"Why Did Stripe Cut Me Off?" | Biz To Biz Podcast

Yo, what's up everybody? It's Justin live from B2B Vault, the Biz to Biz podcast sponsored by Nationwide Payment Systems, hosted by this guy, the Reggie Robey of payment processing himself, Allen Kopelman. And we'll be providing you educational information about fintech, small business payment processing, and the technology businesses are using in the world today. And in today's podcast, we'll be talking or answering a question, well, giving some answers to to a question, uh, why did Stripe cut me off? Why did they, you know, they— I no longer am able to process payments with Stripe. Um, there's a lot of different answers, um, but we'll try to cover them today. Anyway, how you doing, sir?

I'm doing okay. I missed you last week while you were out sick.

I missed you too, man.

Oh, glad you're feeling better.

You know, I mean I am healing. Uh, yeah dude, like the, the RSV thing or whatever, I call it upper air— it's the same thing.

Yeah, it's a—

it's an infection, upper respiratory infection, but RS, whatever that's going around down here.

Yeah, yo, yeah, my son was bothered with that too for—

it's like going a week, it's My wife is going on like week 3.

Yeah, he's had it for like 2 couple of weeks, but it was really bad and then it got— he got better and then— but it lingers.

Yeah, that's—

and I had the same thing.

I remember months ago. Yeah, I remember when you had lost my voice and it was— yeah, you were out of office for like almost 2 weeks.

Yeah, I was— well, you got— I came in and I was coughing.

You were going through me. Yeah, he was not— he was not being able to even talk.

Like, he threw me out of the office.

He said he came to the office like That's right, really bad.

I had to rest, like no talking, and that's hard for me. Yeah, because I get phone calls all day. I know, so it's, you know, it's a rough thing.

Yeah, so I've been healing, man, doing my herbal teas, and I finally went to the gym yesterday. Oh, did that feel good. I haven't been to the gym in like 2 weeks, so I, I hopped into the wedding.

We'll kind of— we'll get it out of you.

Yeah. I swam for about— I swam 10 laps yesterday, so I was coughing under the water.

Some people—

well, not like phlegm or anything, but I was like coughing and like, uh, so that people wouldn't freak out.

Don't tell people what gym you go to because they'll be like, oh, they need to clean the pool, like à la the movie Caddyshack.

Yeah, poop in the pool, man. Yeah. So anyway, so there's that. And thanks for everyone, for all your concerned people that checked in on me last week. I appreciate you guys. So, uh, why did you get shut down by Stripe?

So the main reason people get shut down by Stripe is they don't— Stripe has a link, we can post the link, it goes to the— it's the prohibited list. Yes, right. Their prohibited list is pretty long.

It's ridiculously long.

Okay. So if you are on there—

who's longer, PayPal or Stripe? I think Stripe.

Stripe has a pretty long list. PayPal's is about the same as Stripe, but they're a little bit more lenient. But it's— but it, but it, but it also, but it, but it also doesn't get into as much specifics, right, as Stripe does. Stripe really— PayPal, you could get shut off on PayPal. And then all of a sudden, and then they don't have to answer you. They don't have to tell you why. I believe that's wrong. Yeah. And the same thing with Stripe. They'll just send you a note. Oh, your account is under review. Sorry, we cannot process transactions for you any longer. And that's it. And then there's no phone number to call up.

No.

The thing is, is, you know, as long as you don't end up on the match list, it's a good thing. But we've been getting a lot of phone calls from people who got cut off by Stripe. There was even a recent article about how Stripe cut off businesses who were selling firearms. Is not allowed on Stripe, right? But companies that were selling firearm-related, related goods, right, right, right. So there was some guy selling like air rifle stuff for air rifles, firearms. Yeah, but he wasn't selling the air rifle, he was just selling accessories.

I know, but that's—

but he was selling like holster guns, holsters for guns, things like that. They shut the guy's merchant account down. He was processing for a couple of years there. All of a sudden, boom, you know, they changed their policy. Um, things like that.

I think changing the policies, one, right, right.

But I think that they should give people notice.

So like So I guess because when you're— when you're a small business, right?

Yeah.

And then you get accepted through Stripe, a lot of the time they're not doing their due diligence on your business.

No, they don't do their due diligence until you process. Right. Until you process your first transaction. Exactly. After you process your first transaction, then their underwriting goes into effect. They will send a note out.

Oh, you're— what's underwriting?

