Stripe

Stripe is a payment service provider that lets businesses accept and process online payments through a developer-focused API, combining payment gateway and payment processor functionality into a single integrated platform rather than requiring merchants to set up the two separately.

Stripe was founded in 2010 by Irish brothers Patrick and John Collison, who began building the company, then internally called /dev/payments, after experiencing firsthand how difficult and slow it was for a small business to start accepting card payments online.

At the time, integrating with a bank or an existing provider such as PayPal could take weeks of administrative work and still leave a business with limited control over the checkout experience.

Stripe’s original pitch centred on a now-famous seven-line code snippet that let a developer add working payment acceptance to a website in minutes rather than months, an approach that spread largely through word of mouth among early startups and Y Combinator companies.

Since launching its core Payments product in 2010, Stripe has expanded well beyond a simple payment gateway into a broader financial infrastructure platform. Connect, launched in 2012, lets marketplaces and platforms such as Shopify and Lyft manage payouts to multiple sellers or drivers from a single integration.

Later additions including Radar for fraud detection, Billing for subscription management, Tax for automated tax calculation, and Issuing for virtual and physical card issuance extended Stripe from a single payments API into what the company describes as a financial operations stack for internet businesses.

As of early 2026, Stripe reported processing roughly $1.9 trillion in total payment volume over the prior year, equivalent to a meaningful share of global GDP, with pricing built around its original transparent model of a flat percentage plus a small fixed fee per transaction rather than the bundled, harder-to-compare fee structures common among older processors.

Example

A developer building a new ecommerce checkout integrates Stripe’s API to accept credit card payments without negotiating a separate merchant account or building custom PCI-compliant infrastructure from scratch. When a customer completes a purchase, Stripe collects and encrypts the card details, authorises the transaction, and deposits the funds into the merchant’s bank account within a few business days, all coordinated through the same Stripe integration the developer originally set up.

Key characteristics

• Combines gateway and processor roles: Unlike setting up a payment gateway and processor separately, Stripe bundles both functions, simplifying the technical and financial setup required to accept payments.
• API-first, developer-oriented design: Stripe is built around a documented API intended for direct integration by developers, in contrast to older payment providers built primarily around manual merchant account setup.
• Transparent, flat-rate pricing: Stripe’s standard pricing follows a published flat percentage plus a small fixed fee per transaction, a model the company has marketed as more transparent than providers with multiple bundled fees.
• Expanded into broader financial infrastructure: Beyond core payment processing, Stripe now offers tools for marketplace payouts, subscription billing, tax calculation, fraud detection, and card issuance.
• Operates at significant global scale: Stripe is used by businesses ranging from early-stage startups to large public companies, processing trillions of dollars in payment volume annually across dozens of countries.

Related terms

• Payment gateway – the technology layer that securely transmits payment data, one of the two core functions Stripe combines into a single platform.
• WooCommerce – an ecommerce plugin that commonly connects to Stripe through a dedicated extension to enable checkout payments.
• SSL certificate – a security certificate that works alongside Stripe’s own encryption to secure the overall checkout connection.
• Refund policy – a store’s published rules for returning funds, which are processed back to a customer through Stripe when it is the payment provider used at checkout.
• Ecommerce – the broader category of online commercial activity that platforms like Stripe are built to support by enabling secure payment acceptance.

Frequently asked questions

Is Stripe a payment gateway or a payment processor?

Stripe functions as both, operating as a payment service provider that combines payment gateway and payment processor functionality into a single integrated platform. This means most merchants using Stripe never need to set up the two layers separately.

How much does Stripe charge for processing payments?

Stripe’s standard pricing follows a transparent, flat-rate model: a published percentage of the transaction amount plus a small fixed fee, rather than the multiple bundled fees, such as separate gateway and PCI fees, charged by some older payment providers.

Who founded Stripe and when?

Stripe was founded in 2010 by Irish brothers Patrick and John Collison, who built the company after experiencing how difficult it was for a small business to start accepting online payments at the time. Patrick serves as CEO and John as President.

Does Stripe only handle payments?

No, while payment processing remains Stripe’s core product, the company has expanded into a broader set of financial tools, including subscription billing, automated tax calculation, fraud detection, marketplace payouts, and card issuance, positioning it as a wider financial infrastructure platform for internet businesses.

AliDropship: An all-in-one platform for starting dropshipping in 2026

AliDropship is a dropshipping platform that covers store creation, product imports, order automation, and marketing within a single system. It is designed for users with no prior ecommerce experience, though it also supports scaling for more established stores.

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AliDropship requires no coding knowledge. The dashboard contains all the necessary tools for managing your store, products, and orders in one place. Additional features and products can be added as the store grows without rebuilding the existing setup.