A Guide to Types of Payment Methods | Stripe (2024)

Stripe logo
  • Payments Payments Online payments
    • Payment Links No-code payments
    • Checkout Prebuilt payment form
    • Elements Flexible UI components
  • Terminal Terminal In-person payments
  • Radar Radar Fraud prevention
  • Authorization Authorization Acceptance optimizations
  • Connect Connect Payments for platforms
  • Treasury Treasury Financial accounts
  • Capital Capital Customer financing
  • Issuing Issuing Physical and virtual cards
  • Billing Billing Subscriptions and usage-based
  • Revenue Recognition Revenue Recognition Accounting automation
  • Invoicing Invoicing Online invoices
  • Sigma Sigma Custom reports
  • Data Pipeline Data warehouse sync
    • Payment methods Access to 100+ globally
    • Link Accelerated checkout
    • Financial Connections Linked financial account data
    • Identity Online identity verification
    • Atlas Startup incorporation
  • Enterprises
  • Startups
  • Ecommerce
  • SaaS
  • Platforms
  • Marketplaces
  • Finance automation
  • Embedded finance
  • Global businesses
  • Crypto
  • Creator economy
  • Stripe App Marketplace
  • Partners
  • Professional services
  • Documentation
  • Prebuilt checkout
  • Libraries and SDKs
  • App integrations
  • Accept online payments
  • Manage subscriptions
  • Send payments
  • Full API reference
  • API status
  • API changelog
  • Build on Stripe Apps
  • Support center
  • Support plans
  • Guides
  • Customer stories
  • Blog
  • Sessions
  • Contact sales
  • Jobs
  • Newsroom
  • Stripe Press
  • Become a partner

A complete guide that lists the different types of payment methods available to help you understand and select the right payment options for your business.

Payments

Accept payments online, in person, and around the world with a payments solution built for any business—from scaling startups to global enterprises.

Learn more
  1. Introduction
  2. 1. The benefits of payment methods
  3. 2. Choosing the right payment methods for your business
    1. 2.1. For ecommerce and marketplaces
    2. 2.2. For on-demand services
    3. 2.3. For SaaS and subscription businesses
    4. 2.4. For professional services
  4. 3. How Stripe can help
  5. 4. More about payment methods
  6. Get started with Stripe

As online tools make it easier to connect with global customers, more and more businesses are selling overseas. In fact, aStripe studyfound that 70% of online businesses are selling internationally today. While it’s easier than ever to reach a global audience, online businesses are also faced with a new challenge: How do you address the diverse customer preferences of a global audience during the checkout experience? The way customers prefer to pay for goods or services online varies drastically based on where they are located. If you don’t create a relevant, familiar payment experience, you could cut off entire countries from your addressable market.

While the global payments landscape has become increasingly complex and fragmented, Stripe makes it easy for any type of business anywhere in the world to discover and accept popular payment methods with a single integration.

This guide helps youevaluate and identify the payment methods that are well-suited to your business model and customer preferences and offers an in-depth look at thepayment methods Stripe supports.

1. The benefits of payment methods

Over the past decade, payment methods have evolved to support different consumer and business needs. Markets with high card penetration, such as the US and the UK, have seen a significant shift toward wallets like Apple Pay and Google Pay, which offer more security and convenience. Some markets, such as France and Japan, even have their own local card networks that help businesses reach more card users. In markets like Germany and Malaysia, where card use is much lower, bank-based methods are strongly preferred and trusted for online purchases. The banking networks in these markets typically offer a faster and more secure checkout experience where users can authorize a payment using their online banking credentials. Meanwhile, in economies with a large unbanked population, such as Mexico and Indonesia, popular payment methods allow customers to pay for online goods with cash using vouchers.

A Guide to Types of Payment Methods | Stripe (1)

By accepting payment methods that are both preferred by your customers and relevant for your business model, you can:

  • Reach more customers globally:As you expand into new regions, accepting local payment methods may be necessary to capture the total market opportunity. For example, 54% of online transactions in China involve wallets such as Alipay or WeChat Pay, and 20% use the local card network China UnionPay. Without supporting these payment methods, you may risk missing out on the substantial and growing buying power of Chinese consumers.

