A Guide to Stripe Fees for Marketplaces
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A Guide to Stripe Fees for Marketplaces

Arsh Shah Dilbagi
Arsh Shah Dilbagi
October 7, 2022
In this article, we explain what Stripe is, how it works specifically for marketplaces and the costs associated with using the service. Additionally, we’ll share alternative ways that marketplaces can accept payments directly to save on costly processing fees.

What is Stripe?

Stripe is a leading payment processing platform that allows merchants and platforms to accept a variety of payment options from their customers in a safe, secure manner.

Customers are more likely to proceed with a purchase if their preferred payment method is available. Adding payment methods is fairly simple to do with Stripe, which makes the service so appealing. In addition to offering payment choice, transactions are processed quickly and securely, increasing overall conversion rates.

How does Stripe work?

First, a marketplace must set up a merchant account with Stripe. Most marketplaces opt for Stripe Connect, which is the fastest and easiest way to integrate payments for marketplaces (1).

After Stripe Connect is set up, marketplaces can then accept payments from customers entering their payment information at checkout. The payment details are encrypted by Stripe’s payment gateway, and the data is sent to the acquiring bank to process the transaction. Once the transaction has been processed, Stripe will deposit the transaction amount minus transaction fees into the seller’s Stripe Connect account.

On the payout side, marketplaces can determine whether to receive the payouts directly, or whether the funds should be sent to another party, such as a vendor. They can also stipulate whether payouts should be executed manually, or automatically on a daily, weekly, or monthly basis.

How much does Stripe cost?

Stripe’s fees vary depending on the services that are utilized. While the fees may seem palatable at first glance, it’s essential to understand the overall costs and how they impact your bottom line.

Below, we break down the standard fees that are charged for Stripe Connect, assuming a 10% marketplace commission rate:

Stripe Cost/Fee Table

Stripe charges 2.9% + $0.30 for each transaction, plus another 0.25% + $0.25 per payout. For food delivery and retail marketplaces, most transaction amounts range between $25-75. While the percentage-based portion of Stripe’s processing fees is just that - a percentage of the transaction amount - it is the flat rate fees that can become cost prohibitive, especially for smaller purchase amounts.

For a $75 and $25 transaction, the flat rate fees associated with transactions and payouts cost marketplaces an additional 0.73% and 2.2% in transaction fees, respectively. This equates to overall processing fees of 3.85% to 5.31%!

In addition to the standard fees listed above, marketplaces may also incur the following fees if additional services are utilized:

  • Radar, Stripe’s fraud detection service, is free for Stripe Connect merchants but costs an extra $0.02 per transaction if fraud teams want to leverage the platform’s advanced tools
  • Stripe ID offers programmatic identity verification for an additional $1.50 per verification and $0.50 per lookup

Accept payments directly

It’s possible to directly integrate with other payment products via a simple API integration. For example, pay-by-bank has become an increasingly popular payment option amongst Gen Z and millennial consumers who are used to paying by Venmo or Cash App. While Venmo and Cash App are well-known, they can also charge merchant fees up to 5%.

Zage is a new pay-by-bank option that offers a seamless, gamified rewards experience to customers, resulting in a 56% increase in repeat purchases and a 32% increase in average marketplace order values. Zage also charges a low, flat rate fee, up to 85% lower than the rates charged by Stripe and its competitive counterparts. Plus, Zage covers identity verification, fraud detection, and fraud liability on any Zage transaction. By directly integrating via Zage’s API, marketplaces can get up and running in less than 2 hours, and significantly reduce overall processing costs.


Stripe Connect is a powerful platform that offers marketplaces a fast and easy way to set up and offer multiple payment options for customers to choose from. However, given the high costs associated with using the service, it’s prudent to consider directly incorporating alternative payment methods, such as Zage’s pay-by-bank option, to improve overall unit economics.

Want to learn more? Contact Zage today!


  1. Stripe
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