Online Payments: Ultimate guide for startups

Starting a new company, need to receive payments online.

No worries,

In this article we are going to explore:

  1. Various online payment Gateways and
  2. their pros and cons, lastly
  3. Which one is should you go for, with regards to where you are:
  1. Canada
  2. USA

If you Live in Canada here are your options:

  1. Square (
  2. Flywire (
  3. Moneris (
  4. PayPal
  5. Stripe
  6. 2Checkout
  7. Shopify payments
  8. Amazon Payments (US only)
  9. TD Bank portal


Stripe is a payment processor made for startups and developers. They have  an excellent api and documentation. You can take one time payments organise subscriptions and have extensive reporting regarding payments.

Many Silicon valley startups such as lyft, instacart, taskrabbit etc use stripe for online payments.

Stripe also has many integrations such as:

  1. Docker
  2. Docusign
  3. Marin
  4. Tableau
  5. Hubspot
  6. splunk
  7. optimizely


Regarding fees stripe offers 2 plans:

  1. Pay as you go
  2. Enterprise

In pay-as-you-go Stripe charges 2.9% + c$0.30 per transaction. Payments arrive on a 7-day rolling basis. Plus if the customer is using an international card an additional fees of + 0.6% apply and if you provide international customers ability to pay in their home currency an additional fees of +2.0 % will apply. Volume discounts are also available if you earn more than c$50000 per month.

Stripe also comes with mobile sdk and Apple Pay:

Here are the full features of stripe:

Stripe features are categorised as

  1. Aceepting payments
  2. Process
  3. settle and reconcile
  4. manage

Accepting payments:

Pre-built UI components: Use Stripe’s pre-built UI components to design your own custom payment form.

Embeddable Checkout: Get a prebuilt embeddable checkout form to add to your website. With just a few lines of code you get pre-built checkout ready to serve customers.

Checkout Api’s: Create your own unique checkout experiences with Stripe.js Api’s.

Invoicing: You can also use Stripe to invoice US based customers, customise the invoices to match your custom branding, payment terms and accept cards as well as ACH payments.

Open source plugins: With a variety of plugins available for Stripe you are spoilt for choice. Here are some: 1. WordPress 2. Magento 3. WooCommerce etc

Payment Options

Cards: Cards from all over the world work with stripe including: VISA, MasterCard and American Express

Wallets: Stripe works with almost all the major Pay wallets. Here is the list:

  1. Apple Pay
  2. Ali Pay
  3. Google Pay
  4. WeChat Pay
  5. Visa Checkout
  6. Microsoft Pay
  7. MasterPass by Mastercard

Local Currencies : Process and display charges in customers local currency. Stripe supports currencies of 135 countries


Accept payments from iOS Android or mobile website, with Stripe mobile Api’s you require no backend changes and only a few lines of code:

Process Payments:

Stripe has a pre processing layer that lets business get closer to multi-regional direct connections to major card networks including Visa, Mastercard and American Express.

Here are the sub features for the Payment optimisations:

Retry Logic: automatically retries technical refusals through alternate means

Smart MCCL Automatically assigns Merchant Category Code according to your type of business for maximum auth rates

Updates Card Accounts: Automatically updates expired cards or renewed cards to reduce failure rates. Stripe does this by working with card networks to update customer card data.

Payments and Disputes: 

Stripe fraud prevention tools are best in business including a machine learning fraud prevention system, transpareant risk scores custom rules engine, real time fraud insights.

According to stripe statistics there is a 89% chance that a card has been used in the stripe ecosystem.

Stripe has to an extent also eliminated a lot of manual work related to handling disputes with their end-to-end automated process that works with card networks such as visa. They submit evidence that’s most likely to see the company win over the consumer.

Settle and reconcile:

Through Stripe API and Dashboard you get real time data

Through Stripe API and Dashboard you get real time data about charges, refunds and transfers.

Financial reporting: stripe gives advanced financial reporting capabilities, reconcile cash transactions with those recieved form cards and merchant gateways – every deposit in stripe is tagged with a transfer report containing  details of the transactions like at what time the transaction happened what were the fees involved etc.

