Should I use Stripe or Square for credit cards?
Many of you are wondering whether Stripe or Square is better for your Houfy business. This will depend on several factors and each owners' individual needs. I've compiled a summary of the differences I've learned about each. Keep in mind that each processor offers so many additional features (free and paid); I can't even begin to list them all. You can learn more details about those on their websites though. For now, I'll just cover the main points that relate to Houfy reservations.
What is the cost to signup?
FREE! Both Stripe and Square have no signup fees. No contracts. No termination fees. If you don't like them, cancel any time.
How quickly will I receive the guest payment?
Right away! Well, technically as soon as Square and Stripe deposit the funds into your bank account. Although both are payment options connected to Houfy, $$$ only passes between you and the guest.
You receive payments directly from the customer at the time of booking. This makes it easy for your guests to pay online at the same time they are making a reservation. No need to first accept the booking request, and then later send a separate payment invoice. This is the payout schedule for both companies:
Square: Within 1-2 business days, no matter which country the payment is coming from. This schedule applies to all Square account holders.
Stripe: Unless your business is considered to be a "high risk" industry, below are the general payout times. Note: the first payment may take between 7-10 business days.
Australia and U.S.: 2 business days
New Zealand: 4 days
Japan: once a week, day of your choice
Most other countries: 7 days.
Read more here about Stripe's payout schedules, and even how to customize your payout time. Note for Square: When your invoices are paid, you will be sent a daily deposit summary at 5 p.m. Pacific time (by default) - Unless you have customized your "close of day" time for a different hour. If for some reason you are not receiving these notifications, double check your settings. Log into dashboard, click "Account & Settings" icon. Scroll to "email notifications," and from there you can select which notifications you'd like to receive.
In which countries is this available?
Stripe: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Hong Kong, Ireland, Italy, Japan, Luxembourg, Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, United Kingdom, and the United States. Sign up here to receive notifications as new countries are added, or request an invite.
Square: U.S., United Kingdom, Japan, Canada, and Australia.
Note: U.S. territories are excluded.
How much are the credit card fees?
If you process over $250,000 annually, contact each company's sales dept. for a quote. Both companies accept all major credit cards: Visa, MasterCard, Discover, American Express, JCB, and UnionPay.
Online domestic invoices, Apple Pay, Google Pay: 2.9% plus .30 cents per transaction
International invoices: Same as above plus an additional 1% conversion fee, and a 1% international card fee may apply. Read about ways to avoid conversion fees. And read more details about other U.S. non-credit card payment methods.
European Cards: 1.4% plus .30 cents per transaction
Online invoices (including international): 2.9% plus .30 cents per transaction. Your customer may pay a conversion fee to their bank.
Read more details about in-person card payments and rates.
But I only accept payment by checks.
Some Houfy members (including Thijs) are having the guest make a small credit card deposit at the time of booking, then collecting the balance by check or transfer. This keeps fees to a minimum. It also prevents a guest from blocking your calendar while that check never arrives in the mail. And the guest has now put some $$$ down to secure the reservation. Here are instructions in setting that up.
At this time, the option to have guests pay by E-check or ACH debit is not available. Other Square users have requested this, and will update if/when I receive notice.
What about chargebacks?
Hopefully you'll never have a chargeback. But just in case, here is a quick overview:
Chargeback fee is $15. If you win the dispute, you are reimbursed the chargeback fee.
No fee if a customer files a chargeback, even if you lose the dispute. For those of you who receive a lot of transactions equaling $250 or less, you may benefit from their free chargeback protection program. Many home shares and one night stays will qualify. Transactions amounts over $250 do not qualify.
The protection program does come with some limitations. As long as the amount in dispute is no more than $250, you've followed Square's payment "best practices," and responded to the dispute sufficiently... you'll be covered up to $250 a month, even if the dispute is not ruled in your favor. This is not a month to month carry forward policy. Read more details about this program.
Can I accept payment while traveling abroad?
Yes. As long as you have Square or Stripe connected to Houfy, you are good to go! If you aren't connected, then you must read this section below about Square.
Stripe: You can generate invoices from any location.
Square: You can only process payments when you are physically located in the country where you activated your account. For in-person card payments using the Square app, your location is tracked by GPS. If you are sending invoices through your Square dashboard, then location is tracked by your IP address. When you connect to Houfy there shouldn't be any issues, as the cardholder entering payment info is considered to be generating the invoice rather than you.
How will refunds affect my cancellation policy?
It's important to consider your cancellation policy when choosing a processor. For those of you who have a NO refund policy, this likely won't affect you. However, the rest of you keep reading...especially if you offer guests a cancellation window!
Processing fees are reimbursed back to you when refunding guests. One caveat: the refund must take place within 120 days of the original transaction date. Outside of that time frame, you will need to process refunds outside of Square. So if you plan to accept a refundable damage deposit, be sure to not process this too far in advance.
Processing fees are not reimbursed back to your account when refunding guests. There is no time limit on applying a refund back to a guest's credit card; however, the more time that passes, the likelihood the card has expired, etc. Stripe recommends first contacting the guest (to see if anything has changed) if at least 6 months have passed. Payments that underwent currency conversion will be converted back during the refund process.
What if I need customer support?
Both companies offer online and phone support; however, you will need to sign up for a free account before you can receive phone assistance from either company. You can create a Square account by clicking on my referral link here. Both of us will save processing fees of $1,000 within the next 180 days. Note: You must click my link in order to save the fees. I made the mistake of having someone's link and signed up directly through the site; I lost out on the savings..ha!
When you call Square you will hear a recording asking for you to enter your customer code in order to access a phone representative. Log in to your Square dashboard and click here. You will now see your customer code and it will always remain the same. Keep it in a safe place as it identifies your account.
Square: Phone: 1-855-700-6000, Hours: 6 a.m. to 6 p.m Pacific Daylight Time
Stripe: No public phone number. They will call you immediately, but you first need to log into your dashboard to request a phone call. Hours: 24/7
After you create a free Stripe account, click on the "open book" icon in the top right corner.
There will be a drop down menu to select support. Scroll to the bottom and click on "contact us." From there you can choose to have a rep. call you. Fill out the short info and you will be presented 2 codes. One code is what the rep will repeat when they call you. The other code is for you to repeat back to the rep. It's usually very fast. I called 3x within the past few days and Stripe called me in about one minute.