  • Increase conversion:Up to 9% of shoppersabandon their cart if their preferred payment option isn’t available. Surfacing the right mix of payment options to customers can meaningfully increase the chances that they’ll successfully complete a purchase.

  • Reduce fraud and disputes:Anticipate and manage the risks associated with accepting online payments by choosing payment methods that match your risk preferences. As a general rule, the better the level of customer authentication, the lower the likelihood of fraudulent and disputed payments.

  • Optimize your transaction costs:Payment methods have inherently different cost structures. Depending on your business model and where your customers are located, certain payment methods may or may not be relevant.

2. Choosing the right payment methods for your business

Whether you want to improve conversion in your domestic market or expand globally, surfacing relevant payment methods to your customers is key. But, depending on the nature of your transactions and where your customers are located, certain payment methods may or may not be relevant.

This section covers the eight major payment method families and specific considerations based on your business model: ecommerce and marketplaces, on-demand services, SaaS and subscription businesses, or professional services. If you are a B2B platform that enables your users to accept payments, your relevant payment methods depend on the business model of your users (for example, if your users have a SaaS business model, refer to section 2.3 below on SaaS and subscription businesses).

Description

Supports recurring payments

Supports refunds

Supports disputes

Payment confirmation

Cards

Cards are linked to a debit or credit account at a bank. To complete a payment online, customers enter their card information at checkout. Yes Yes Yes, highest dispute rate Immediate

Wallets

Wallets are linked to a card or bank account, but can also store monetary value. Wallets typically require customer verification (e.g., biometrics, SMS, passcode) to complete a payment. Yes Yes Yes, lower dispute rate than cards Immediate

Bank debits

Bank debits pull funds directly from your customer’s bank account. Customers provide their bank account information and typically agree to a mandate for you to debit their account. Yes Yes Yes, lowest dispute rate Delayed

Bank redirects

Bank redirects add a layer of verification to complete a bank debit payment. Instead of entering their bank account information, customers are redirected to provide their online banking credentials to authorize the payment. No, but Stripe supports recurring for some methods by converting to direct debit Yes No Immediate

Bank transfers

Credit transfers allow customers to push funds from their bank account to yours. You provide customers with the bank account information they should send funds to. No Yes No Delayed

Buy now, pay later

Buy now, pay later is a growing category of payment methods that offers customers immediate financing for online payments, typically repaid in fixed installments over time. No Yes Yes, most methods will take on fraud risk Immediate

Cash-based vouchers

With cash-based vouchers, customers receive a scannable voucher with a transaction reference number that they can then bring to an ATM, bank, convenience store, or supermarket to complete the payment in cash. No No No Delayed

Real-time payments

Enable your customers to pay almost instantly, 24/7 directly from their bank accounts, wallets, or other funding source, which helps increase speed and conversion—all at a low cost to your business. No Yes No Immediate

2.1. For ecommerce and marketplaces

Recommended:Cards; wallets; bank redirects; buy now, pay later; real-time payments

While frictionless checkout experiences are vital for any business model, its importance is magnified for ecommerce and marketplaces. Customers expect streamlined payment experiences—ones that give them what they want, when they want it. The right set of payment methods not only offers payment flexibility and convenience to maximize conversion but also reduces fraud and increases transaction speed.

Cards are the most commonly used payment method, and it’s important that you support all relevant card brands to optimize conversion and costs. Wallets and bank redirects can also help increase conversion by allowing customers to use stored payment information (the added verification also lowers the possibility of disputes). Wallets, like cards, are a reusable payment method—customers provide their payment details once, and if that information is stored, they don’t need to share any additional information for future payments. This enables you to offer one-click checkout experiences. Real-time payments enable customers to pay almost instantly from their bank accounts, wallets, or other funding sources, which help increase speed and conversion at a low cost. If you sell high-value goods, consider buy now, pay later payment options, which allow your customers to customize their payment terms and break up purchases into smaller installments.

