Stripe and Square have become household names in the world of online payment processing, providing millions of businesses with easy, fast, and secure ways to accept payments. However, the dark side of these payment giants often goes unnoticed, as they sometimes shut down businesses’ ability to accept payments, putting their livelihoods in jeopardy. In this blog, we’ll delve into why these shutdowns occur and discuss how online businesses can protect themselves.

Why Stripe and Square Shutdowns Happen

  1. High-Risk Industries: Stripe and Square have a list of restricted industries, including adult entertainment, CBD, e-cigarettes, and gambling. Businesses in these high-risk industries may find their accounts suddenly terminated, regardless of their compliance with regulations.
  2. Excessive Chargebacks: High chargeback rates can trigger a shutdown, as they increase the risk for payment processors. Chargebacks can result from fraudulent transactions, dissatisfied customers, or unclear refund policies, among other reasons.
  3. Fraudulent Activity: Stripe and Square actively monitor transactions for signs of fraud. If they detect suspicious activity or suspect that a business is engaging in illegal practices, they may shut down the business’s ability to accept payments.
  4. Policy Violations: Stripe and Square have strict terms of service that businesses must adhere to. Violating these terms can result in account termination.

The Impact of Shutdowns on Online Businesses

  1. Revenue Loss: When Stripe or Square shuts down a business’s ability to accept payments, the company loses its primary revenue source. This can lead to financial hardship, especially for smaller businesses with limited resources.
  2. Customer Distrust: Sudden shutdowns can damage a business’s reputation, as customers may perceive the inability to process payments as a sign of instability or untrustworthiness.
  3. Business Disruption: Businesses must scramble to find alternative payment processing solutions, which can be time-consuming and expensive, particularly for high-risk industries.

Protecting Your Online Business from Payment Processor Shutdowns

  1. Diversify Your Payment Solutions: Relying solely on Stripe or Square leaves your business vulnerable to sudden shutdowns. It’s wise to have multiple payment processing options, especially if your business operates in a high-risk industry.
  2. Monitor Chargeback Rates: Keep an eye on your chargeback rates and address any issues promptly. Implementing clear refund policies, providing excellent customer service, and using fraud detection tools can help minimize chargebacks.
  3. Adhere to Processor Policies: Familiarize yourself with Stripe and Square’s terms of service and ensure your business complies with their policies to reduce the risk of account termination.
  4. Consider High-Risk Merchant Account Providers: If your business operates in a high-risk industry, partnering with a payment processor that specializes in high-risk merchant accounts can provide more stability and peace of mind.


While Stripe and Square offer convenient payment processing solutions, businesses must be aware of the potential risks associated with relying on these payment giants. By diversifying payment solutions, monitoring chargeback rates, adhering to processor policies, and considering high-risk merchant account providers, online businesses can better protect themselves from the negative impacts of payment processor shutdowns.