You can also create monthly reports and transacton level balence breakdown stripe also has custom reporting via the API

Accounting support: You can automatically sync Stipe data with your accounting software ledger. or export stripe data into csv 


Stripe gives you a dashboard so that you can see the timing of the payout and the expected date you are going to receive them, you can also get unified payouts in your own curriencies from different cross border transactions. Or in select regions opt to receive money in different currencies.

Manage Payments

Get reports about consumer data with custom sql query support pre built queries and core metrics. Get mobile apps for consumer analytics as well.

Business operations

Give roles and permissions to employees keep sensitive data protected while allowing tailor made access to speacific employees.

High security 2 step authentication for login gives you peace of mind 

Also you can attach notes to payments for your team members to review.

Third party integrations:

Stripe offers a whole lot of third party integrations from accounting, analytics to email chat apps like Shopify slack iftt etc

Get 24 X 7 support via EMail phone and Chat


Paypal is another very popular alternative to receive payments online. You can receive payments via PayPal credit card and debit cards

Paypal offers fully customizable cart integration with receive, customers can pay without leaving your site you can even accept payments over the phone fax and email.

with paypal you can accept 25 currencies from 202 countries. PayPal offers two plans one normal PayPal with 2.9% + $0.30 fees and a pro plans that has access to api’s and other goodies with $35 per month and 2.9% + $0.30 per transaction.

PayPal offers Detailed order management you get logs, monthly statements and transaction history 

One unique feature that PayPal offers is the virtual terminal with it you can process phone orders, fax orders and mail orders around the globe.


2Checkout is another checkout that is widely used with support of 87 currencies and 15 languages you can accept debit cards credit API’s and even paypal.

2 checkout also offers api and integration with over 100 + shopping carts, you can also opt for hosted inline checkout experience with customers having the feeling that they are still on your site while making a payment. 

Or for complete custom experience use the API’s to built a interface for yourself.

With 2 Checkout you can have recurring billing advanced fraud protection and advanced analytics they even have a monetization platform called avangate.

2 Checkout charges 3.4% + c$0.45 per transaction plus an additional fee of 1.5% if the customer is from outside of Canada. 2 Checkout also charges an of 2-5% above daily bank exchange rates for customers outside of Canada.

If there is a chargeback 2Checkout also charges a fee of $25. In my opinion, 2 Checkout is one of the pricier options.


Moneris is Canada’s leading payment providers. Moneris offers both Hosted Pay Page as well as customizable API.

Moneris offers a variable fees across cards plus a flat fees +0.08% 

Moneris also offers 24/7 on call customer service. Although Moneris offers online payment options it is more of a onsite product, packed with many features to receive payments from cusotmers on site. 

Shopify payments

Shopify Payments

Shopify payments is the easiest way to pay if you are using Shopify already. Needless to say, it is seamlessly integrated into Shopify. Depending upon what Shopify account you have rates vary. For the basic account, you have 2.9% + c$0.30 for domestic cards for international cards you have 3.5% plus c$0.30 per transaction and it reduces as you go up.

you can see dashboard and payment analytics on the Shopify dashboard. Well, that’s basically it. If you are using Shopify you can opt for Shopify payments

TD bank portal 

TD bank is recognized all over Canada as a trusted bank and they also offer trusted merchant banking solutions with all the services that you need.

Virtual solution, Hosted solution and customised solution

TD also has all the standered features like online reporting etc


Square is a nice alternative to receive money online. It charges a fee of 2.9% + c$0.30 per transactions. One good thing about square is that you can get your money as soon as next working day. They also offer square dashboard and an iOS app to access real-time data and powerful analytics tools.

Square also has phone support if you run into any problems.

Square has APIs as well you can either integrate a pre-built square form or integrate it with your preexisting website with the help of apis

square also integrates with a lot of third party systems like CRM ERP and many other business and accounting solutions

Square also offers point of sale solutions such as accepting cards with mobile phoens and square swipe devices to accept credit and debit cards.


