Founded in 2010 in San Francisco and headquartered in Dublin, Stripe is an expense management software, API templates, and debit card provider. Its cloud-based platform allows businesses to receive and transfer domestic and international payments and manage and automate their day-to-day expenses.
While Stripe’s solutions are suitable for companies of all sizes across various industries, businesses defined as high-risk can get restricted or banned from using the company’s services.
Although the company has the right to prohibit particular businesses from using its services, you can dispute their decision if you prove you do not engage in dangerous work.
In the following sections, we’ll explore the types of businesses Stripe prohibits and restricts, what to do if your account is blocked, and how to avoid future bans.
Sections
Businesses That Are Prohibited and Restricted to Use Stripe
Stripe’s solutions are available to companies of all sizes in 46 countries. After subscribing to their solutions, businesses can start processing domestic and international payments.
Stripe categorises businesses by industry, such as gambling or illegal gaming, pseudo-pharmaceuticals, adult services and entertainment, marijuana production, etc. The company imposes restrictions and prohibitions on certain types of businesses and activities due to their potential for high fraud risk or subscriber and customer abuse.
Regardless of location, Stripe can prohibit or restrict a specific company from using its services based on the following criteria:
Shipping timeline: Stripe doesn’t allow companies with inadequate shipping timelines to use its services. Businesses that need an extended delivery time or have had negative customer reviews can be banned.
Profit mechanisms: Businesses that offer subscriptions with a suspicious no-cost trial period or billing are not allowed to use Stripe services. Stripe needs proof of fraudulent billing or inaccurate data about the free trial periods before it bans the account.
Suspicious financial and monetary records: Companies with suspicious financial records or those that have gone through periods of monetary (economic) instability can be banned.
Specific countries and locations: The company doesn’t allow individuals to open business accounts or use Stripe in particular places, such as countries or regions with an ongoing embargo, and doesn’t allow businesses to use money transfer gateways.
Money transfer frequency: Businesses with frequent and large money transfers can attract third-party breachers or fraud. Stripe can ban them if they notice frequent chargebacks.
Prohibited and Restricted Industry Niches
Illegal substances: Illicit businesses that sell or produce drugs, equipment for making drugs, or opiates that mimic specific drugs, such as the plant kava.
Illegal services: Companies that promote violence based on disability, ethnic origin, sexual orientation, religion, gender and race, telecommunication fraud, physical damage to individuals and properties, etc.
Identity-related: Businesses that offer identity-related services or false identification documents (IDs, passports, resident permits, etc.) and those that track and monitor individuals.
Adult-related content: Any type of adult-related content, such as sexual services, pornography, strip or topless clubs, AI-generated images and videos, escort services and gentlemen’s bards/clubs, various types of prostitution, online dating apps, cyberlocking, websites that offer fetish-related images, or real-time chats and videos, and similar adult-related services.
Money-owing services: Businesses that offer settlement, consolidation, or mediation services to help customers find a way to get out of debt.
Gambling: Online or in-person gambling, such as virtual casinos, auctions, sweepstakes, sports-related, video or board games tournaments, prize-winning competitions, biddings, etc.
Government-related services: Services or items sold in the name of consulates, embassies, or any other government-related misleading information about grants, unauthorised claims, etc.
IP rights infringement: Any intellectual property (IP) infringement, such as illegal redistribution or selling of videos, audio, images, etc. In addition, Stripe prohibits counterfeit services and items, cyberlockers, exported/and imported items, illegal brand selling, or any other type of trademark, copyright, and patent-related infringement.
Specific legal assistance: Legal aid on bails, bankruptcies, or law representatives and firms that collect money for illegal purposes.
Marijuana products: Reselling of marijuana products that contain THC or CBD (plant or edibles) percentage that is deemed illegal by the local laws and bylaws, educational lectures and courses on planting and cultivating marijuana, hydroponic tools for marijuana cultivation, etc.
Money credits: Loans, money credit and credit tracking, repairing, or any type of counselling on lending and money credit.
Nutraceuticals and illegal or pseudo-pharmaceuticals: Businesses that resell or promote weight decrease and sexual execution products and other types of unlawful pseudo-pharmaceuticals.