In many large markets with low card use, such as Brazil, Mexico, and Indonesia, customers prefer to pay with cash-based vouchers and bank transfers, which don’t support immediate payment confirmation or native refunds. This can create challenges for ecommerce businesses that typically rely on real-time payment notifications to manage their shipping flows or refunds to promote customer loyalty. Stripe can help global businesses cater to these customers by enabling automated refund experiences and faster notifications for payment types that don’t typically support these features.

2.2. For on-demand services

Recommended:Cards, wallets, real-time payments

With instant fulfillment at the heart of the customer experience, on-demand services need to encourage conversion—often on mobile—while managing fraud risk. Consider focusing on payment methods that offer immediate confirmation that the transaction was successful, such as cards, wallets, and real-time payments. These payment options also allow you to store customer payment details on file and enable one-tap confirmations, shortening the checkout experience. While wallets typically have the same transaction cost as cards, they are more secure since authentication is required to complete payment, lowering fraud and dispute rates.

It’s still important to consider the local context, as payment methods with more friction may be trusted and preferred to pay for on-demand services or add top-ups to customers’ app balance.

2.3. For SaaS and subscription businesses

Recommended:Cards, wallets, bank debits

If you manage recurring revenue and want to optimize your checkout experience for ongoing transactions, it’s important to consider whether or not payment details can be stored on file and reused. The ability to reuse a customer’s payment credentials allows you to initiate payments on a custom schedule, without requiring any action by your customers. Cards, wallet, and bank debit payments are all reusable—customers only need to provide their card number or bank account details once. And, for customers who prefer to use bank redirects such as iDEAL or Bancontact, Stripe makes it possible to use these methods for recurring payments by converting them into direct debits.

In addition, many SaaS and subscription companies face involuntary churn issues, where customers intend to pay for a product but their payment attempt fails due to expired cards, insufficient funds, or outdated card details. In fact, 9% of subscription invoices fail on the first charge attempt due to involuntary churn.Stripe Billingcan help manage recurring declines for cards, in addition to supporting many of the most relevant payment methods for increasing recurring payment conversion (for example, because bank account information doesn’t expire, accepting bank debits can increase retention).

While accepting reusable payment methods is beneficial to the business, it’s also important to consider local expectations regarding recurring billing. For example, in markets like Brazil and Indonesia, it’s common to send recurring invoices or reminders for customers to initiate each payment. (Stripe Billingmakes it easy to accommodate both recurring charges and invoicing.)

2.4. For professional services

Recommended:Cards, bank debits, bank transfers, real-time payments

If you offer professional services or wholesale products, even a single payment failure or dispute could result in significant revenue loss. The ability to securely and successfully accept large payments can protect your business and can be solved, in part, by invoicing your customers so they have more flexibility to initiate payment when funds are available. Historically this has often meant asking customers to send checks. You can also send ahosted invoicewith built-in support for cards and bank methods to minimize payment failure and automate payment tracking and reconciliation. Real-time payment methods that allow customers to pay almost instantly from their bank accounts, wallets, or other funding sources are another increasingly popular option in Asia and Latin America. They have a low risk of fraud and disputes, as they require customer authentication.

In addition, bank transfers are a secure, nondisputable payment option that is often preferred for very large payments. Credit transfer funds are deposited directly into your account once the payment has been confirmed. Credit transfers also require your customers to initiate the payment, adding an extra level of authentication and security. And, because contracts are typically in place before payment, it’s less important that your business initiates the payment and more important that payments don’t fail and can’t be disputed. While tracking and reconciliation for credit transfers can be difficult, Stripe generates virtual bank account numbers to keep your company’s banking details private and automatically reconcile incoming payments with outstanding invoices.

