If you're an Australian based SaaS business selling in USD and using Stripe, then you may be familiar with the following frustration.
Stripe won't pay USD in to a USD bank account unless the business is registered in the US. At least, this seems to be the current situation for Australian based Stripe customers.
Why is this such as frustration for Australian based businesses selling services in USD via Stripe?
If your SaaS business, like mine, earns money in USD, then has expenses in USD, then you're losing money on foreign transfer fees as well as (most likely) the forex rate every time you transfer money between currencies:
- Customers are paying for your services in USD via Stripe
- Stripe pays into your Australian bank account in AUD
- Then you spend money on other services in USD...
It's a scario deserving of a whiteboard animation, needless to say, each time your transferring money between currencies, you're being stung with currency exchange fees and arguably sub-market exchange rates.
Braintree, on the other hand, will pay USD into a NAB foreign currency account, reducing the inefficiencies of transacting in and out of AUD, particularly if you're paying international contractors in USD (as we do).
On top of a losing money from exchanging currencies, payment gateways also charge fees for international transactions. Looking at our Stripe reports, these fees aren't very transparent.
At the time of writing, LeadSync is a small SaaS business with an annual run rate of a little under around AU$200k. With the data we have, I've calculated our cost of transacting in and out of AUD to be around $500 per month. It's not huge money, but it's all relative. That's a 2-3% of annual revenue, or as I like to think of it, a return trip to London flying business class (if we ever get out of lockdown).
So if you're an Australian Startup looking to sell globally, carefully consider your payment gateway options.
Please Note: We haven't moved across to Braintree from Stripe... yet. But we are in the process of doing so. I'll post updates as we progress.