Stripe refunds: fees from the original charge are not returned • Hacker News Board

Re: Stripe refunds: fees from the original charge are not returned

#251

Post by quelltext » Thu, Feb 20, 2020, 4:21 PM UTC

nickjj wrote: post #247

quelltext wrote: post #245

Earlier quoted context omitted.

My understanding is that what Radar does that you cannot is the ML to calculate the risk scoring and they give that to you for free: https://stripe.com/docs/api/charges/object#charge_object-out... EDIT: It appears that risk_score is indeed not available but risk_level is. You are still able to use your own logic to say for instance "don't capture if card country and tokenization IP country don't match and risk_level…

> But you can. The majority of what Radar custom rules allow you to do you can implement fairly easily on your own. You can even take the risk scoring into account by separating auth (then looking at risk level and make your own decisions) and capture: https://stripe.com/docs/api/charges/object#charge_object-out... Did you read the documentation you've linked to? :D This field you linked is only available with Radar…

True, but you can still use the less granular risk_level. So yeah, you don't get the full detail but you can still use the data they learned.

> So as mentioned before, this feels really dirty because they are taking your private data and are profiting from it by selling it back to you and others in the form of insurance -- and there's nothing you can do about it.

No, you and everybody else processing on Stripe has left that data there whether it's used for Radar's ML or not. I absolutely don't see anything dirty with them monetizing the software they built on that data.

Re: Stripe refunds: fees from the original charge are not returned

#252

Post by nickjj » Thu, Feb 20, 2020, 4:25 PM UTC

patio11 wrote: post #250

nickjj wrote: post #246

Earlier quoted context omitted.

> You're also welcome to do post-charge processing using our risk scores. But if it's a post-charge operation, then the transaction already took place and it's too late. If I need to refund a transaction after the fact because the transaction looks risky, then I lose out on the non-refundable processing fee that you now take, so I lose there. Can you lay out a 100% exact work flow of how I can implement what Radar fo…

I understand that you are contemplating a build-or-buy decision and do not want to purchase the software which we sell. You can ask the engineering teams that you want to dedicate to this to scope out the build option; there are likely tradeoffs you can make which would make this a 3 engineer-year project or 30 engineer-year project. It is implausible that their design document for the build option will conveniently…

> I wish your teams the best of luck and skill in this project. If in the alternative you would like to dedicate their time and attention to more pressing concerns in your business, our software is available for 2 cents a transaction.

Do you happen to work for Stripe support?

I'm just asking because your response reminds me of how they addressed my questions in email. It's very dismissive of my original questions, and then tries to guide the conversation away from my question into some type of "hey, good luck with whatever you do" response.

I'm not asking for an evaluation of whether or not it's a good use of engineering time for me to implement this feature. I'm just asking how I can do risk score assessment on my own without paying your extra transaction fees, or be forced into doing a post-transaction refund (and then lose the transaction fee on the refund).

You mentioned I'm free to do my own risk assessment, but I'm trying to say that's not possible to do in such a way that doesn't involve me paying extra money to Stripe since your API purposely goes out of its way to remove critical information unless you pay extra for Radar for teams (in which case using your API for this info wouldn't be necessary since your platform would provide that functionality in your dashboard).

Re: Stripe refunds: fees from the original charge are not returned

#253

Post by quelltext » Thu, Feb 20, 2020, 4:34 PM UTC

mtnGoat wrote: post #161

pc wrote: post #120

Earlier quoted context omitted.

> Stripe has all the power to prevent many forms of fraud and provides this as a service as long as you pay a premium for it in the form of Radar. You have to pay extra on top of the 2.9% + 30c per transaction to get this protection. Radar's ML-based shield is free for all accounts on standard pricing. See https://stripe.com/pricing#radar-pricing . (We only charge if you want to set custom rules etc.)

Custom rules are the useful ones! The cost of Radar is a huge gripe of mine as well, we have lost thousands to a single fraudster that would have been easy to block with simple rules... The loss was less then the cost of Radar though. ;( Otherwise, the API can be a bit confusing, but I've learned to just be very careful when I read the docs and to read them throughly.

