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Stripe Atlas Is Nothing But A Bad Marriage

Written by Viet Nguyen / 30.05.2018 / Views

At the early stage of my business, I used one Stripe accounts for several, distinct sites to consolidate online stores. One (an online merch store that I bought, which was most likely targeted by fraudulent chargebacks from items that we already shipped out) had a higher dispute rate than average threshold. Account gets closed. Stripe offers me to just open a new account, but had no concern that my Atlas dashboard would disappear as well, even though they say Atlas dashboard would still be there.

Their lack of responses made the issue 5 months longer than it needs to be.

Stripe Radar 1.0 was advertised as a way to detect and block fraudulent purchases using machine learning, however it couldn’t even detect obvious fraud, and the support team outright deny the responsibility for it.

Stripe’s real concern was to keep good numbers for their upstream provider, and would turn away from business owners in favor of their upstream provider (as an agent/ISO).

People say I spend more time to write a public complaint than it would take to set up a new account. However, as a Stripe Atlas member, Stripe closed the account and removed the Atlas dashboard that was offered exclusively for Stripe Atlas member, while saying they still have me as a Stripe Atlas customer.

It’s an ill-fates story of passion and love. She came into my life with the promises of everything I’d wanted, and things I never knew I needed.

And then she gutted me.

I’ve come home expecting the usual but instead I’m still trying to comprehend what the &^%$ happened even months later.

Stripe is, hands down, the worst break up I’ve ever had. I find myself stuck in a bitter place where I’m angry and distraught over how I was treated while wanting them to take me back at the same time.

I’m angry and distraught over how I was treated while wanting them to take me back at the same time.

Let me backup… context is important.

If you’ve got a product or service, you can throw a rock in any direction online and hit a payment processor willing to help you launch your business. Every one of them uses flower copy designed to convert, emphasizing the benefits of teaming up with their platform.

The problem; for the tens of thousands of services there’s only a few real payment processors.

TSYS, Chase Paymentech, First Data, Vantiv/NPC, WorldPay, Heartland

The platforms and services we see, populating organic search results and pressing benefit statements through paid ads are ISO’s. They’re third party agents.

And there are a lot of them.

That made it difficult in the early days of launching myself as an entrepreneur and getting my first business rolling.

I ultimately chose Stripe because it stood out from the other TPA processors. It wasn’t just about who could offer the lowest per transaction fee or interchange pricing. What attracted me to Stripe was that it was building a developer-first product that made it easy for scrappy startups to jump in and launch.

Their startup story was impressive, and I loved the company culture.

It didn’t take long after integrating with Stripe for me to realize why so many were raving about it. Powerful hype-engine aside, Stripe legitimately worked to delight its customer base.

Other processors tend to get in the way of the experience taking place between a brand and a customer. Services like PayPal are larger platforms that will process for you but they also want to leverage that opportunity to create and build their own relationship with your customer.

Imagine trying to checkout at your local hardware store and while you catch up with the owner about how things have been the credit card terminal starts loudly interrupting to prompt you with personal questions and special offers.

Stripe didn’t do that. I loved that. I fell hard for a processor that let merchants retain control of customers and the experience.

Unfortunately, what I’ve been forced to remember in recent months, is that passion and loyalty don’t always go both ways and some brands — like Stripe — have no qualms about screwing you before leaving.

It’s not me, it’s you

After being a long-time Stripe and one of the very first Stripe Atlas member, using it for payment processing across a spread of digital only and omnichannel businesses, I got ‘the letter’ on January 17th, 2018.

There was a sudden influx of fraudulent activity after having an account in good standing. Stripe didn’t like that.

While their team recommended ways to help reduce fraudulent activity, and they didn’t immediately lock my account, they froze payouts.

I questioned the decision given that not only was I long-time customer of Stripe with an account in good standing (at least until now, apparently), I was also a Stripe Atlas customer.

“Was” is the operative word there.

Stripe Atlas isn’t necessarily an exclusive service but it’s intended to be a cut above standard Stripe accounts. It required either an invitation from an existing Stripe Atlas member or approval through a weeks-long vetting process.