Underwriting is they're going to go review your website, right? If you don't have a website, they're probably going to shut you down because they're looking for some online presence of a business. Or if you don't have some sort of Google My Business page or a Facebook page or something, they're probably going to say no, you know, unless they can find us. You know, they want to verify there's an actual business. But their underwriting is after, you know, they accept you based on your credit. The federal tax ID number, they can verify the address, right? And then they say, okay, you're accepted. But then when you run a transaction, then they can go— they'll go, no, we don't want you anymore, right?

And it doesn't have to be the first transaction. You can be running processing payments for a really long time. And then, I mean, because I've had CBD websites running Stripe, right? And they were up and running for a really long time. All of a sudden who knows what happened, you know.

Yeah, they get a chargeback, can trigger it. Yes, a complaint can trigger it. A lot of different things can trigger them to review your website because maybe at one point they took CBD merchants, right, and then they stopped taking them. And then a lot of stuff's not— so you have lists like, oh, prohibited. Then there's restricted, you know. Restricted means we might process for you.

Right.

You know, and there's a difference between using, you know, PayPal, Stripe, and Square versus a merchant account. When you have a merchant account, you usually have a company to deal with or a representative or a consultant that's helping you. And then, you know, if there's an issue, you know, you're apprised of the issue. Like, for instance, we just had a client there in the travel industry. They were with— I don't want to name the processor, but they were with the processor. They had a little problem with chargebacks. They identified it, they fixed it, right? And then for whatever reason, the processor said, well, we don't want your account anymore. Here's 45 days notice, go, you know, you're out of here.

Bing bong.

So we had to go find them a new bank. They got approved in like one day.

I mean, it happened to Mike at Highly Edibles. They basically said like they don't want his company on there anymore, right?

He was processing for 2 years. Yeah, on another company who started with the letter H, and they, uh, and they basically said, oh, we don't want your business, here's a 10-day notice, you're out.

And they were talking about keeping his money for— yeah, holding his money.

They were talking about holding his money if he processed after the 10th day. This other merchant, we had the travel merchant, they got the same thing. So, you know, listen, it's, it's, it happens and, you know, you have to, you know, you know, so what are some other like, so like we talked about, um, change of policy.

Um, yeah, you sign up, do their due diligence because they don't care. They want any business just like that's why it's so seamless. The process is, oh, it's so simple and so easy. And then tomorrow you go run across your payment and you're not getting paid because you didn't look at their fine print and see if they even process your company type, your business type.

Right. Which I find unusual. You would think like during the application process you're going to put in travel, right?

Or something.

No, no. You're putting in I'm a travel company.

Yeah. I mean, like, how is there not like an AI tool on the back end of their website automatically? Like if there's like Just if there should be like keywords, CBD, cannabis, whatever, et cetera, et cetera, travel, health, you know, like those things. If it's that, then, you know, it automatically pushes you somewhere else.

Well, no, they just say, sorry, we don't accept this type of business.

Right, that's what I mean.

It's the same thing with Shopify, right? We have people that come to us all the time. Oh, I made a CBD website on Shopify.

No, you didn't.

Shopify. Doesn't process their transactions and wants to charge them extra.

Like, no, you didn't.

Don't make your CBD website on Shopify. But, you know, we had another merchant where I had a call today and it was a cruise business where they sell cruises. They got set up on Stripe. They ran one transaction and Stripe declined the, you know, accepted the transaction, refunded it automatically and told them No, we don't do this type of business.

What's, what's the type of business?

They sell cruises.

The guy that I was telling you about?

Yeah. Well, it was funny because I connected to him on— I connected to him on LinkedIn, but then also he somehow was also in our LinkedIn campaign. So it was a really weird intersection.

Nice.

That I intersected with the guy like good for two times.

Good.

And they, yeah, they got cut off. So now we're trying to find them a new bank, you know. And I said, yeah, it's on their, you know, it's on their list of prohibited business types. So, you know, you need to review, uh, the prohibited business type list when— wherever you're getting processing. So it doesn't matter if you're going to a merchant account company, Stripe, Square, PayPal, Shopify, you need to review their list. We had another merchant that built a Wix website, a Wix, a Wix website on health products and health. And they— Wix uses Stripe and health-related products. Nutraceuticals is on the prohibited list. So they have to pay an extra 60 basis points to stay to Wix to use outside processing.

That's insane. Why wouldn't you just get a different website?

They spent money making a Wix site.

You spent money on a Wix website?

Yeah, because they go to these developers.

I know these people out here that are doing—

man, I, I—

never mind. No, no, there's companies speaking of websites. So like, you know, like another thing is like these established businesses, you know, they'll be doing good and they'll be running their website and it'll be going well But then someone checks, someone from the underwriting says, you know, I want to review the website. It's been a couple months or whatever. And then they go to your website and you have no shipping and return policy, no privacy policy, no, uh, terms and conditions. You don't have an, uh, address to your business or phone numbers, phone numbers, emails. The NAP, you know, name, address, phone number.

