How Canadian Businesses Can Reduce Stripe Fees

Running your Canadian business through Stripe makes sense - it just works. Who doesn't want that smooth checkout experience?

But here's one problem anyone used to the platform know: the FX fees eat into profits every single time you get paid in another currency. And for most Canadian businesses selling to US customers, that's happening a lot.

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Let's break it down:

• You make a sale in USD (awesome!)
• Stripe charges you 2.9% + C$0.30 processes it (ok, we’re used to that)
• Then bam - they hit you with extra 1-2% foreign exchange fee when you want your money

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Do the math on how much you lose each month just on these fees. 

That’s over 4.9% of your entire revenue that could be going straight into growing your business instead.

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Yes, Stripe simplifies checkout. But the fees just spoil the rhythm when you’re deep in the system.

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Ready to stop the fee drain? This guide will break down:

• The real cost of these fees (we did some math)
• Why this keeps happening 
• How to dodge these fees and handle cross-border payments
• Simple ways to keep more of what you earn

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Let's get into it. 

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Methodology

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All the numbers and facts here come straight from the source:

• Stripe's own docs 
• Bank of Canada rates
• Government data from Canada.ca
• Market research from eMarketer and NerdWallet

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Key Takeaways

• Stripe’s default payout system prioritizes convenience, but at the cost of flexibility and transparency for businesses handling USD revenue.
• Stripe charges a 1% foreign exchange fee on USD payouts to Canadian businesses, plus an undisclosed exchange rate markup.
• A business processing $100,000 USD/month loses $12,000 annually to Stripe’s FX fees.
• FX fees on refunds are non-refundable, adding more losses if you issue customer refunds or face disputes.
• ACH transfer bypass FX fees entirely, allowing businesses to receive USD payouts directly into a USD account with minimal transaction costs ($0–$3 per transfer).
• While they bypass FX fees, wire transfers are expensive ($20–$50 per transfer) and impractical for frequent payouts. ACH transfers are significantly more cost-effective.
• Loop provides USD accounts for Canadian businesses, enabling Stripe payouts in USD via ACH. 
• Services like Loop gives you full visibility and control over your money—with no FX fees, no hidden fees, no forced conversions, and no surprises.

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Stripe Fees Are Eating Into Your Profits

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Stripe charges a 2.9% + $0.30 fee per transaction for most credit card payments. But that’s not what we’re focused on today. For Canadian businesses receiving payments in USD, Stripe applies a 1% foreign exchange fee when converting USD revenue into CAD. 

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Here's an example of how it works;

• Your US based customer pays $1,000 USD for your product or service.
• Stripe deducts its standard 2.9% + $0.30 USD processing fee, leaving you with $970.70 USD.
• Stripe then converts the USD into CAD using an exchange rate that includes their 1% FX fee.
• The payout is deposited in CAD into your Canadian bank account.

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On the surface, it looks like you’re simply getting your money converted. But when you dig deeper, there are layers of hidden costs at play

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Here’s another scenario;

• You process $10,000 USD in customer payments over a week.
• After Stripe’s 2.9% transaction fee, you’re left with $9,710 USD.
• Stripe converts this to CAD at an exchange rate of 1 USD = 1.25 CAD, but they apply their 1% FX fee.some text
  • Without the fee: $9,710 USD × 1.25 = $12,137.50 CAD
  • After the fee: $12,137.50 − $121.37 = $12,016.13 CAD

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In this scenario, you’ve lost $121.37 CAD in FX fees for just one week’s worth of payouts. Over a year, this adds up significantly.

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For larger businesses with annual USD revenue in the millions, these fees can easily exceed $50,000 to $100,000 USD annually.

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Exchange Rates Can Also Work Against You

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Stripe’s FX fees don’t stop at the 1%. They also apply their own exchange rate, which often doesn’t match the mid-market rate. 

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This means you’re not just losing 1%—you’re also losing additional money to less favorable rates.

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But it doesn’t end there. Refunds and chargebacks add another layer of complexity:

• If you issue a refund, the amount is processed in the original transaction currency. But if exchange rates have changed, you could lose even more money.
• Stripe does not refund FX fees, meaning that even if you return a customer’s money, you don’t get back the fees you already paid.

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Canadian businesses are increasingly targeting US markets. In 2022, Canada exported over CAD 550 billion worth of goods and services to the US, accounting for more than 75% of Canada’s total exports.

