Stripe does not offer built-in payment plans, but you can create them using Stripe's tools and integrations
Stripe itself does not have a native "payment plan" feature that lets you set up installments directly in your Stripe dashboard. What Stripe does offer are the building blocks: a payments API, billing software, and connections to third-party services that handle the installment logic on top of Stripe's payment processing.
If you want to offer payment plans to your customers, you have three real routes: use Stripe Billing (Stripe's own subscription and recurring charge system), integrate a third-party payment plan provider that works with Stripe, or build the logic yourself using Stripe's API. Which one makes sense depends on how many plans you need, how much customization matters, and whether you want to manage the whole thing or hand it off.
Key Takeaways
- Stripe Billing lets you set up recurring charges and subscriptions, which can function as payment plans if you structure them that way, but it is designed for ongoing subscriptions rather than fixed-term installments.
- Third-party services like Sezzle, Affirm, Klarna, and Afterpay integrate with Stripe and handle payment plans themselves—Stripe just processes the payments they route to you.
- If you use Stripe's API directly, you can build custom payment plan logic, but you will need a developer and will be responsible for tracking installments, sending reminders, and handling failed charges.
- Payment plan providers typically take a percentage of the order value or charge the customer a fee, which reduces what you receive per transaction.
- Stripe's own tools do not charge extra for payment plan functionality—you pay only Stripe's standard processing fees on each charge.
Stripe Billing and how it handles recurring charges
Stripe Billing is Stripe's native tool for subscriptions and recurring payments. It lets you create a customer, attach a payment method, and schedule charges at intervals you define. You can set up a plan that charges $100 on day one, then $100 on day 30, then $100 on day 60—which is technically a payment plan, just structured as a subscription.
The catch is that Stripe Billing is built for subscriptions that continue indefinitely or until the customer cancels. If you want a fixed-term plan (three payments, then done), you have to set an end date manually or cancel the subscription after the final charge. It works, but the interface and logic are oriented toward "charge this customer forever" rather than "charge them four times and stop."
Stripe Billing charges you only Stripe's standard processing fee—2.9% plus $0.30 per transaction in the US, or your negotiated rate if you have a higher volume. There is no extra fee for setting up the recurring charges themselves.
Third-party payment plan providers that connect to Stripe
Services like Sezzle, Affirm, Klarna, and Afterpay are buy-now-pay-later (BNPL) platforms that integrate with Stripe. When a customer chooses one of these at checkout, the provider handles the installment plan—they charge the customer in installments and pay you (usually) the full amount upfront or within a few days. Stripe processes the payment from the provider to you, not from the customer directly.
These services take a cut. Sezzle and Afterpay typically charge merchants 2% to 8% of the order value, depending on the plan structure and your volume. Affirm and Klarna negotiate rates individually. The customer may also see a fee or interest charge, depending on the plan they choose, but that does not come out of your payout—it is between the customer and the provider.
The advantage is simplicity: you integrate once, the provider handles all the installment logic, reminders, and failed payment recovery. The disadvantage is cost and loss of control. You do not decide the terms; the provider does. And you do not own the customer relationship—the provider does.
Building custom payment plans with Stripe's API
If you want full control and do not want to pay a third party, you can use Stripe's API to build your own payment plan system. You create a customer record, store their payment method, and use the Charges API or Payment Intents API to charge them on a schedule you define. You handle the scheduling (usually with a background job or cron task), send the reminders, and decide what happens if a charge fails.
This approach costs you only Stripe's processing fees, but it requires a developer and ongoing maintenance. You are responsible for tracking which installments have been paid, which are pending, and which have failed. You have to decide whether to retry failed charges automatically, how many times, and when. You have to send payment reminders and handle customer disputes. Stripe provides the payment processing; you provide everything else.
Most small retailers do not build this themselves. It is cheaper and faster to use Stripe Billing or a third-party provider unless you have a very specific use case or very high volume that justifies the engineering cost.
Comparing costs across the three approaches
| Approach | Setup Cost | Per-Transaction Cost | Effort to Manage | Best For |
|---|---|---|---|---|
| Stripe Billing | None (built in) | 2.9% + $0.30 (standard Stripe fees) | Low—Stripe handles scheduling and retries | Subscriptions or straightforward fixed-term plans |
| Third-party BNPL (Sezzle, Afterpay, etc.) | Integration time only | 2% to 8% of order value + standard Stripe fees | Very low—provider handles everything | Retailers who want to offer BNPL without building it |
| Custom API build | Developer time (weeks to months) | 2.9% + $0.30 (standard Stripe fees) | High—you manage scheduling, retries, reminders | High-volume retailers with specific requirements |
What happens when a payment fails in a plan
If you use Stripe Billing, Stripe automatically retries failed charges. The default is to retry three times over several days, with increasing delays between attempts. You can customize the retry schedule in your Stripe dashboard. If all retries fail, Stripe marks the subscription as past due and stops charging.
If you use a third-party provider, they handle retries according to their own rules. If you build custom logic with the API, you decide the retry strategy entirely. Most retailers retry at least once, a few days after the initial failure, to account for temporary issues like insufficient funds or a card being temporarily blocked.
In all cases, you should send the customer a notification when a payment fails. Stripe Billing can send automatic emails; third-party providers usually do; custom builds require you to set this up yourself.
Stripe Connect and payment plans for marketplaces
If you run a marketplace where other sellers offer goods or services, and you want to let customers pay in installments, Stripe Connect (Stripe's platform-on-platform tool) works with Stripe Billing and some third-party providers. You can set up a payment plan that splits the proceeds between yourself and the seller, with Stripe handling the installment scheduling.
This is more complex than a straightforward payment plan because you have to manage both the installment schedule and the payout split. Most marketplaces use a third-party BNPL provider for simplicity, because the provider charges the customer and pays the marketplace the full amount upfront, and the marketplace then pays the seller. Stripe Connect is more useful if you want to keep the installment revenue and handle the split yourself.
Frequently Asked Questions
Can I offer payment plans without using Stripe Billing or a third party?
Yes, but you need a developer. You use Stripe's API to charge a customer's saved payment method on a schedule you define. You are responsible for the scheduling logic, retry logic, and customer communication. Most small retailers find this too much work and use Stripe Billing or a third-party provider instead.
Do payment plan providers charge me or the customer?
Both. The provider charges you (the merchant) a percentage of the order value—typically 2% to 8%. The customer may also see a fee or interest, depending on the plan they choose and the provider's terms. That customer fee goes to the provider, not to you.
Can I use Stripe Billing for a one-time three-payment plan?
Yes. You create a subscription with three billing cycles and then cancel it after the third charge. Stripe Billing is designed for ongoing subscriptions, so this is a workaround, but it works. You will need to cancel manually or use the API to cancel after the final charge.
What if a customer wants to pay off their plan early?
If you use Stripe Billing, you can manually cancel the subscription and charge the remaining balance when ready, or you can let the customer pay the remaining installments as scheduled. If you use a third-party provider, their terms control whether early payoff is allowed and whether there are penalties. If you build custom logic, you decide the policy.
Does Stripe charge extra to process payment plan payments?
No. Stripe charges its standard processing fee (2.9% plus $0.30 in the US, or your negotiated rate) on each charge, whether it is a one-time payment or part of a plan. Third-party providers charge their own fee on top of Stripe's fee.