Managed Risk

Managed Risk allows platforms to assign end-to-end connected account risk operations to Stripe, including responsibility for unrecoverable negative connected account balances. With Managed Risk, Stripe continuously monitors and mitigates credit and fraud risk.

Managed Risk features

Managed Risk provides the following features:

• Screening at onboarding: Stripe runs risk-based onboarding checks to verify compliance and identify fraud and credit risk before an account starts processing payments.
• Ongoing risk monitoring and mitigation: Stripe continually monitors risk signals to identify connected accounts that pose credit or fraud risk. In some cases, Stripe might take action to reduce risk exposure.
• Risk operations and support: Stripe handles risk reviews and works directly with connected accounts to resolve issues. In most cases, the platform doesn’t take any action.
• Negative balance liability: Stripe assumes liability for unrecoverable negative balances on connected accounts. Your platform is only responsible for covering its own balances.
• Managed Risk visibility: You can view Stripe’s risk assessments, interventions, and connected account actions in your platform Dashboard.

Set up Managed Risk

Stripe automatically implements Managed Risk for connected accounts that meet the requirements. To use it, build your integration with the following options:

• Assign responsibility for negative balances to Stripe: If you use Accounts v2, set defaults.responsibilities.losses_collector to stripe. If you use Accounts v1, set controller.losses.payments to stripe.
• Request the card_payments capability for connected accounts.
• Configure compatible payments: Direct charges are automatically compatible with Managed Risk. For indirect charges:
  • Destination charges with on_behalf_of set are in private preview. To request access, contact Stripe Support. Private preview
  • Other types of indirect charges aren’t compatible with Managed Risk. If you’re interested in using them, contact Stripe Support and we’ll let you know if and when they become available.
• Use compatible onboarding: Onboard connected accounts using a supported flow:
  • Stripe-hosted or embedded onboarding are automatically compatible with Managed Risk. You can use the Accounts API to prefill data you’ve already collected.
  • Using API-based onboarding with Managed Risk is in private preview. If you build your own API onboarding flow, you must use the full Stripe Service Agreement. Private preview
• Provide connected accounts with a way to resolve interventions: Use one of the following options:
  • Provide access to the full Stripe Dashboard.
  • Provide access to the Express Dashboard.
  • Provide a custom interface that includes both the Notification Banner and Account Management embedded components, as well as components that allow accounts to add funds and respond to disputes.
  • If using API-based Managed Risk, provide a custom interface that informs connected accounts of interventions and allows them to respond. Private preview
• Use Stripe Radar: Enable Radar for your connected accounts.
• Treasury for platforms: If you use Treasury for platforms, you must enable Prebuilt embedded finance. Private preview

When using Managed Risk, you can customize your connected account interface and onboarding flow, subject to certain restrictions. For example, if you provide a Stripe-hosted Dashboard, you can’t remove the ability for a connected account to manage disputes.

Connected account onboarding flow

You can onboard connected accounts using any of the following methods:

• Stripe-hosted onboarding
• Embedded onboarding component.
• Stripe APIs

In all cases, Stripe collects the required information for risk management. You can also prefill any information that you’ve previously collected in your onboarding flow using the Accounts API, even if you use the hosted or embedded onboarding options.

How connected accounts interact with Managed Risk

For most connected accounts, Managed Risk operates in the background, rarely requiring direct interaction with Stripe. If Stripe needs additional information, or takes a risk-related action, we notify the connected account and provide clear steps to resolve the issue.

To resolve an intervention, a connected account owner might provide additional KYC information, complete a form, or provide other documentation. Stripe reviews their response to assess whether to lift, revise, or continue the intervention.

Risk monitoring and mitigation

Stripe continually monitors risk signals (KYC, transaction data, and so on) to identify connected accounts that might pose credit or fraud risks. We use both automated processes (AI models) and manual Risk team reviews. We might respond to certain signals (such as elevated losses, spikes in chargeback rates, or refunds) by taking targeted action to reduce risk exposure, possibly including:

• Changing capabilities: Stripe might slow or pause payouts, or pause the connected account’s ability to process charges.
• Holding reserve funds: Stripe might hold a reserve on the connected account’s balance, either a fixed amount or a percentage of transaction amounts.
• Offboarding: In the extreme case that a business poses significant risk, Stripe might deactivate the connected account.

Fees for Managed Risk

The fees for Managed Risk depend on the economic model:

• Revenue share: For connected accounts where the platform uses a revenue share economic model for payments processing or Treasury, including Standard accounts, we include Managed Risk at no additional cost.
• Buy rate: For connected accounts where the platform uses a buy-rate economic model, Managed Risk fees depend on the pricing arrangements:
  • Listed pricing: For platforms that pay listed pricing for payments processing and Connect fees, we include Managed Risk at no additional cost.
  • Negotiated pricing: For platforms with negotiated pricing for either payments processing or Connect fees, Managed Risk incurs additional fees. For more information, contact Stripe Sales.