That status had no bearing in this case apparently. I understood the need to investigate — mistakes and fraudulent activity happen and need to be reviewed.

But they refused to allow for any payouts to take place and instead demanded to know more about my business(es)

I provided details on steps we were taking to prevent chargebacks in the future including:

  • Already using Stripe Radar
  • Implementing TrueAccord and few other platform specific integrations depending on the business and platform it used.

Ten days after the initial letter from Olly and he replied to let me know the account was still in review. Immediately following was a string of emails that still have me shaking my head in frustration and confusion, beginning almost immediately after the previous email was received.

But I’ve always been a passionate supporter of Stripe and wanted to comply with the requests.

We reimburse all chargebacks, and took a loss.

Their team was initially receptive.

I supplied all the information relevant to their request including administrative login for that particular store where all the chargebacks took place. While unnecessary I wanted the representatives at Stripe to know we were completely transparent.

I had hoped this would help clear the matter. Relationships that you desperately want to hang on to can be colored by rosy optimism.

Their response took the issue in a new direction…

Somehow we moved from an issue of fraudulent activity to whether or not we’re allowed to sell specific products. Despite the fact that this felt like Stripe was now looking for additional reasons to terminate the account I wanted to comply as best we could.

We’ve legitimately had great success working with Stripe to this point. On February 2nd I informed them that I did not yet have reseller contracts from the eCommerce stores previous owner as they weren’t supplied during the buyout.

I also let them know that if that would be a problem I was more than happy to shut down that store and/or remove the products in question simply because the relationship we had with Stripe was far more valuable.

Ollie (name changed) responded the next day letting me know they were continuing to review the case and they would get back with me in a day or so.

With each day that passed my hope continued to dwindle. While it was still possible for us to accept payments and keep operations running across out businesses, Stripe wasn’t providing payouts.

At this point, communication went dark for far too long until I once again reached out letting them know the action we took… and finally got a response.

Note the date.

And the bomb dropped.

Despite understanding that our Stripe Atlas account was used across a number of businesses, and that the seemingly fraudulent/chargeback activity took place in a relatively short span of time through a single eCommerce store (that was no longer operational), Stripe chose to label us as “high risk” and shut us down.

But at least they wished us luck…

Because of the relationship we’d previously developed with Stripe, and our engagement in the Stripe & Stripe Atlas community, I wasn’t willing to give up.

Granted it also had to do with payouts still being held, but Stripe had been with us since we started and I’m not one to jump ship. Loyalty is important.

I had recently attended a Stripe Atlas meetup in NYC and networked with some folks at Stripe. I reached out, optimistic that they may be able to help.

I felt like I would finally get some movement here. Knowing what I know about Stripe’s culture and what I’d heard about their approach to delighting customers/developers I was hopeful this would expedite the process and bring about a resolution faster.

And it did, for sure.

If by “expedited” I meant something akin to a car traveling down a mountain, jerking the wheel, and sailing off a cliff in order to reach its destination.

Matt (name changed) removed himself and brought Whitney (name changed) into his place. Ollie (name changed), rep who had largely dealt with the matter until now, was now replaced by Angus.

It had taken months to get to this point and but now after providing appropriate proof and leaning on internal contacts for support we apparently swung a bat at a hornet’s nest.

Despite established relationships, and Matt (name changed) was a nice person that I met when going to Stripe Atlas community dinner with. Stripe is quick to put all blame and responsibility on us by claiming that it is not their responsibility to prevent fraud.

As a business owner, the only way we can prevent and mitigate fraud is by using the tools at our disposal — often the ones provided by merchant processors and payment gateways. After researching the issue it seems this is an area where Stripe is woefully lacking.

The Stripe Radar 1.0 did not effectively help in any way with fraud detection, even though it was advertised as using machine learning to better detect fraudulent payments (sounds better than Paypal, of course).

Kinsta reported a similar incident where they dealt with fraudulent activity using Stripe.

I’m not the first one with this problem.

