumped Amazon Payments in favor of Stripe in January.
An additional Stripe Connect feature called “managed accounts” allows on-demand companies to highly customize the user interface for sellers through a set of APIs. Managed accounts cost an additional 0.5 percent of the funds paid out, which includes ID verification, helping to generate tax documents, and international account support. All the other Stripe Connect functionality is free except for Stripe’s standard charges for accepting payments.