No, you gotta have like checkboxes on your checkout page.

I agree to the terms and conditions. So those types of things, you know, people like business owners, they don't, you know, they're so busy running the business, but then, you know, then all of a sudden, yeah, you get your website is your processing is shut off.

I think we put a blog post out that goes over, you know, what needs to be on your website.

Um, I don't remember.

Yeah, it might have been a while ago.

I don't know. Okay, I'm sure there was—

we— but we've—

what else? We have a list on your website.

Yeah, we have like a list of things that we give to people whenever they come to us. It might be a startup company. Sometimes they get upset, they're like, oh, I'm processing on Square. Well, Square doesn't care.

A lot of times, dude, like these CBD companies, you know, they'll be fine, but then all of a sudden they'll put new products up there and they won't have the COA. Yeah, so it's like, dude, you can't, you can't try and fool or scam the, the, the, these companies because we have to go back and make sure that you're doing it because then, you know, it'll jeopardize our business opportunities in the long run, right?

Yeah, we don't want to send merchants to the bank and then the merchant is doing wrong things, shady stuff. You got to have the COA on there. And I know everybody's trying to sell everything You know, they're trying to do the business.

Under the sun.

You're trying to do your business, you know?

Yeah.

Like we recently had a company come to us that's a SaaS company. So they spent all their time, they integrated their SaaS product onto Stripe. So the way it works is, is I'm the SaaS company, right? I integrate it onto Stripe and then I sign up for Stripe's referral program. And then Justin comes and he buys my software.

Okay.

And then Justin wants to get a merchant account, so he clicks the affiliate link, he signs up with Stripe. And recently Stripe started declining a bunch of their customers and shutting them off.

Really?

Yeah. So they were like, why is, you know, why is that happening? And, you know, so we sat down with them and we reviewed what they were doing, you know, what they were doing and some of the companies that they signed up. Didn't have a website yet, and then some of them were selling, you know, the prices weren't on the website. It was like a lot of different stuff. You got to make sure—

consistent information.

Yeah, not— you got to be compliant. Compliant is, you know, all, you know, having all your policies on the website, your terms and conditions, you know, what Justin was talking about— name, address, phone number, you know. And also You know, you just— so that—

and, and also can't just be trying to fool everybody, man. You know, you can't be— everyone's trying to make a buck, and I know it's hard, right? Like everyone— it's—

well, a lot of people are trying to do like do these side hustle businesses.

That's what I mean.

Yeah, yeah. You know, because economy is bad, people need to make extra money. So like, okay, how can I start a side hustle, you know, and make an extra $1,000, $2,000 a month? Because You know, costs have gone up, right? So everybody's cost, you know, the cost of living has gone up and wages are only going to go so far. You know, wages can't go that— can't— are not going to exceed inflation.

We got— we got Allen stuttering over here, buddy.

Yeah, I don't like to get into all that, but I'm just saying that's what he knows.

Shit is real out here.

I know it's real, but I'm just saying the I'm just saying, that's what's fueling like the whole side hustle thing.

Oh yeah, I mean, I just recently re— I re-uh booted my, uh, web design company, man. So hopefully, uh, some— I need to— I need the money, man. I need some new sneakers, B.

No, so I'm just saying, so that's fueling a lot of these small businesses that are popping up now. That need to get credit card processing. And these, you know, the credit card processors have to make adjustments.

So I got a little— I got a question for you.

Okay.

So me and my wife, we've, we've been longing to start our own spices company, right? Okay. So we've, we've got our own. We have our own Sazon, adobo, um, taco seasoning, curry powder, barbecue seasoning, chili, and I got one— I can't remember what— a couple more. So do you think we should go rent, uh, like a ghost kitchen? No, no, no, just to package our goods. Or should we, or can we just do that in our home?

Well, I think, you know, to prove proof of concept, you know, you probably could mix some of that stuff up in your home, use that to make sure you have proper labeling on it. Oh yeah, no, no, no, no, no, no. You know what I'm saying? The labeling that—

because in my idea, what I wanted to do was like document it, right? Like, it's like a, you know, it's, it's our business, it's an at-home business, so It would be cool to do it like in a kitchen, right? Where it's all clean, stainless.

You can rent, you can rent, like usually you can rent a kitchen.

Yeah, no, there's a bunch of those. So I was asking, where do you think it would be cooler if we just like set up a little spot?

