Stripe Fees Explained: What Every Merchant Needs to Know

Please note that the information about the companies in this article was sourced from their respective websites as of May 2025. This information may be subject to change.

Stripe is big, trusted, and everywhere—and that’s exactly why so many businesses use it. But behind the slick setup lies a real problem: Stripe merchant fees add up fast.

From transaction fees to payout charges and surprise extras, Stripe can quietly eat into your profits—especially if you run on tight margins or deal with high volumes.

The upside? There are modern alternative payment methods that deliver the same smooth payment experience, with fewer fees and more money in your pocket.

What Is Stripe’s Pricing?

Stripe doesn’t charge a monthly fee for its standard payment services. Instead, you pay per transaction, so you only get charged when you make a sale. Here is the breakdown of Stripe’s transaction fees.

For the purposes of scope, this article will focus on Stripe’s processing fees for online transactions.

Stripe Costs for Domestic Transactions

Read: How to Reduce Card Processing Fees

Stripe Rates for International Transactions

Stripe’s Service Charges for Payments

On top of Stripe’s fees per transaction, the provider adds extra charges for things like payouts, chargebacks, and disputes. Here’s a closer look at what those costs can include.

How Stripe Fees and Charges Add Up

Stripe’s payment fees seem straightforward at first—just a small fee per transaction. But once you take a closer look, you’ll notice how quickly the extras can stack up.

Let’s break it down with a real-world example. Say you're a UK-based online store making £20,000/month in sales, with most customers paying by standard UK cards.

• Transaction fees (1.5% + 20p): For 500 transactions at an average of £40 each, you’d pay: £300 (1.5% of £20,000) + £100 (20p x 500) = £400/month

Now add:

• Instant payouts (1% of total): £200
• 1 chargeback: £20
• Using your own domain: £8/month ($10)

That’s £628/month in fees—over £7,500 a year—and that’s without international cards, premium cards, or other options, which cost even more.

For many small to mid-sized merchants, especially those with tighter margins, Stripe’s rates and fees can start to feel a bit heavy. That’s why more businesses are beginning to explore simpler, more cost-effective alternatives that still deliver a great payment experience.

Lower Fees with Pay-by-Bank

If Stripe’s layered fees and complex pricing are starting to feel like more trouble than they’re worth, you’re not alone.

Many businesses are now switching to pay-by-bank—a faster, more cost-efficient way to take payments that skips card networks entirely. While Stripe does offer this option, its pay-by-bank is so far limited to UK-only.

Powered by open banking, pay-by-bank sends money directly from account to account. There are no card network fees, no middlemen, and no delays. It offers instant, secure payments with no chargebacks and better UX.

Here’s how it works:

1. Your customer selects pay-by-bank at checkout
2. They choose their bank (Noda connects to 2,000+ banks across 28 countries)
3. They confirm the payment in their app using Face ID, fingerprint, or passcode
4. You get paid—instantly

Open banking is PSD2-regulated and trusted by over 14 million people in the UK and 63 million across Europe—especially among younger, mobile-first shoppers. It’s simple, secure, and built for modern businesses.

Integrate Pay-by-Bank with Noda

At Noda, we’re the experts of pay-by-bank payments, with open banking coverage of 2,000 banks in 28 countries (UK and EU), and transaction fees ranging as low as 0.1-1%.

We also make sure your payment integration is smooth. You can choose the setup that fits your business:

• Need flexibility? Build your own checkout with our Open Banking API.
• Want speed? Share instant payment links or QR codes.
• Using Magento, WooCommerce, or another e-commerce platform? Just install a plugin and go live in minutes.
• With Noda, you’ll get your own personal account manager to guide you through setup and support you every step of the way.

Smarter payments, built for how you do business.

Why Switch to Open Banking Payments

• Keep more of your revenue – With no card networks or third-party wallets in the way, you avoid unnecessary fees.
• Get paid instantly – Payments go straight to your account, improving cash flow and cutting out payout delays.
• Faster, cleaner checkout – No passwords or extra logins. Just a quick approval via your customer’s banking app.
• Built-in security – Open banking uses regulated APIs and multi-factor authentication to keep every transaction safe.
• No chargebacks – Payments are authorised in real time and can’t be reversed, so you won’t lose money to disputes.