Stripe has risen to prominence as one of the world’s leading and most trustworthy payment service providers (PSPs).
Stripe is transparent about its security efforts, providing an array of online resources detailing compliance standards, encryption protocols, deposit insurance, and bug testing, among others. The payment service uses a variety of security measures to protect its merchants and their customers, including FDIC insurance, encryption, tokenization, penetration testing, and more. Moreover, Stripe employs a third-party “bug bounty” program to preemptively detect any vulnerabilities in its security system.
Stripe has valid licenses and registrations across the world, making it a suitable choice for businesses handling international transactions. Stripe is licensed to provide services in 46 countries, including the United States, Australia, France, Hong Kong, Ireland, Singapore, Brazil, Canada, Germany, Italy, the United Kingdom, and more. So when a merchant uses Stripe it is ensuring that it’s customers are using a payment service provider approved by some of the world’s leading financial regulators. Some of the largest companies in the world trust Stripe for processing payments. Industry giants like Amazon, Google, Target, Doordash, Instacart, Booking.com, Zoom, and Deliveroo use Stripe to accept customer payments.
Comparing Stripe’s Security With Others
PayPal and Square are two other popular PSPs offering similar in-person and online payment solutions to Stripe.
Customers can use PayPal to process payments and store card details, making it easy for online shoppers to purchase products and services without re-inputting card details. However, with PayPal, customer card details are still processed through the merchant’s servers, resulting in extra security responsibilities for businesses using PayPal.
On the other hand, Stripe allows businesses to avoid processing credit card details through the merchant’s servers, reducing compliance requirements and risks. By shouldering additional data security responsibilities, Stripe makes it easier for merchants to maintain strong safety protocols. Additionally, PayPal accounts are not backed by FDIC insurance, whereas Stripe users can access FDIC-insured accounts.[6]Consumer Financial Protection Bureau. “Analysis of Deposit Insurance Coverage on Funds Stored Through Payment Apps“. This means if PayPal fails as a business, your funds may be at risk.
Square is another popular payment provider offering a range of in-person and online payment tools. Square offers similar security features to Stripe. Both companies offer FDIC-insured accounts, PCI DSS compliance, rigorous security testing, payment encryption, and other useful security tools. However, Square doesn’t provide as advanced digital payment features as Stripe. Square is better suited for in-person transactions. The company is renowned for popularizing smartphone-based card readers among businesses nationwide and it offers a variety of industry-specific POS software platforms. On the other hand, Stripe is admired specifically for its advanced online payment tools.
Stripe allows merchants to set up accounts insured by the Federal Deposit Insurance Corporation (FDIC). In most cases, FDIC insurance provides up to $250,000 in coverage for eligible accounts at banks approved by the FDIC program. This ensures an account holder will receive a refund of up to $250,000 if the bank collapses. The program is an integral component in preventing bank runs.
FDIC insurance isn’t always available at payment service providers, putting Stripe ahead of many of its competitors. PayPal, CashApp, Venmo, and many other digital payment provider accounts don’t have coverage from the FDIC program, making them much higher risk.
Conclusion: Stripe Is The Safest Payment Service Provider For Our Customers
Stripe demonstrates a strong commitment to providing security-focused payment services to its users. The company combines robust compliance with targeted security testing, including using white-hat hackers to spot vulnerabilities and avoid exposure to security threats. Stripe merchants also have access to strong authentication tools to prevent scammers from using stolen credit card details. Likewise, merchants can set up FDIC-insured accounts via Stripe, providing extra protection from payment provider bankruptcy.