Well, it depends how much, you know, it depends how much licensing you want to go through. Because obviously you're going to have to go get a business license and all that. So you got, but you know, you just, you know, proof of concept would be, oh, make a bunch of this stuff and then somehow go out to the the farmers market on the weekend.

Absolutely.

And go sell it. I know a guy.

That's it. And then have the website for friends, family, and people who hear about it along the way.

Yeah, like I have a—

the idea is so like we can pay for the electric bill or something. Right. Like if we're only— we're not thinking like, oh, this is going to be the— we're going to be able to buy our 40 acres —an emu, a pig, a horse.

You want to make $1,000 a month, you don't want to— but because, you know, you're going to have expense. You got to make labels, you got to do all kinds of stuff. But, you know, it's simple. No, no, I know that.

I'm just saying that's all in-house.

Yeah, yeah, I get it. I'm just saying, as far as like, you know, testing, proof of concept, you can make a bunch of that up.

I mean, jars, pla— you know, it's all got to be glass because I'm eco, you know what I mean? It's got to be sustainable, you know what I mean?

That's where you might get into a little bit of— it's going to become—

the cost is going to be— that's where it's going to be hard because it's going to be all organic, you know. Anyway, so that's a whole nother side hustle. But no, my question is, where, where does that fall, like, under a merchant account?

No, you get a merchant account.

Like, you don't have to just food? What would that—

like, how— yeah, just a food. Yes, just selling food. That's it.

That's it. Okay, so it's not a—

that's like high risk, low risk, medium It's a medium because if you're shipping anytime you're shipping anything, got it. You know, you might start off saying like, oh, let's do card present sales, website with information on it only. And then once you start, because the thing is, is like you go to the idea of people going to like the, the farmers market is especially with a product like that, people buy it at the farmers market or get a free sample or something like that. And then they like it and then they want to get more. Do they want to go back to the farmer's market? Are you at the same farmer's market every week?

Definitely not. Or do they go—

then you got to have a way for them to go buy it off your website and ship it to them.

Yeah. I mean, we have enough kids to post up at multiple farmer's market on different locations throughout the city.

I had a friend of mine that was doing pickles. Great hustle. And then he, he was making pickles. He had like a little warehouse making pickles. And then he got a few people and they go to the different farmers markets and set up the pickles. And we were doing the processing for that. It's smart, man. Went out of business because there was no farmers markets for so long. Yeah, the guy didn't have a good e-com game, you know, got to be on that. And that's the, that's the thing, because he was putting it in like plastic things. You can't ship that. No, you know, it's a plastic thing, it's going to bust in the Shipping pickles was probably pretty tough. Well, no, not if it's in a jar.

What about vacuum seal?

Yeah, but I'm just saying he didn't have his e-com game. Yeah. You know? So, you know, you gotta, that's the whole thing. That's how you build up people to buy your stuff. I see it all the time. Like I've gone to the farmer's market and I see dog treats for Rocky, right? Then when I go back to the farmer's market again, let's say a couple months later, the person's not there. And then their website doesn't have e-com. So how can I get the treats again? Yeah, that's tough. So you want to have, you got to have that like ready, you got to have that plan like, oh, we sold a bunch at the farmer's market, people liked it, they came back again and bought it again. Now let's really, let's put this stuff on the, for you it's easy because you make the website yourself. Now let's get it on the website and sell it on a website. Right. And then you have card present and then, oh, people want to buy it. Oh, go to the website, buy it from the website. I think like people are into like, you know, food is a very big business. Coffee is a huge business. People like roasting coffee and stuff at home. And then— No, like just having like— Oh, you mean gourmet coffee roasters?

Yeah, yeah, right, right, right, right.

Where they make small batches of coffee. Like there's one that I buy every once in a while. Are people still distilling?

Like making their own moonshine and stuff. And I don't know about that. No, I was just wondering. I'm sure people— I don't know if that's a big thing back home. I'm sure people make—

like, you know, they sell kits for making liquor, making beer, I mean, stuff like that.

I— there's too many breweries for me. I— and plus, I'm not— I can't stand IPAs. And dude, give me a Guinness Draught draft.

But you know, like when you start a side hustle, you want to make you want to make sure, like we have a good product for side hustle businesses, right? You sign up, you can get, you can get, you can get, you can just use your phone without a, you can use your phone without even having equipment, but then you can link that same account up to your website. Indeed. Right, and that could be your, you know, that could be your side hustle credit card processing. So that's pretty easy to get set up.

And you're not getting kicked off of Stripe for doing that. But, you know.