Flywire is another contender in the race to help businesses accept money. With customers such as Expedia, Hilton and Volvo, flywire also has a host of services on offer


  1. easily process international payments
  2. bill international customers in their own currencies with competitive exchange rates 
  3. Get automatic reconciliation of your invoices with many of the third party accounting systems
  4. Get a dashboard to monitor fund transfers online.
  5. Get 24/7 customer support available in multiple languages.

Hi, I am Mohammed full stack javascript developer with expertise in NodeJs angular react and Vue JS. Contact me for freelance work at [email protected]

Delaware LLC vs C – Corp

The Definitive Guide for Startups

So you are working on your new startup and you have your business plan , the money you are going to invest in your business and even figured out operations and marketing.

But some question remain.

What sort of business entity to form (LLC / C-corp/ S-corp) and where?

Many startups and VC funds favor Delaware to form a company.

In this article I will let you know:

  • What are the benefits of forming a company in Delaware?
  • What are the disadvantages of forming a company in Delaware?
  • Should you form an LLC or a C Corp or an S Corp? 
  • How can you form a company? What are the costs involved

Note: This is not a legal advice and I am not a lawyer, please consult your lawyer before taking any decisions.

Benefits of forming a company in Delaware

Delaware has a reputation for being liked by startups and Venture Capital funds for the following reasons:

  1. Corporate Law
  2. Privacy
  3. Startup costs
  4. Tax purposes
  5. Few formalities
  6. Easier to raise investments
  7. Structure

Corporate Law

Delaware has a special court of Chancery for law disputes and strong protections for companies that are incorporated in Delaware.

The outcome of cases in Delaware is more predictable because of the following reasons:

  1. A large volume of cases are recorded in Delaware hence there is a large base of precedents that can be looked into and hence there is less uncertainty if there is a case filed against your firm.
  2. Delaware special court of chancery has judges with corporate law backgrounds, hence cases are decided quickly and with justly as compared with courts where judgment is in the hands of ill experienced juries.
  3. As more than 60% of fortune 500 companies and a large number of private and public enterprises are incorporated in Delaware, more corporate attorneys are familiar with the Delaware laws and it’s more convenient to hire a lawyer.


You don’t have to name your shareholder’s officers and directors publicly. Only in the case of law enforcement you need to release these names. Hence it provides a layer of privacy.

Startup costs

There are minimal startup costs in Delaware. In Delaware, you can easily maintain an LLC with $300 in yearly costs and a C corp with $800 in approx yearly costs.

If you are forming a C corp. even a single person can perform multiple roles of the shareholder, officer, and director. In other states, you need at least 3 people.

Tax Purposes

Following are the tax benefits of incorporating the company in Delaware:

  1. There are no corporate taxes in Delaware if you do business in another state.
  2. There are no royalty payments or taxes on intangible assets such as patents.
  3. There are no taxes for non-resident individuals or entities (that is if you don’t reside in the forming a don’t do the business in Delaware you don’t need to pay income taxes, sales tax or any other kind of tax)


Many investors and Venture capitalists prefer Delaware because of they are familiar with the business laws hence it is easier to get an investment in your firm if you are registered in Delaware as compared to other places.

Disadvantages of forming a company in Delaware:

Drawbacks start when you are incorporating in Delaware and aren’t actually doing any business in Delaware. If you do that you will need to re-register the company as a foreign entity in the state in which you are actually doing the business.

Hence now you will have to do 2 filing instead of one and you also need to hire an agent and pay annual fees to them to pass on the legal notices and formalities for you.

Difference between an LLC s and a C – Corp

In Delaware and in fact anywhere in the United States, the most used types of corporations are LLCs and C-Corps.

What is an LLC?

An LLC is a type of company which is organized in an operating agreement.

An LLC is organized as a contract between members(owners) stating how it will be run and how the income and liability will be split between the memebers.

A few common characteristics of LLC:

They are designed to provide a corporate veil and a limited liability to the founders. That is moving liabilities, debts and obligations from the owners to the company to the company itself

LLC provides pass-through taxation that is generally the owners pay personal income taxes on the income earned by the business.

Formalities that are required by corporations such as board meetings, corporate resolutions directors issuing stock and drafting bylaws are eliminated. The LLC is governed by the contract between its partners, the contract itself is not required to be disclosed to the public hence it is easy to maintain and operate.