What were those simple rules?

I'm curious of whether they really required Radar custom rules specifically or whether Radar rules would just have been more convenient than writing your own rule evaluator?

Re: Stripe refunds: fees from the original charge are not returned

#254

Post by lotsofpulp » Thu, Feb 20, 2020, 4:44 PM UTC

officeplant wrote: post #39

privateSFacct wrote: post #14

Earlier quoted context omitted.

Actually - it's mostly because of cost / benefit shifting. A card can attract USERS by increasing the rewards it offers -> and charging MERCHANTS for the reward. So visa infinite cards might charge a much higher swipe fee to a merchant, and then make available cash back + first party car insurance + lots of bennies to the holders of these "elite" cards. They justify this to merchants by claiming that these "elite" us…

Meanwhile it's become the new hot thing locally (Southern USA) to charge credit and debit card users a "convenience fee" sometimes as high as 35 cents a transaction. Everyone went from offering discounts to cash users to simply charging card users more.

What is the difference between a "discount for cash payers" and "convenience fee for card users", when the only two options are cash and card? In both scenarios, price for purchasing with cash is less than price for purchasing with card. Seems like semantics to me.

Re: Stripe refunds: fees from the original charge are not returned

#255

Post by quelltext » Thu, Feb 20, 2020, 4:50 PM UTC

commoner wrote: post #141

brunoTbear wrote: post #29

Earlier quoted context omitted.

I think you don’t understand the card ecosystem particularly well. My impression (ex Stripe with no inside knowledge) is that Visa has been raising rates. Stripe are doing their best to avoid passing it on. This is one place where it surely became egregious not to. I’ve never seen a company as averse to squeezing users as I had when I was there. The finance guy I worked with produced analysis for the team showing way…

> Stripe are doing their best to avoid passing it on. This is one place where it surely became egregious not to. According to the rest of the discussion on this page, Visa and other payment networks refund the interchange fee to payment processors (including Stripe) on refunded transactions. There is no evidence that Stripe is any more charitable to their users than other payment processors. Stripe offers a commodity…

> According to the rest of the discussion on this page, Visa and other payment networks refund the interchange fee to payment processors (including Stripe) on refunded transactions.

So far said that the refund fees on the brand side specifically increased or came into existence. I don't know if they did or not. I imagine though that transaction fees rising (which people do mention in the discussion) has an effect here. If you were able to make a given margin before while still allowing refund fees to be returned. Now transaction fees increase. As a PSP you can either choose to increase your processing fees or find other ways to make even. If you can achieve that by not returning fees on refunds (and make a bit more money along the way) that makes sense to me.

My main point is that rising fees in general can be a reason here even if the card brands didn't specifically add a new cost to refunds per se.

Re: Stripe refunds: fees from the original charge are not returned

#256

Post by patio11 » Thu, Feb 20, 2020, 5:01 PM UTC

agopaul wrote: post #235

patio11 wrote: post #158

Earlier quoted context omitted.

Businesses invest in product development and marketing to bring a customer to them. The customer is convinced of the value of the thing they want to buy and puts in their credit card number. Sometimes it doesn't work, for example because a poorly understood interaction of systems at their bank decides the charge is likely fraudulent. (Ask me about how a particular US bank has caught 17 of the last 0 times a fraudster…

Appreciate the explanation. We actually noticed a huge improvement since last summer with charges made with Stripe. Still, we lost a few thousands €€ in these years because of customers' banks rejecting our transactions. I hope that one day this problem will be gone.

We share that desire, and are iterating on this a thousandth of a basis point at a time, because at the scale of the internet it really matters. (Anyone want to work on this? Super fun stuff. https://stripe.com/jobs/listing/backend-api-engineer-acquiri... You get to e.g. build systems which blackbox reverse engineer the behavior of financial institutions worldwide, in some cases getting to explain the behavior of their systems to them directly because the people who built them retired years ago.)