A Guide to Types of Payment Methods | Stripe (2)

3. How Stripe can help

Companies of all sizes and from around the world use Stripe to accept multiple payment methods and simplify global operations. Stripe is actively adding new payment methods with the goal of enabling businesses to accept any payment method in the world with a single integration. Stripe offers:

Seamless integration options for all business models:The entire Stripe product suite comes with built-in global payment support, so you can create localized payment experiences regardless of your business model. Stripe’sPayments APImakes it easy to support multiple payment methods through a single integration. This leaves you with a unified and elegant integration that involves minimal development time and remains easy to maintain, regardless of which payment methods you choose to implement.

Supporting a localized and compliant payments experience for global customers is even easier withStripe’s Optimized Checkout Suite, which includes prebuilt UIs Checkout, Elements, and Payment Links. With the Optimized Checkout Suite, you can turn on popular payment methods from the Stripe Dashboard and then use Stripe’s machine learning algorithm to dynamically show customers the most relevant ones you’ve enabled based on transaction amount, browser, currency, and other signals. All prebuilt payment UIs are also able to trigger3D Secureand can handleEuropean SCA requirementsby dynamically applying card authentication when required by the cardholder’s bank.

Recurring revenue businesses can useStripe Billingto manage subscription logic and invoices and give customers the ability to pay their invoices with bank debits or other preferred payment methods. Platforms and marketplaces can useStripe Connectto accept money and pay out to third parties. Your sellers or service providers benefit from the same streamlined Stripe onboarding and get instant access to select payment methods.

Simple payment method setup:Stripe allows you to quickly add and scale global payment method support without filling out multiple forms with the same information or following one-off onboarding processes. You can also enable certain international payment methods without having to set up a local entity, bank account, or Stripe account.

No-code payment method testing and management: Experiment with new payment methods by running an A/B test to understand impact and set custom rules—all while offloading maintenance and eligibility requirements to Stripe right from the Stripe Dashboard.

Expanded payment method capabilities:Stripe can fill in certain gaps in payment method capabilities and expand their supported use cases. For example, bank redirects such as iDEAL or Bancontact don’t normally support recurring payments. However, Stripe converts these payment methods into direct debits so customers can use them to pay for subscription services.

Unified monitoring and reporting:Payments made with any payment method appear in the Stripe Dashboard, reducing operational complexity and allowing for lightweight financial reconciliation. This enables you to develop standardized processes for typical operations such as fulfillment, customer support, and refunds. And, because Stripe abstracts away the complexity of dealing with each payment method provider, you also benefit from one single point of escalation and accountability on disputes or other exceptions that may arise when dealing with diverse payment methods.

For more information on supporting payment methods with Stripe, readour docsorcontact our sales team. To start accepting payments right away,sign up for an account.

4. More about payment methods

Based on your customer’s geography and your business model, identify relevant payment methods to integrate by reviewing a comprehensive list of Stripe-supported payment options. You can also see which payment methods are available for your account by visiting the Dashboard.

Create an account and start accepting payments—no contracts or banking details required. Or, contact us to design a custom package for your business.

Accept payments online, in person, and around the world with a payments solution built for any business.

Find a guide to integrate Stripe's payments APIs.

A Guide to Types of Payment Methods | Stripe (2024)

FAQs

What payments can be accepted with Stripe? ›

Stripe's payments platform lets you accept credit cards, debit cards, and popular payment methods around the world – all with a single integration. Get access to advanced payments features like 3D Secure 2 authentication, card updates, automated retries, and more.

What credit cards are accepted by Stripe? ›

Supported payment methods

In the United States, you can accept these cards: Visa, Mastercard, American Express, Discover, JCB, Diners Club, China UnionPay, debit cards. You can accept a range of other payment methods, depending on the country of your Stripe account (which you set when you activate it).

Is Stripe a legit payment method? ›

It is accredited by the Better Business Bureau (BBB) and maintains an A+ rating. Stripe offers a global payment system that can accept more than 135 currencies with transparent pricing and discounts for high-volume merchants.

