Stripe Fees in the United Kingdom

UK Stripe pricing in detail — 1.5% + 20p on European cards, 3.25% on non-European, plus Bacs Direct Debit, Klarna, Afterpay, and currency conversion. Worked examples for every UK merchant scenario.

At a glance

UK / European card
1.5% + 20p
Non-European card
3.25% + 20p
Bacs Direct Debit
1.0% (capped at £4)
Currency conversion
+2.0%
Klarna
5.4% + 20p
Settlement currency
GBP

UK merchants pay Stripe 1.5% + 20p on UK and European-issued cards — half the US rate. Non-European cards (US, Canada, Asia, etc.) are 3.25% + 20p. Bacs Direct Debit is 1% capped at £4. The settlement currency is GBP; charging in EUR or USD adds a 2% currency conversion fee.

Frequently asked questions

Are UK Stripe fees subject to VAT?
No — Stripe processing fees are exempt from UK VAT under the financial services exemption (Schedule 9, Group 5 of the VAT Act). You don’t charge or pay VAT on Stripe’s processing fees themselves. Stripe Tax (the tax-calculation product, charged at 0.5%) is also VAT-exempt as a financial service.
Why is the UK rate so much lower than the US rate?
Two reasons. First, EU/UK regulation caps interchange (the part of the fee paid to the card-issuing bank) at 0.2% for debit and 0.3% for credit on consumer cards — far lower than US interchange. Second, the European market is more competitive on processing margins. The 1.5% rate is unusual elsewhere; it’s essentially "interchange + small margin" baked into a flat number.
What counts as a "European" card for Stripe UK pricing?
EEA-issued cards (EU 27 + Iceland + Liechtenstein + Norway) plus the UK itself qualify for the 1.5% rate. American, Canadian, Australian, Asian — basically anything outside the EEA and UK — gets the 3.25% non-European rate, even if the customer is physically in the UK at time of purchase.
Should I take Bacs Direct Debit on Stripe?
For UK B2B subscriptions and any high-ticket recurring revenue: yes. At 1% capped at £4, a £500 monthly subscription via Bacs costs £4 — versus £7.70 on a UK card. The catch is Bacs has a longer onboarding (3–5 business days for first payment) and a 14-day customer dispute window. Worth it for predictable recurring revenue, less so for one-off transactions.
Does Stripe charge for instant payouts in the UK?
Yes — 1% of the payout amount with a £0.50 minimum. Standard payouts (T+2 to T+5 business days) are free. Instant Payouts arrive within 30 minutes to a UK bank account, useful for cash-flow-sensitive businesses.
How does Stripe handle Strong Customer Authentication (SCA / 3D Secure 2) in the UK?
Stripe handles SCA challenges automatically via 3D Secure 2 — no extra fee. Successful authentications result in liability shift (the card-issuing bank, not the merchant, is liable for fraudulent chargebacks). In the UK, SCA is mandatory for online card transactions over £30 unless an exemption applies.

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