LLC can also be easily converted into a c corp. Converting a Delaware LLC to a Delaware corporation is straightforward and common enough that only a few forms are required to be filled to complete the process.

How to form a Delaware LLC: 

Forming a Delaware llc is quite easy you just require 2 things:

  1. Filing a certificate of formation
  2. Documenting your operating agreement

Before filling for the certificate of formation you must decide on a name for your firm and check for conflict with the Delaware Secretary of State. It can easily be done online.

Delaware does not require you to publicly release your name while filing for the certificate of formation, but you can include it if you wish to.

A certificate of formation must include:

  1. The name of the LLC
  2. The name and address of the registered agent
  3. The signature if the authorized individual

Delaware registered agent requirement:

You can form a Delaware LLC without visiting opening an office or maintaining a bank account in Delaware. However, the Delaware state act requires you to have an agent if you do not have an office in Delaware. You can hire one of the many agents available online just search for a Delaware registered agent, they charge anywhere between $120 to $300 per year and forward any document and legal stuff that the state sends you

Delaware C corp:

A corp is a full-blown corporation, they have shares and can also be listed publically and traded in the stock exchange

C corps are designed to be an abstraction between the operators of a business and owners of a business which may  or may not be operationally involved

Owners are called as shareholders and ownership is tracked by shares i.e more percentage of shares a person has. a more economic entitlement as well as the operational control they have over the company.

Characteristics of C-corp

Corporations are intended to provide limited liability to the shareholders. Shareholders are not liable for the debts and the of the company. If they have invested money in the company they can only lose the amount they have invested and nothing other than that

As a corporation, it is taxed separately from its owners i.e the shareholders. The corporations have extensive filing obligations, plus the shareholders are taxed again on their income.

Feasibility and suitability

LLC is the best choice if you wish to have a side project or have a bootstrapped company

LLCs are well suited for these companies because Intellectual property can easily go from members (owners) to LLC and vice versa plus there is minimal paperwork and hassle.

On the other hand C corporation requires a lot of ceremony for example s shareholder resolutions and meeting before Intellectual property can be transferred plus it is a big hassle, and time, as well as money, is required to run a C corp as compared to an LLC

International Owners

While the United States or Delaware does not impose any restrictions on citizenship or permanent residents for owning an LLC or a corporation. Owning a LLC for non residents noncitizen of the United States might

complicate the matters Non-resident owners of the  LLC in the United States are obligated to file income tax returns for income their LLC’s earn

For example, if a non-resident is an owner of an of an LLC in the United States. They will have to pay taxes in the United States for the income earned by the LLC and might have to pay taxes in the home country as well ( depending on the laws of the home country) thus resulting in double taxation.


Many venture capital firms and investor prefer c corps because the flexibility accorded with LLC require’s them to do extensive legal due diligence before investing and many do not prefer expensive legal work as a requirement to of in a company.

C corp is a corporation with standard laws and terms. So many investors prefer and require companies to be converted into C-corps before investing.

this article is written by Mohammed Lakkadshaw who is a javascript and Node JS developer. I am available for freelance work. I am neither attorney nor accountants, and this information should not the be considered either legal or accounting advice.

Tax loopholes while forming a Corp as a startup 

Thers is a lot of flxibility for planning your taxes in the c copr. A LLC will have to wait a few years to take advantage of tax benefits but an C copr can enjoy its benefits in the first year itselfd

These benefits are called as fringe benefits. What fringe benefits mensa that a company can give its employees benefits and deduct them as expenses for tax purposes.

The only condition is that the benefits must be for an array of employees not just the owners but if the only employees are owners, the owners can take benefit of this. these benefits can pay for health insurance or disability insurance of employees

In additionof owners pay themselves salaries, these salaries can be deducted from the c corps profits as running expenses plus c corp can retain earnings for future expansion as long as it complies with the appropriate tac provision s

C corp can deduct all business expenses such as cost of goods sold fringe benefits, salaries etc after all these, there is little income left to be taxed

C-corp also face lower taxes  on retained earnings  this is unique to C corps of the owners can use the tax savings to further expand their company