Illegal crypto-related services: The company prohibits any service that includes staking or mining cryptocurrencies, secondary non-fungible token sales, and coin offerings, also known as ICOs.
Travel: International or local cruises and airlines for commercial purposes.
Additional unlawful and illegal practices: Various acts forbidden by local or international laws, bylaws, and regulations, such as pyramid or marketing schemes, false documentation services, etc.
Firearms and illicit materials: All kinds of weapons or hazardous materials, such as weapons, ammunition, guns, pepper sprays, swords, pesticides, machetes, illegal chemicals, etc.
Restricted Ways of Using Stripe’s Solutions
Stripe prohibits businesses from using its expense management solutions if they:
- Use manipulated or false identity or business-related data.
- Provide misleading or false information about the type of business or industry niche in which they operate
- Facilitate payments and transactions in the name of another business or using their virtual (digital) terminals to manually add the cardholders’ data
- Process payments without having sold a service or a product
- Process payments for card testing
- Share data of Stripe cardholders with outside companies
- Redistribute Stripe’s IP without obtaining consent from the company. Businesses are not allowed to use their trademark, logo, or name if they do not have legal permission or do so in a harmful way that can damage the company’s reputation.
- Cross-sell goods and services without permission
Prohibited Locations
Stripe is allowed to ban accounts of businesses or citizens in specific countries or regions. The company will immediately freeze and ban your account if your business is registered in some of the following locations:
- Iran
- Syria
- North Kore
- Donetsk
- Cuba
- Crimea
- Luhansk
Stripe may also ban accounts of individuals or businesses listed on restricted entities lists maintained by the United Nations, UK, EU, USA (US Office of Foreign Assets Control and Denied Persons List or Entity List created by US Department of Commerce).
Restricted Ways of Using Stripe Issuing
Stripe Issuing allows Stripe subscribers to use API templates to create virtual (digital) or physical debit cards. While available to all Stripe subscribers, using them for the following activities is prohibited:
Third-party consumers: Strip Issuing cards can only be used by businesses, i.e. managers and staff members. Using the cards for private or household utilities is prohibited. You cannot use the business expense cards for domestic or international private payments since the cash available on the cards comes directly from your company’s budget. If Stripe notices unusual transactions for private purposes, they can immediately freeze your account.
Money lending: The tool should not be used to lend to third-party customers. Only businesses licensed to provide credit for other individuals or companies can use it for money-lending purposes. If authorised to do so, you must show proof when subscribing to Stripe.
Account abuse: Multiple account abuse methods of using Strip Issuing can cause permanent account bans, such as stealing free demo trials, reselling specific goods and services from another business, or getting involved in other illegal processes.
Laws and regulations non-compliance: In case your company is non-compliant with the rules applicable to your region (EU, US, or UK, respectively), you will receive a request from the company to change your policies and make sure your services are in line with the domestic or regional regulations. You can face a permanent account ban if you do not make the necessary changes within the requested period.
Card inactivity: Stripe can automatically delete your business account if you or your staff members are not using at least one of the debit cards within one year. You will receive a receipt of notification before the company closes your account.
Strip Issuing integration: Some businesses want to allow their customers to create physical and virtual (digital) debit cards using Stripe Issuing. For example, a company with a cloud-based platform can integrate Stripe Issuing so subscribers can reproduce multiple cards for staff members, marketing, or travel-related expenses.
If you’re interested in integrating Stripe Issuing, you must subscribe to the Stripe Connect plan. The company can freeze or permanently ban your account if you integrate Stripe Issuing into your cloud-based platform without subscribing to Stripe Connect beforehand. Contact customer support to learn more about the company’s rules for integrating Stripe Issuing.
Stripe Actions After Business Ban
There are multiple repercussions if Stripe decides to ban access or close your business account temporarily. They may disclose the specific reason why they banned your account, but they’re not legally obliged to do so.
Closing your business account will result in:
- No incoming or outgoing domestic or international money transfers
- No domestic or international payments
- No access to the remaining cash on your business account
If Stripe deems your business as illegal, they have an obligation to report it to MATCH (Mastercard Alert To Control High-risk Merchants) since Mastercard is one of their partners and leading card distributor. They might also report you to other databases that collect data on high-level risk businesses.
After reporting you to MATCH, there’s a high probability that your company will be prohibited from subscribing to other expense management providers.