“Stripe has a chargeback fee of $15 so we were losing money on each transaction that, in my opinion, should’ve been stopped by Stripe even before they happened. For example, there was a guy who used the same email address and tried cards from 3 different continents in a span of 15 minutes. Unless he’s the Flash, that’s not really possible and it’s a huge warning for all payment processors I know of, yet Stripe didn’t blink an eye.”

It’s worth noting that Stripe also shut down processing for Kinsta after labeling them “high risk” without any real justification.

Of course, there are several other entrepreneurs and online businesses experiencing the same in recent years, and it doesn’t take much digging online to find their stories — which often sound alarmingly similar.

Like this user losing revenue due to fraudulent activity that wasn’t properly flagged while processing.

And this developer who found that despite using address verification Stripe was still processing cards without verifying the address for the card — similar to Kinsta’s issue above.

And another stripe customer shut down after experiencing a single incident that wasn’t even fraudulent and could be explained with simple customer records.

And you can find a whole thread on this Shopify forum with users experiencing the exact same issue, one after another.

Yet somehow, the fault rests with the business owner when Stripe’s system fails to do exactly what it’s supposed to do.

In the string of emails that followed with Stripe their rep continued to repeat the same calculations, citing that dispute rate calculations put our account at over 1%, making us high risk. This was the standard response to each email I sent back, requesting they review the information and take into account that it was a single isolated incident.

Their response would be coupled with the same closing statement.

“We will not reinstate your Stripe account.”

But here’s the problem with the way they’re calculating “high risk”.

Let’s say I’m a new Stripe customer and I’ve just launched a new software as a service (SaaS) that bills on a subscription model where customers pay weekly for access. I opt to take payments via Stripe for the service and everything is going smashingly.

Now let’s say I reach a point where I’ve taken one hundred payments but suddenly a single subscriber who had been using the service for a few months decides to go and file a dispute on all 4 of his payments after signing up a month ago.

By Stripe’s calculations we now have an more than average dispute rate by volume which is justification to close the account. Not only will they withhold all payouts at 100% reserve but you are now left with no ability to process payments until you can shoehorn a solution.

But wait… is Stripe really concerned about the risk or, as an processor agent, are they just trying to cover their ass?

After days spent imploring their team to work with me, reopen the account, release the payouts, and recognize that it was an isolated incident this was the final response — and it destroyed whatever love and passionate I once held for Stripe.

I can open a new account? That sounds easy enough right? They assured me that my Atlas customer status would still be intact, yet they removed my Atlas dashboard altogether.

Stripe wants to support my business.

Stripe wants to work with us.

In order to do that… I have to open a new Stripe account and start over, and not have access to my Stripe Atlas dashboard, even though they say it’d still be intact?

So, for all the argumentative emails throwing dispute percentages back at me, insisting that it is fully our responsibility to mitigate risk, that my business is too risky to continue… their final solution is that I should just register again with a new account and we’re good to go.

Why?

Because the new account doesn’t look “risky” and they can maintain clean numbers when reporting back as an agent/ISO.

This is the kind of experience that leaves a whole in you when you’ve been legitimately loyal to a company, passionate about its services, and stood as an outspoken advocate to its brand. It’s unfortunate when that relationship means nothing to the reps you wind up working with.

We were among the first 100 (if not the first 10) to be accepted into the Stripe Atlas program and I personally went to great effort to evangelize for them, sharing the new platform among the startup communities in Vietnam. Despite our upstanding history on Stripe, and our status in the Stripe Atlas community, they completely disabled our Stripe account and locked our access to the Stripe Atlas dashboard after I was already told that Stripe Atlas would still be available on my account.

I can understand delayed payouts and having a larger reserve due to chargebacks. What I cannot stomach is:

  • The reason for the account being closed changing over the course of the discussion
  • Getting senior management involved with no resolution
  • Arbitrary decision making despite our standing and history with Stripe

It’s even more frustrating when the decisions they make in cases like mine are so blatantly arbitrary.

Plenty of fish in the sea, I suppose…

P/S: Stripe Atlas was attached to my company’s dashboard, and as Stripe shut our account down, the Atlas dashboard also disappeared. They haven’t enabled it since even though I’m still Atlas customer.