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With e-commerce surging and cross-border trade becoming more digital, Canadian SMBs are processing more USD transactions than ever.

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Regulations and Industry Norms

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Stripe operates under Canadian payment regulations, but it’s still a US based company, which means their FX practices are tied to their global operations. 

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There are currently no specific Canadian regulations forcing transparency on FX markups in Stripe’s system. This allows them to bake extra costs into the conversion process without explicit disclosures on every transaction.Small businesses in Canada began to benefit from reduced credit card fees on October 19, 2024,  under a federal agreement championed by the Canadian Federation of Independent Business (CFIB).

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Businesses processing less than $300,000 in Visa or $175,000 in Mastercard sales see rates drop by 27%. However, Stripe has refused to adopt these changes, leaving merchants without relief.

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Why This Problem Demands Attention

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When you’re scaling your business, every dollar reinvested has a multiplier effect. That 1% FX fee is a recurring loss that compounds over time. Here’s how it adds up:

1. Less Capital for Expansion: For businesses eyeing the US market, FX fees take away resources that could have gone toward penetrating new customer segments.
2. Higher Cost of Goods Sold (COGS): Many Canadian businesses purchase inventory or services in USD. FX fees eat into the budget for these purchases, increasing operating expenses.
3. Reduced Pricing Flexibility: With slimmer margins, businesses are less equipped to compete on price, especially in the highly competitive US market.

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Cash Flow Gets Tight

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FX fees don’t just drain profits—they disrupt cash flow. Consider the timing:

• When Stripe applies FX fees, they’re deducted immediately during the payout process. This means you’re already losing money before it even reaches your bank account.
• For businesses relying on predictable cash flow to manage operations, these fees create unnecessary unpredictability.

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Competitiveness Takes a Hit

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In the US market, your competition is global. Businesses that find ways to eliminate unnecessary costs have the edge. 

While you’re paying an extra 1% on every payout, competitors who’ve optimized their payment processes are reinvesting that money to outpace you in marketing, product development, or pricing.

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Stripe’s Simplicity Comes at a Price

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Stripe’s payout model prioritizes simplicity, but simplicity comes at a price. Understanding how these fees work and their impact on your business is the first step toward managing them more effectively.

• Stripe doesn’t disclose the actual exchange rate they use for conversions. Instead, they bake their markup into the rate, meaning you could be losing more than 1% without even realizing it.
• Refunds and chargebacks amplify the problem, as FX fluctuations and non-refundable fees make it harder to recoup losses.

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As Canadian businesses increasingly expand into the US market, the reliance on platforms like Stripe grows. Recent industry data shows:

• Cross-border e-commerce sales between the US and Canada grew by 10.4% year-over-year in 2022. 

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Nearly half of Canadian small and medium-sized businesses sell to US customers, with the majority handling transactions in USD.

For Canadian e-commerce alone, cross-border sales are projected to surpass $104.77 billion  annually by 2025. 

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This means the scale of FX fees—and the profits lost to them—will only grow in the coming years.

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The Good News: You Can Keep Your Revenue in USD

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You don’t have to lose that 1% FX fee to Stripe. You don’t have to let your hard-earned USD revenue shrink before it even hits your account. Instead, you can take control by keeping your payouts in USD.

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Rather than letting Stripe handle the currency conversion and deposit your earnings in CAD, you can choose to receive your payouts in USD via an ACH transfer. 

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The USD account can be with a bank or a modern fintech service like Loop.

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This completely bypasses Stripe’s FX fees and gives you full control over how and when your funds are converted to CAD—or whether you even convert them at all.

• No More FX Fees: By choosing to receive your payouts in USD, you eliminate the 1% fee Stripe charges for currency conversion. That’s money back in your pocket.
• Control Over Currency Exchange: When you keep your revenue in USD, you decide when and how to exchange it. You can wait for favorable exchange rates or use cost-effective FX services to convert funds at a better rate than Stripe offers.
• Perfect for Cross-Border Expenses: If your business has expenses in USD—such as paying suppliers, freelancers, or subscriptions—you can use your USD revenue directly, avoiding conversion costs entirely.
• Improved Cash Flow Management: With predictable payouts in USD, your cash flow becomes more stable. No unexpected fees, no fluctuations caused by Stripe’s exchange rate, and more money to reinvest in your business.

