Stripe moved more than $1 billion in payments to vendors onto its Global Payouts product by October, shortening setup times and reducing administrative work, the payments company said.
Setting up vendor payments in a new market took one week, down from as many as six, Stripe said. Its Oct. 30 blog post was titled “Stripe on Stripe: What we learned moving $1B in vendor payments to Global Payouts”.
The company examined its own migration, which began with testing in February and covered payments to more than 3,400 vendors in the United States and Britain by October. Stripe said its finance and treasury teams saved an estimated 20 to 30 hours a month through automated reporting and matching payments with records.
Payments maintained a 99.9% success rate, the company said. It did not give a comparable success rate for the previous system.
Stripe said it makes nearly 20,000 vendor payments annually across more than 70 markets. Previously, it connected banks directly to its enterprise resource planning system, software that manages business operations and financial records. Teams entered payments manually through bank websites wherever those connections were unavailable.
Each banking relationship brought separate technical, contractual and security requirements, the company said. Failed payments required operations and finance teams to search bank websites and internal records before sending the money again.
Stripe said it started testing with small US bank transfers in February, then began a rollout in four stages in March. It increased payment amounts only after nearly all eligible payments in the previous stage succeeded. By June, the product handled the vast majority of domestic US vendor payments by both number and value, the company said.
Incorrect or incomplete recipient information caused most payment failures during the migration, Stripe said. It moved checks earlier so its systems could validate information before sending money. Operations teams can now resolve most problems within minutes, the company said.
The migration also exposed gaps in information available to recipients, Stripe said. Vendors could receive money without being able to identify the sender or the invoice. The company added customizable descriptions to bank statements to help recipients identify payments.
Some vendor payments exceeded the product’s existing limits and required manual processing, Stripe said. It raised limits for US automated bank transfers and wires to $100 million, allowing more large payments to follow its automated approval and accounting processes.
Stripe said Global Payouts is generally available in the United States and Britain and supports recipients in more than 160 countries. The company said it is working to move more cross-border and foreign-currency vendor payments onto the product, including cases involving different countries for vendors’ addresses and banks.