Re: Stripe refunds: fees from the original charge are not returned

#257

Post by quelltext » Thu, Feb 20, 2020, 5:05 PM UTC

elijahparker wrote: post #140

There are multiple little things that make me feel less trusting of stripe and that it’s shifting away to be more profit focused instead of customer oriented. One change that was unannounced (to my knowledge — maybe I missed something) was the payout schedule. It’s still two days technically, but at some point last year they started delaying the payout in their end if it was a weekend or holiday. It used to be like t…

FWIW they do mention it's 2 business days on their docs and have been for quite some time if I remember correctly.

https://stripe.com/docs/payouts#2-day

Not sure if that was the case in the past though or when it would have changed. I don't have any reason to doubt your story, so it's possible.

What you describe would be a calendar days setup I guess and I agree that changing that silently (on the same account) would piss me off. There might be good reasons for them to change it but not without reaching out to affected users. Or did you only see this new behavior on a different/newer account?

I'd say you should raise that with their support team! It should be fairly easy to find evidence of that change for Stripe, right? And you should also be able to find evidence of the old behavior (a bit of search work in the balance history but doable).

EDIT: I tried to go back on the wayback machine and it said business days for quite some time before last year (https://web.archive.org/web/20170905023631/https://stripe.co...).

Still possible that your account is much older and you were grandfathered and then finally moved over to the new behavior long after this was standard for everyone. I'd really just check with them.

Re: Stripe refunds: fees from the original charge are not returned

#258

Post by poxrud » Thu, Feb 20, 2020, 5:08 PM UTC

Meekro wrote: post #32

vfclists wrote: post #11

They are doing a Paypal. How long have they been doing this? Louis Rossmann won't be happy - https://www.youtube.com/watch?v=c1WPDVjXDj0

I'm a long-time Stripe user who processes ~$40k per month, and I think you're being too harsh. From a business owner's perspective, PayPal is the kind of company that would shut down your account and steal the balance for 6 months if their shitty algorithm detects anything "suspicious." Your attempts to contact them can be ignored or given generic responses that tell you nothing. PayPal just doesn't care, and it show…

That is absolutely incorrect. Eventually every account will have to pay, they just didnt get to you yet.

You mention $40k/month, that is irrelevant to what is being discussed here, more importantly is what is the amount of refunds that you process? That amount times 2.9% is your new reality.

Re: Stripe refunds: fees from the original charge are not returned

#259

Post by ValentineC » Thu, Feb 20, 2020, 5:20 PM UTC

slenk wrote: post #172

ValentineC wrote: post #63

Earlier quoted context omitted.

> From a business owner's perspective, PayPal is the kind of company that would shut down your account and steal the balance for 6 months if their shitty algorithm detects anything "suspicious." Your attempts to contact them can be ignored or given generic responses that tell you nothing. Heh, PayPal just this month asked me to provide charity information for my personal account, and subsequently limited my receiving…

What do you mean by charity information? What charities he likes to give to? I have never heard that phrase before.

For my case, their Resolution Centre asked me to provide "DD Business Information" — which I obviously won't have.

A quick search suggests that this incident isn't uncommon:

[1] Paypal Thinks I am a Charity Organisation: https://www.paypal-community.com/t5/Disputes-and-Limitations...

[2] Provide charity info - DD Business Inormation: https://www.paypal-community.com/t5/Disputes-and-Limitations...

[3] What's DD Business Information: https://www.paypal-community.com/t5/Disputes-and-Limitations...

Re: Stripe refunds: fees from the original charge are not returned

#260

Post by dhimes » Thu, Feb 20, 2020, 6:17 PM UTC

adrr wrote: post #169

jfim wrote: post #87

Earlier quoted context omitted.

> we built an ML engine to automatically optimize the bitfields of card network requests For someone who's not in the payment industry, could you elaborate on what this actually means?

There’s a few fields you can set meta data around the transaction. Eg: it’s a recurring charge Every processor optimizes this though.

I wonder how it added $1B of revenue to Stripe's customers.