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How Much Could You Save?

• If your business processes $10,000 USD in revenue per month, you’re saving $100 USD every month—that’s $1,200 USD annually.
• For businesses handling larger revenues, like $100,000 USD per month, the savings jump to $12,000 USD annually or more.

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Imagine what you could do with that extra cash—invest in marketing, hire new talent, upgrade your tools, or even expand into new markets.

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By choosing to keep your revenue in USD, you’re not just avoiding fees—you’re reclaiming control over your finances. It’s a simple, effective way to protect your profits and make smarter financial decisions.

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Why ACH Transfers Are Better for Your Business

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If you’re handling USD revenue, ACH transfers are the smarter way to get paid. They’re cost-effective, reliable, and give you more control over your money. Here’s why they matter:

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Lower Fees Mean Bigger Savings

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ACH transfers are one of the most affordable ways to move money.

• Stripe charges a 1% FX fee for USD-CAD conversions.
• Wire transfers can cost $20–$50 per transaction.
• ACH transfers? Just $0–$3 

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Keep Your Revenue in USD for Free

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With ACH transfers, your payouts stay in USD—no forced conversions, no hidden fees. This means:

• You decide when to convert your funds based on favorable exchange rates.
• Use USD directly for US expenses like advertising, suppliers, or subscriptions.

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Fast, Reliable, and Widely Accepted

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ACH transfers are the backbone of the US banking system, handling trillions of dollars every year.

• Payouts are processed in 1–3 business days, making them quick and predictable.
• It’s a trusted, secure method used by millions of businesses.

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Scale Without the Extra Costs

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As your business grows, ACH transfers save you even more. For example:

• A business processing $100,000 USD/month could save $12,000 CAD/year just by avoiding Stripe’s FX fees.
• Compared to wire transfers, you save an additional $2,000–$5,000 annually.

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ACH transfers give you control over your money. They cut out unnecessary fees, keep your revenue in USD, and help you save thousands every year. 

It’s not just a payment method—it’s a smarter way to grow your business.

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Meet Loop: A Simple Fix to Save Thousands For Free

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Since you’re tired of losing money to Stripe’s FX fees, it’s time to meet Loop—a Canadian fintech designed to help businesses like yours take control of their finances. 

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Loop offers a modern, no-hassle solution that lets you set up a USD account to receive Stripe payouts directly in USD.

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By working with Loop, you can bypass the foreign exchange fees and hidden costs that come with Stripe’s default payout process. Instead, you get:

• A USD account with local US banking details.
• Direct ACH payouts from Stripe into your USD account.
• Full control over when and how you convert your revenue to CAD.

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Here’s the difference:

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Loop makes it easy to stop the profit drain and start keeping what you’ve earned. With thousands of Canadian businesses already using Loop, it’s clear: this simple fix is a game-changer.

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Benefits Beyond Savings

When you choose to receive your payouts in USD through a platform like Loop, you're not just cutting costs—you're unlocking a suite of advantages that can propel your business forward.

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Enhanced Cash Flow Management

By maintaining your revenue in USD, you gain greater control over your cash flow. 

This flexibility allows you to strategically plan expenditures, manage liabilities, and invest in growth opportunities without the constraints imposed by automatic currency conversions.

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Competitive Edge in the US Market

Holding USD positions your business favorably when dealing with US clients and suppliers. 

It simplifies transactions, fosters stronger business relationships, and can even open doors to preferential pricing or terms, giving you a leg up on competitors who operate solely in CAD.

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Mitigated Currency Risk

Currency fluctuations can erode profit margins unexpectedly. 

By keeping funds in USD, you shield a portion of your revenue from adverse exchange rate movements, providing a natural hedge against currency risk and contributing to more stable financial forecasting.

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Streamlined Financial Operations

Platforms like Loop offer integrated financial tools that simplify multi-currency management. 

This streamlining reduces administrative burdens, minimizes errors, and allows your finance team to focus on strategic initiatives rather than manual currency conversions and reconciliations.

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Access to Advanced Financial Products

Utilizing services like Loop grants you access to financial products typically reserved for larger enterprises, such as multi-currency accounts, corporate cards, and tailored lending solutions. 

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These tools  enhance your operational capabilities and support your business's expansion efforts.