What forms of payment does Stripe take? ›

Learn about payment methods
  • Cards.
  • Bank debits.
  • Bank redirects.
  • Bank transfers.
  • Buy now, pay later.
  • Real-time payments.
  • Vouchers.
  • Wallets.

What are the three payment types? ›

3. What are the 3 methods of payment? The three most common payment methods are cash, credit cards and debit cards.

How many methods are there for payment? ›

A payment can be made in the form of cash, check, wire transfer, credit card, or debit card. More modern methods of payment types leverage the Internet and digital platforms.

Why won't Stripe accept my credit card? ›

There are three reasons why a payment might fail: Issuer declines. Blocked payments. Invalid API calls.

What does Stripe not accept? ›

As described in our Restricted Businesses list, we can't support many financial services businesses, including investment and credit services, money transmission, bill pay or crowdfunding services, digital wallets, or cryptocurrency-related business (crypto mining equipment, initial coin offerings, or purchase and ...

Does Stripe work with all banks? ›

Users can link accounts instantly from approximately 5,000 financial institutions, representing more than 97% of bank accounts in the US. Users can manually validate accounts from any US financial institution via micro-deposits.

What is the disadvantage of Stripe? ›

Cons of Using Stripe

High Processing Fees: With a 2.9% + $0.30 per transaction fee, as well as potential monthly fees and several hidden fees, costs can accumulate rapidly for businesses with a high volume of transactions. Limited Merchant Acceptance: Stripe supports only specific Merchant Category Codes (MCCs).

Can I trust Stripe with my SSN? ›

Our users trust Stripe with their sensitive data and rely on us to be good custodians of their customers' data as well. As a payments infrastructure company, our security posture continually evolves to meet the rigorous standards of the global financial industry.

Is it safe to link a bank account to Stripe? ›

Learn more about the safeguards we've put in place to protect data transfers and control access. Our service providers also use encryption to protect your data and are required to protect the security and confidentiality of personal data they process for Stripe.

Do Stripe payments go directly to bank account? ›

Payouts are sent to the bank account on file at the time the payout is initiated. If that account is closed, banks will then either inform Stripe that the bank account is closed and return the funds to your account automatically or contact you directly to disperse the funds.

What is the minimum amount for Stripe? ›

The minimum amount is $0.50 US or equivalent in charge currency.

How do I pay someone on Stripe? ›

Pay out to your user

To pay your user, go to the Balance section of an account's detail page and click Add funds. By default, any funds you transfer to a connected account accumulate in the connected account's Stripe balance and are paid out on a daily rolling basis.

How many payment methods does Stripe accept? ›

Diverse payment methods

Wallets: Stripe supports wallet payment methods, such as Apple Pay, Google Pay and PayPal (only available in Europe), so that customers can avoid entering card or billing information manually. BNPL: Options such as Affirm, Afterpay/Clearpay and Klarna are available, giving customers flexibility.

Does Stripe accept Venmo? ›

Choose a payment provider or app: Popular options include PayPal, Venmo, Alipay, and WeChat Pay. Generate QR codes: Create QR codes for each transaction or product, and link them to your payment account.

Does Stripe accept ACH payments? ›

Stripe supports ACH Direct Debit for businesses based in the United States and the United Kingdom.

Top Articles
Latest Posts
Recommended Articles
Article information

Author: Zonia Mosciski DO

Last Updated:

Views: 5407

Rating: 4 / 5 (51 voted)

Reviews: 90% of readers found this page helpful

Author information

Name: Zonia Mosciski DO

Birthday: 1996-05-16

Address: Suite 228 919 Deana Ford, Lake Meridithberg, NE 60017-4257

Phone: +2613987384138

Job: Chief Retail Officer

Hobby: Tai chi, Dowsing, Poi, Letterboxing, Watching movies, Video gaming, Singing

Introduction: My name is Zonia Mosciski DO, I am a enchanting, joyous, lovely, successful, hilarious, tender, outstanding person who loves writing and wants to share my knowledge and understanding with you.