Stax vs Stripe Payments: Which is Better?

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By Ewen Finser

Last Updated on July 2, 2023 by Ewen Finser

If you recently heard about the upstart Stax payments, but aren’t sure how it compares to a heavyweight like Stripe, you are in the right place.

I’ve personally struggled with payment integrations over the years for our various ecommerce businesses. There’s trade offs to all of them!

So my interest was definitely piqued when I heard about Stax. At first glance, it looked compelling. 

But it also hasn’t been around long, so I was concerned if it was legit and how it compared to a payment solution incumbent like Stripe.

In this comparison, I’ll break down the key factors I looked at when evaluating switching providers.

Let’s jump into it.

Distinguishing Features of Stax and Stripe

Here’s a high level comparison between the two payment processors:

Payment Methods
Offers both online and in-person payment methods
Offers both online and in-person payment methods, as well as traditional merchant account services
Underwriting Process
Not Required
Pricing for In-Person/Retail POS
Charges 2.7% + 5¢ per transaction
Offers custom pricing options which can be more affordable
Pricing for Online Payments
Charges 2.9% + 30¢ per transaction
Pricing varies depending on the size of the business and sales volume
Monthly Costs
No monthly costs
Monthly costs can range from $99 to $199 or more for larger businesses
Transaction Costs
Included in the pricing for online and in-person payments
Just pay interchange rates (no markup)

Stax: Feature-Rich Payment Solutions

At first glance, Stax and Stripe may appear to offer identical services to businesses operating across both digital and physical sales channels. However, upon closer inspection, the breadth and depth of Stax’s features outshine Stripe’s.

Stax’s all-encompassing software capabilities, coupled with its robust Point of Sale (POS) features, render it a potent force for businesses of all sizes. It offers a wide variety of industry-leading payment software and supports numerous POS devices.

When you sign up with Stax, it provides a complimentary terminal, with a choice of three state-of-the-art options. Moreover, Stax is compatible with most card readers, which can be reprogrammed to work seamlessly with the system. Stax’s software offers a payment gateway, pre-built shopping carts, and checkout pages, similar to Stripe.

Stripe: Designed for the Online World

On the other hand, Stripe’s primary focus is on online transactions. It offers pre-built shopping carts, checkout pages, a payment gateway, and a plethora of software integrations. Stripe allows payments in over 135 currencies, in contrast to Stax which only facilitates payments in USD.

However, Stripe’s POS functionality pales in comparison to Stax’s. Stripe only offers five hardware options, none of which are free, and you cannot reprogram your existing hardware to work with it. Thus, it essentially provides a DIY POS kit that requires custom programming.

Setting Up: Stax versus Stripe

Underwriting Process: A Necessary Step

One major difference between Stax and Stripe lies in their setup process. Stripe, functioning as a payment aggregator, allows you to sign up and start processing payments in a matter of minutes.

Conversely, Stax, like most “traditional” payment processors, requires new merchants to undergo an underwriting process before they are accepted, which can take up to two business days.

Security Over Speed

Although this may seem tedious, the underwriting process is an essential step that aids payment processors in mitigating the risk of losing money due to fraud. By lowering this risk, processors can offer more competitive rates.

While Stripe’s quick signup process may seem appealing, a glance at its reviews reveals the importance of choosing a payment processor that verifies its merchants. Stripe has received numerous complaints from customers about their payments being on hold or their accounts being closed without warning.

Compliance and Security: Stax versus Stripe

High Standards of Compliance

Stax and Stripe are both PCI Level 1 compliant, meaning they undergo annual auditing and quarterly network scans to ensure data security. Stax offers a decent level of PCI compliance support and fraud detection software, although it does not match the level offered by Stripe.

Stripe provides pre-filled SAQ A (for e-commerce merchants) and SAQ C (for merchants with one POS device/location), saving you considerable time.

State-of-the-Art Fraud Detection

Furthermore, Stripe offers Stripe Radar, an advanced fraud detection and prevention tool powered by machine learning. With the ability to adapt rapidly to new fraud trends, it ensures that payments from legitimate customers are not blocked.

This system operates automatically, requiring minimal intervention. However, if you wish to customize Stripe Radar’s fraud detection rules, there are guides available to help you set up blocks for certain card types, transactions from specific countries, and more.

Pricing: Stax versus Stripe

Different Pricing Models

The key difference between Stax and Stripe’s pricing lies in their models: Stax adopts a subscription-style pricing structure, while Stripe uses the more prevalent interchange-plus model. Neither Stax nor Stripe requires you to sign a contract or charges early termination fees.

Stax’s pricing model is highly beneficial for high-volume businesses, while Stripe’s pricing model typically works better for smaller businesses. Stax’s pricing model is more budget-friendly than Stripe’s and allows for easier budgeting of payment processing costs.

Flat Monthly Fee with Stax

With Stax, you have a choice of three pricing plans – Growth ($99), Pro ($159), and Ultimate ($199). The Growth plan comes with basic software, while the Pro plan adds a card vault, payment links, and more.

The Ultimate plan includes everything in the lower-tier plans plus advanced reporting, automatic card updating, one-click shopping carts, and data exports. On top of the flat monthly fee, you’ll pay a small flat fee of 0% + 10¢ (in-person) per transaction. As with most processors, you can expect to pay chargeback fees on top of this.

Per-Transaction Fee with Stripe

In contrast, Stripe charges 2.9% + 30¢ per transaction, which can significantly eat into your profits as your business expands. On the other hand, your Stax monthly fee will stay the same unless you upgrade for more features or start processing over $500,000/year, giving you plenty of room to grow before your fees increase.

Customer Support: Stax versus Stripe

Ready Assistance with Stax

When it comes to the quality and the number of channels available, Stax’s customer support scores higher. While both processors offer live chat and email support, plus a fairly comprehensive knowledge base, Stax adds an additional phone support channel. With Stripe, you’ll need to request a phone call through your dashboard, which isn’t ideal if you need help urgently.

Prompt and Detailed Responses

Stax responds promptly to queries, providing answers within a few minutes via live chat, and a next-day response to email queries. In contrast, Stripe’s response, although fast, often lacks specificity and may not address the exact question asked by the customer.

Other Top Stripe Alternatives Compared

Our editorial team has also evaluated a wide array of Stripe competitors, so check these out if you want a full view of the payments landscape:

The Verdict: Stax vs Stripe

Thanks to its subscription-style pricing and 0% interchange markup, Stax emerges as a more economical choice for most businesses. Additionally, it offers fantastic software included in your monthly fee, a plethora of POS hardware options, and superior customer service.

However, Stripe shouldn’t be written off. Its fraud detection and prevention tools, powered by machine learning, are top-notch. Despite its high markup and transaction fees, new businesses and those processing only a handful of payments each day may find it cheaper than Stax. Ultimately, the choice between Stax and Stripe boils down to the specific needs and scale of your business.

Bottom Line: Only consider Stax if you are doing $10,000+ in monthly volume (down to $5,000 might work, but not worth the switching cost). Otherwise, high-volume businesses will definitely save over the long term with Stax and it’s the best option for cost savings on fees. That said, Stripe still has the “adoption advantage” as it’s more commonly used, easier to find devs for, and integrates more cleanly with third-party apps.



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