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In essence, the decision to receive payouts in USD is a strategic move that offers multifaceted benefits, positioning your business for sustained success and growth in an increasingly competitive marketplace.

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What You’ll Need to Get Started

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Getting started with receiving USD payouts is simpler than you think. The requirements are straightforward and you likely already have most of them in place. Here’s what you’ll need:

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A USD Account

First, you’ll need a dedicated USD account. This is the key to bypassing Stripe’s FX fees and keeping your revenue in its original currency. 

Platforms like Loop make it easy for Canadian businesses to open USD accounts quickly and securely. 

Unlike traditional banks, these accounts come with lower fees, seamless ACH compatibility, and tools tailored to small and medium-sized businesses.

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Your Stripe Account Details

To enable USD payouts, you’ll need access to your Stripe dashboard. Within the dashboard, you can update your payout settings to direct funds into your USD account. 

Stripe will continue to process payments as usual but will transfer the payouts in USD to your designated account instead of converting them to CAD.

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Basic Business Information

Setting up your USD account will require standard business documentation, such as your company’s registration details and proof of identity. 

These are standard requirements for compliance with financial regulations, ensuring your account is secure and legally compliant.

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An ACH-Compatible Financial Institution

To take full advantage of this setup, your USD account must support ACH transfers. ACH is the most cost-effective and reliable method for receiving payouts directly from Stripe in USD. 

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Loop specializes in ACH-compatible accounts, ensuring seamless integration with Stripe’s payout system.

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A Plan for Conversion or Spending

Once your funds are in USD, you’ll want to decide how to use them. You can:

• Convert the USD to CAD when exchange rates are favorable.
• Spend the USD directly on US expenses like suppliers, subscriptions, or advertising.
• Hold onto the USD as a hedge against future currency fluctuations.

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The beauty of this setup is that you’re in control. No forced conversions. No hidden fees. Just flexibility and savings.

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Setting Up Loop is Quick

Getting started with Loop is fast, easy, and hassle-free. You’ll be up and running in no time, keeping more of your revenue right where it belongs.

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Step 1: Create Your Loop Account

Visit bankonloop.com to sign up for a USD account. The process is completely online and designed for speed. 

All you need is your business information, and you’ll have your account ready to go in minutes. No long forms, no in-person visits—just modern banking built for Canadian businesses like yours.

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Step 2: Verify Your Business Details

To comply with Canadian financial regulations, Loop requires standard verification documents. 

Upload your business registration and identification documents securely within the platform. It’s quick and ensures your account is protected.

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Step 3: Add Your USD Account to Stripe

Log in to your Stripe dashboard and navigate to the payout settings. 

Replace your existing CAD bank details with the new USD account information provided by Loop. 

Once updated, Stripe will begin depositing your USD payouts directly into your Loop account via ACH.

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Step 4: Start Saving

With your Loop account live and linked to Stripe, you’ll instantly stop paying Stripe’s 1% FX fee on every payout. 

The money you save can now go toward growing your business instead of covering unnecessary costs.

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Don’t Leave Money on The Table

It’s time to make a change that saves you money and simplifies your financial management. Join thousands of Canadian businesses already benefiting from Loop.

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Get started now and start keeping more of what you earn.

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Common Questions Answered

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Will this affect my customers?

No, your customers won’t notice any changes. Stripe will continue processing their payments as usual, regardless of whether you choose USD or CAD payouts.

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What happens to my CAD revenue?

Any payments made in CAD will continue to be deposited into your CAD account. Only USD payouts will be sent to your Loop USD account.

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How do I transfer USD funds to my Canadian bank?

You can convert and transfer your USD funds to your Canadian bank account at any time through the Loop platform.

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Is there a fee for receiving USD payouts through Loop?

No, there are no FX fees for receiving USD payouts. ACH transfers to your Loop account are either free or have minimal transaction costs.

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Can I use the USD funds directly?

Yes, you can use your USD balance to pay for US expenses like suppliers, subscriptions, or advertising without converting to CAD.

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How long does it take to set this up?

Setting up your Loop account and linking it to Stripe takes just a few minutes. Most accounts are approved within a day.

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Does this work with other payment platforms?

Yes, your Loop USD account can receive payouts from other platforms like PayPal, Amazon, or any service that supports ACH transfers.

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