I was recently having lunch in Skylon with a friend of mine who is also involved in software, and he mentioned that Stripe—a payment gateway—had now launched in the UK. A bit of light searching revealed a Wired article which asserts that Stripe’s co-founder wants to “redesign the world’s online payment structure to achieve one universal system”.
“… The internet has made it easy for people to communicate, but payment is still fractured. As a result the internet gets fractured as well. We don’t have this problem offline. The internet is a testament to a connected system that works—it’s a global network where any computer can reach another, and easily transfer information across.
“What if we designed payments for the internet? With interconnectivity and user experience as the goals. We’re designing from the groundup for the internet. We’ve not achieved it yet, but we expect more instruments will follow as Stripe spreads. The reason this problem is so important is that the web economy has so much growth left in it.”
The trouble is that this is simply not going to happen—not through Stripe, in any case.
Why? Well, just look at Section B5 of Stripe’s UK Terms and Conditions:
[B5] Prohibited Businesses
By registering for Stripe, you are confirming that you will not use the Service to accept payments in connection with the following businesses, business activities or business practices: (1) door-to-door sales, (2) offering substantial rebates or special incentives to the Cardholder subsequent to the original purchase, (3) negative response marketing, (4) engaging in deceptive marketing practices, (5) sharing Cardholder’s data with another merchant for payment of up-sell or cross-sell product or service, (6) evading Card Network’s chargeback monitoring programs, (7) engaging in any form of licensed or unlicensed aggregation or factoring, (8) airlines, (9) age verification, (10) age restricted products or services, (11) bail bonds, (12) bankruptcy lawyers, (13) bidding fee auctions, (14) collection agencies, (15) chain letters, (16) cheque cashing, wire transfers or money orders, (17) counterfeit goods, (18) currency exchanges or dealers, (19) embassies, foreign consulates or other foreign governments, (20) firms selling business opportunities, investment opportunities, mortgage consulting or reduction, credit counseling, repair or protection or real estate purchases with no money down, (21) credit card and identity theft protection, (22) cruise lines, (23) essay mills, (24) flea markets, (25) drug paraphernalia, (26) extended warranties, (27) fortune tellers, (28) “get rich quick” schemes; (29) gambling (including but not limited to lotteries, Internet gaming, contests, sweepstakes, or offering of prizes as an inducement to purchase goods or services), (30) sports forecasting or odds making, (31) illegal products or services, (32) mail-order brides, (33) marijuana dispensaries and related businesses, (34) money transmitters or money service businesses, (35) multi-level marketing or pyramid schemes, (36) online or other non-face-to-face pharmacies or pharmacy referral services, (37) prepaid phone cards, phone services or mobile phones, (38) pseudo pharmaceuticals, (39) quasi-cash or stored value, (40) securities brokers, (41) sexually-oriented or pornographic products or services, (42) shipping or forwarding brokers, (43) substances designed to mimic illegal drugs, (44) telemarketing, (45) telecommunications equipment and telephone sales, (46) timeshares, (47) travel agencies or travel clubs, (48) online or other non-face-to-face tobacco or e-cigarette sales, (49) weapons and munitions (50) virtual currency that can be monetised, re-sold or converted to physical or digital goods or services or otherwise exit the virtual world, (51) personal computer technical support, (52) selling video game or virtual world credits (unless you are the operator of the video game or virtual world), (53) selling social media activity, such as Twitter followers, Facebook likes or Youtube views, (54) human hair, fake hair or hair-extensions, (55) any product or service that infringes upon the copyright, trademark or trade secrets of any third party, or (56) any product, service or activity that is deceptive, unfair, predatory or prohibited by one or more Card Networks.
The vast majority of the businesses prohibited above are—assuming relevant registration and permits are obtained—totally legal and legitimate businesses.
As it happens, I was looking at Stripe in connection with a charity-related business that I am involved in. At first I was incredibly excited: Stripe seemed to offer all of the security and flexibility that we need—including OAuth integration.
Unfortunately, there is a gambling element to this business; and, even though the business has all of the required permits and clearances from the British government, Stripe’s Terms and Conditions mean that we cannot use their service.
Section B6 of the T&Cs covers illegal trading, which would surely be enough in most circumstances.
[B6] Business Conduct.
You will only accept payments through Stripe for transactions between you and your customer for the bona fide sale of lawful goods or services. You will not solicit or use a cardholder’s Card Data for any purpose other than to process payment for your goods and services. You will comply with all applicable laws, rules, regulations and orders of governments having jurisdiction in connection with your use of the Service.
One can only conclude, therefore, that Section B5 is something that Stripe have inserted to assert their own morality into their business model. Which is entirely fair enough: Stripe’s gaff, Stripe’s rules.
However, Collinson cannot make grand, sweeping statement about wanting to “redesign the world’s online payment structure to achieve one universal system” or opine that “we’re still waiting for [an integrated] payment tag, but rather than universal it’s still fractured” when Stripe itself is committed to preventing entirely legitimate—and heavily regulated—organisations doing business online.
Collinson goes on to say:
“Payment systems are holding back online progress. You still have to fill in 15 different fields, then get redirected to Verified [by Visa].”
Collison imagines a one-click world, where making use of any entrepreneurs’ product is as fluid, natural and as user-friendly an experience as the design itself, with little friction and more transactions.
It seems that, like many entrepreneurs, Collinson makes a good case for interconnectivity on one hand whilst, in fact, establishing business practices—based, presumably, on the personal morals of him or his investors—that stifle creativity on the other.
When we have a Stripe-like system that will encourage—or at least allow—any and all legal businesses use their service then we might actually get the universal payment system that Collinson says he desires.
Until that time, talk of wanting to “redesign the world’s online payment structure to achieve one universal system” remains so much hot air.