Additionally, depending on the reason for the ban, you might have to pay extra penalties and customised rates.
Even in temporary cases, getting banned from using your Stripe account can lead to losing your company and going bankrupt.
Keep in mind that each case is subjective. Sometimes, the ban can last only weeks up to several months, but in some cases, it can be permanent. If there are any chargebacks, Stripe shall deduct them and retrieve them from the remaining cash in your account.
What to Do if Your Stripe Account Gets Blocked, Restricted or Declined
In specific cases, Stripe can decline and ban your business by deeming it high-risk even if it’s not. However, disputing their decision might be challenging.
The first thing you must do is make sure your business isn’t and hasn’t been involved in any illegal activities that can be found on this list.
In case your account has been temporarily banned, you should contact customer support via this link. You can also send an email and state your concerns. If the ban or freezing is a mistake, the company will restore the account within a short period.
If Stripe does not want to reactivate the existing account, you should inform all of your customers about the situation. To prevent losing many customers because of the ban, make sure to add a secondary money transfer/payment option, such as PayPal.
If you have relevant proof that your business and Stripe account are not connected to any illegal services, you should appeal and get in touch with the company’s customer service again. If the attempt is unsuccessful again, ask for legal support and advice from an expert legal team and proceed with the case with their assistance.
How To Proceed After Getting Banned By Stripe
If you cannot retrieve your Stripe account or the process is taking too long, you can open another merchant account and subscribe to the services offered by a company similar to Stripe.
Be aware that Stripe may report your business to high-risk databases, potentially affecting future applications.
However, if another service accepts your subscription application, you can proceed to create a checkout workflow using this guide created by Uscreen.
Best Practices to Avoid Getting Banned
To avoid getting your account frozen, prohibited, or banned by Stripe, consider trying some of the following best practices:
Write clear descriptions: Make sure your business’ products and services are described clearly and concisely. Keep track of all your product and service descriptions and, if necessary, update them, adjust the information, or delete the description.
You should also keep in mind that all of the data Stripe requires you to add to your account should be available for review by the company 24/7. Therefore, ensure you have all the necessary information and documentation to monitor your Stripe account.
Transparent website information: The content available on your website, such as terms and regulations or privacy rules and policies, should always be clear and transparent. If Stripe finds out some of the information on your website does not comply with their rules, they can temporarily freeze or entirely ban your account.
Correct bank data: Your bank data should be correct. In case any information on your bank account or cardholders’ data is incorrect, Stripe can temporarily prohibit access to your account.
Third-party breach security: To ensure no one uses your Stripe account for fraudulent payments, money transfers, and third-party breaches, use tools such as ChargebackStop or Stripe Radar. These tools can detect potential security breaches and fraud attempts 24/7 and notify you immediately.
Verification and security methods: Several types of security and verification options for payments are deemed high value. Usually, businesses use the following verification types to ensure none of their employees or third parties are misusing their Stripe account:
- Dual factor verification
- Advanced settings for third-party breach or fraud
- Money transfer authentication methods
- Money transfer daily, weekly, or monthly spending limits
- Mobile notifications and alerts
- Customer authentication via call
Chargeback monitoring and management: Chargebacks can happen anytime a cardholder orders something, gets their purchase, and notifies the service that they haven’t received the order. Some customers might even incorrectly claim they haven’t received their order in the way the delivery company described it.
That’s why you should monitor and manage all your chargeback requests as quickly as possible via Stripe’s dashboard. That way, you can keep track of all money retrieval operations and spot illegal chargebacks. By monitoring all chargebacks, you’ll avoid unwanted penalties to your business account.
Compliance with local laws and policies: Your business should comply with all of the laws and policies enforced in your region, such as regulations on financial data security. Additionally, your business should align with Stripe’s most recently updated policies.
Regular expense reviews: Keep track and monitor all your expenses to ensure no unlawful transactions. Also, always keep your financial and bookkeeping records sorted and ready for audit. If you are unsure how to do that, you can ask Stripe’s customer support for help sorting out your financial data.
Additional resources: To get acquainted with Stripe’s solutions and how to use them properly, go through their extensive archive of guides and educational resources, where you can also find the latest financial and expense management updates.