One of the world’s leading online payment processing platforms, Stripe, has recently announced a major update to their fee structure which will come into effect from 10th April 2023.
The change, which includes increases to the fees for both card processing and disputes, is set to impact businesses of all sizes across the UK (and beyond) and will likely have a significant impact on their bottom lines.
What are the new Stripe fees?
Under the current structure, the Stripe fees range from 1.4% + 20p to 2.5% + 20p per transaction for UK/European cards and 2.9% + 20p per transaction for non-European cards.
However, the new fees will be as follows:
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- Standard UK cards (most cards including American Express) – 1.5% + £0.20
- Premium UK cards (commercial Visa/Mastercard) – 1.9% + £0.20
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- International cards issued outside the UK and Europe – 3.25% + £0.20
How will the new Stripe fees impact businesses?
For businesses that process a high volume of online transactions, the new fees are likely to have a significant impact on their profitability. Small businesses operating in the UK, in particular, are almost guaranteed to feel the pinch with the fees for standard UK cards increasing by 7%.
However, if they’re taking payments using ‘Premium Cards’ they may be hit even harder, with the change in fees for premium cards increasing by a huge 35%.
It’s not much better for businesses that operate internationally and process transactions from cards issued outside of the UK and Europe either, as they can expect to see their fees increase by 12%.
For businesses that process relatively small transactions, the 20p fixed fee means that the percentage increase in fees will be even higher. For example, a business that currently pays 1.4% + 20p per transaction may see their fees increase by 36% to 1.9% + 20p per transaction.
That means for a transaction worth £10, the fee will increase from 34p to 39p – a 15% increase in the total fee! With a transaction for £100, the fee will increase from £1.60 (1.6%) to £2.10 (2.1%) which is an increase of 31.25%. Even worse for a £1,000 transaction, the fees increase from £14.20 to £19.20 a whopping increase of over 35%!
What can businesses do to mitigate the impact of the new fees?
Stripe themselves know that this increase isn’t going to be viable for many businesses. They’ve even included some ‘lower cost payment alternatives’ in their fee increase announcement.
One of those alternatives is bank transfers, which they charge 0.5% per transaction for. Here at TrustistTransfer, we have created an even more cost-effective alternative to bank transfers that provides even more security, a streamlined process and peace of mind for business owners with fees as little as 0.29% per transaction.
That means, by moving from Stripe to TrustistTransfer, your fees could potentially be reduced by as much as 88%. So, if you pay £1,000 a year to Stripe, this could come down to around £120, saving you £880 – enough for a holiday!
Get started with your TrustistTransfer account and start saving more of your money – https://trustist.org/TrustistTransferSignUpNow
FAQs
The new fees for Stripe as of 10th April 2023 are: Standard UK cards (most cards including American Express) – 1.5% + £0.20, Premium UK cards (commercial Visa/Mastercard) – 1.9% + £0.20, and International cards issued outside the UK and Europe – 3.25% + £0.20.
The new fees are likely to have a significant impact on the profitability of businesses that process a high volume of online transactions, particularly small businesses in the UK. Fees for standard UK cards will increase by 7%, while fees for premium cards will increase by 35%. Businesses operating internationally can expect to see their fees increase by 12%.
Businesses can consider using lower-cost payment alternatives such as bank transfers or TrustistTransfer, which offers fees as low as 0.29% per transaction. By switching to TrustistTransfer, businesses could potentially reduce their fees by up to 88%.
If a business currently pays £1,000 a year to Stripe, they could potentially save around £880 by switching to TrustistTransfer. This is enough to cover the cost of a holiday. TrustistTransfer provides a cost-effective alternative to bank transfers that offers more security, a streamlined process, and peace of mind for business owners.