Right, but Stripe doesn't have a card-present thing. I know they're introducing some machine, but you have to buy the machine. You don't have to buy it with us, you don't have to buy a machine.

You can download the app.

You download an app to your phone and you just use an app, there's no monthly fee. Boom, we can, you know, that's the side hustle.

You know, what are some, so quick recap, re-crap, recap. You get booted off of, Stripe for, you know, change of—

well, they changed their policy without notifying you. You're on the list of prohibited businesses, you're on a list of restricted businesses. So prohibited means they're not doing it, restricted means is they might do it if you met certain requirements.

And then if you mess up, bing, you're out of there.

And those are things to realize. That's 4. The other thing with Stripe is A lot of developers go to them and then put— list their product with, you know, have their customers getting accounts through Stripe, and then they find out that they're not meeting the minimum requirements from Stripe to get income from Stripe, or the income is very small. And recently, I think Stripe raised the minimum limit. So process— well, you have to process like whatever it is, $1 million or $2 million a month before you break— before they give you commission. Jeez. So a lot of— we're getting a lot of companies who want to say, hey, we want to leave Stripe for those reasons, and also for reasons where they're giving a lot of their merchants a hard time.

Besides that, you know, if you're selling something that's on— and, you know, you add stuff and you're not supposed to, you know, you got to make sure the information is there for, for Stripe.

Yeah, because every— because all these credit card processors, they, they all use things like G2 or or they use web scraping tools, or they use tools where they have like—

It's not like a physical person is sitting there like, oh, I'm gonna go to justinswebsite.com, right? Yeah. No, it's an artificial intelligence, it's a program or software, they're running through a database. Maybe they're auditing nothing but smoke shops today, right? They're gonna click enter and it's gonna, crawl every one of those websites throughout the day.

What it looks for is it looks for changes in the URL, changes in content. Exactly. But they have certain software that's actually monitoring your website 24/7, right? Security. A lot of processors are monitoring your content. So there's certain words you can't— yeah, they monitor. Yeah, they might— they use this thing, they use G2 is one. There's a couple of— one called Legit Scripts. There's, there's 4 or 5 different programs.

What would trigger, so like the processor, besides a transaction or a chargeback?

Let's say you were selling, like we have some clients that sell handbags and watches. Okay. So they put a new one on the website that wasn't there before and then the software will catch it. They'll send an email, hey Allen, Your client added a new product, we need to get the proof that they're allowed to resell because name brand products, we have to have proof that you're an authorized reseller of that. Got it. Or let's say somebody posts—

Okay, this is a good question. So a friend of mine, he has a bunch of those. He has like, he's working on his third sneaker resale shop. Right. But he uses like whatever. Yeah, I know. So what, what's a good option for him?

They can usually get approved. I mean, as long as it's disclosed that those are resells sneakers and they have a way to prove that those are the— not copies that the guy's selling. So that's where it gets into trouble.

Yeah, because he's, you know, there's times when he, you know, he's not like— no, no, I'm just saying that work for him, you know, they're not always super perfect and they might buy a fake Jordan or something. No, no, but I'm just saying that's That's where the rub comes in, is making— so that's why he has such a hard problem. He just takes cash and Venmo and Zelle and cash. He doesn't care, right? He doesn't have a cash register.

Yeah, because it's a problem. Because if you have— if you sold somebody something fake, you know, excuse me, there's a lot of legal issues with that.

He could use that. He should get one of those safe smart safes though.

Yeah, he should get a smart safe.

That would be a good idea for him if you're taking cash.

It takes a lot of cash.

I would have those designer sneakers.

Yeah, $5,000. I would definitely have a Smart Safe in my business, and that way you can put the money at the end of the day or a couple times a day into the Smart Safe, not even worry about it. Then they come pick it up every week, and your accountant— and your money goes into your bank account every day. Your accountant for a small fee.

So it's great. So don't get kicked off a Stripe, ladies and gentlemen. You know, read the terms and conditions on their website.

Yeah, don't waste your time applying First, read, read the terms and conditions, then apply. People call me all the time. Oh, I have this business. Can you accept that? Yes. Yep. We have different banks that we work with. We know what this bank will take, what they won't take. So then we place it where it will be accepted.

Yep. Well, that's today's podcast. That's why you would get kicked off of Stripe.

And if you need help, you got kicked off, call Justin or call me.

There you go, man. Nationwidepaymentssystems.com. Smash that subscribe button, like, comment, share, you know, let us know if we're doing a good job or not.

We appreciate all the listeners out there and ask us any questions that you want us to answer on the podcast.

Yep. Hi, Mom.

I love you. Peace out. Peace.