Stripe Capital

Stripe Capital is a working capital financing product offered by Stripe, the widely used online payments technology company. Stripe Capital provides financing exclusively to businesses that process their payments through Stripe's platform.

Stripe Capital works differently from a traditional bank loan. Stripe reviews the payment processing history of your Stripe account and, if your business qualifies, may offer you an advance of working capital. There is no formal loan application in the traditional sense. Instead, eligible Stripe users may see a pre-approved offer directly in their Stripe dashboard based on Stripe's assessment of their payment volume and business health.

Repayment is automatic and tied directly to your Stripe sales. A fixed percentage of each payment you process through Stripe is automatically applied to repaying the advance until the advance plus a flat fee is fully repaid. On days with higher sales volume, more is repaid. On slower days, less is deducted. There is no fixed monthly repayment schedule.

Stripe Capital charges a fixed fee rather than an interest rate. To understand the true cost of the financing, business owners should calculate what the fixed fee represents as an effective annual rate and compare this against other financing options including bank loans and credit union products.

Stripe Capital is only available to businesses that already use Stripe to process payments. If your business does not use Stripe, this product is not accessible to you.

This type of platform-embedded financing can be convenient for Stripe users because the process is simple and requires no external application. However, it is most cost-effective when used for short-term working capital needs. Always compare the cost against alternatives before accepting.