Stripe – the new alternative to PayPal?
For companies that offer a software as a service (SaaS) product over the internet for customers who pay a monthly or 
annual subscription there is not a whole load of choice outside of dealing directly with credit cards (which can be an expensive and complicated choice).
PayPal would then seem like the obvious choice for taking customer payments without that added hassle of setting up payment gateways and merchant accounts, amongst the other technicalities involved in making payments work.
PayPal has been around for some time now, originating out of a need to make Ebay payments quick and easy, and it seems popular both with private and business customers, alike. So why are SaaS companies looking for alternatives?
Well, for a start, using PayPal means directing customers away from your own site. SaaS products usually work on a 
regular (monthly) subscription basis so their customers need to have a PayPal account set up to make regular recurring payments, and the setup requires their account to be verified.
PayPal falls down on the ability to field information on if a payment has failed. On failure, PayPal will attempt the payment 3 times and then will cancel the subscription, leaving the SaaS company to trace the failed payments themselves! So, without looking further, it’s clear that PayPal is perhaps better suited to the individual rather than the business with repeated payments.
So what is the alternative? If you’re in the US or Canada, the answer could be Stripe! Cost wise it is comparable with PayPal. The real bonus is that you can process credit card payments without re-directing your clients away from your own site which means it is easy to keep track of what’s happening throughout the payment process and capture problems. Retaining clients on your site for payments, means the set up is a little more involved – you have to build your own payment forms, for example, but this is a worthwhile trade-off for keeping that valuable control.
Since there is no storage of the credit card details there is no need for any PCI compliance to be in place.
One SaaS company, 5pm, a cloud-based project management application, has recently (March, 2013) added Stripe to its site for payment of their monthly subscriptions and they are delighted with the results.
For more information on Stripe payments, please see: www.stripe.com
For more information on 5pm project management software, please see: www.5pmweb.com
