Your platform partners with Stripe for secure payments, and Stripe maintains an important responsibility within the financial ecosystem to protect its users and the businesses or consumers they serve. To do so, they must have a thorough understanding of each user’s business model, financial situation, and the potential credit risk of the business. This is done through a process called credit underwriting.
What can you expect during this process?
During the underwriting process, you can expect a review of your business model, billing practices, product usage, processing history, and financial stability, among other things. Your updated financial information will be requested, as well have questions about your recent processing history with other payment processors, if applicable.
How is credit risk generated?
Generally, businesses that take payments far in advance of delivery of goods and services pose a higher credit risk for payment processors. Additionally, the sheer volume of refunds or disputes based on the size of a user may also be associated with higher risk.
Given elevated levels of risk, users must demonstrate operational and financial strength to continue fulfilling their business obligations (e.g. delivery of goods or services purchased, refunds, disputes and associated fees).
What happens if the information requested is not available?
Based on certain internal criteria, your business may fall into a category that requires manual underwriting. When this is the case, your application will be assessed by an underwriter. Providing complete information in a timely manner helps ensure there are no unforeseen delays or unexpected risk mitigations that could impact your business.
If you are unable to provide the requested documentation or information, contact support as soon as possible. We would be happy to discuss with you what, if any, alternative information could be provided.
Will the information you share be handled confidentially and securely?
Data security and confidentiality are incredibly important. The information you share is intended solely for the purpose of underwriting and will be shared only on a need-to-know basis within the Stripe risk team.
Periodic account reviews
Stripe also conducts periodic account reviews of your business to ensure that it is in good health as it evolves over time. Reviews are a common practice in the financial services industry. The information collected during this process is used to confirm that Stripe has an accurate, up-to-date assessment of your business and helps protect all its users, as well as their customers.