Stripe has emerged as one of the fastest-growing payment service providers (PSPs) in Asia-Pacific (APAC), expanding its footprint both geographically and through its broadening suite of financial products. A report by S&P Global Market Intelligence (S&P), sponsored by Stripe, explores this growth, highlighting Stripe’s expansion strategy and value propositions across the region.
Founded in 2010, Stripe is an Irish-American multinational financial services and software-as-a-service (SaaS) company with dual headquarters in South San Francisco, USA, and Dublin, Ireland. The company provides a comprehensive suite of payment processing tools and application programming interfaces (APIs) that enable businesses to accept online payment securely and efficiently. It also offers tools for billing, fraud prevention, and financial reporting to help businesses manage their finances more effectively.
Stripe entered APAC back in 2014 when it launched in Australia. Since then, the firm has grown to serve at least eight markets, supporting local merchants across Australia, New Zealand, Hong Kong, Japan, Malaysia, Singapore, Thailand and India, and delivering them with nearly all its features, with the exception of embedded finance.
In August 2024, Stripe entered a new market, allowing US merchants to accept payments from South Korean customers.
Stripe is also preparing for further expansion. In Indonesia, it is currently available as an invite-only program but plans to officially launch later this year by integrating local payment methods.
Plans are also underway to launch in the Philippines, according to S&P, a market which Stripe has been eyeing for several years. Notably, it led a US$12 million Series A into PayMongo, a local online payment platform, back in 2020.
Stripe’s growth in APAC has been accompanied by significant customer growth. In 2023, the number of Asian businesses processing over US$1 million annually on Stripe grew by 28% year-on-year (YoY). The company claims that hundreds of businesses in the region are going live on Stripe every day, more than double the rate in 2020.
Stripe’s APAC market expansion strategy
The S&P report also looks at Stripe’s market expansion strategy in APAC. It notes that typically, Stripe starts by supporting US-based and international merchants with cross-border trade. It would then expand into supporting local merchants by allowing them to accept payments both domestically and internationally.
Another facet of Stripe’s expansion strategy involves gradually rolling out the broader suite of products it offers in the US, such as Billing and Subscriptions, in selected APAC markets. Here, Stripe focuses on balancing growth with the need for product-market fit.
For example, Stripe’s Terminal-driven omnichannel proposition is currently limited to four markets in APAC, including Australia and Singapore, which are card-friendly markets. In these markets, the product is meeting internal targets, reflecting market relevance.
Addressing local demand and needs
Recently, Stripe has placed increased emphasis on optimizing its checkout suite. This suite combines prebuilt forms and embeddable components with a wide range of payment methods, faster checkout options and customization controls.
In APAC, Stripe supports over 100 payment methods to meet rising demand for domestic card brands, e-wallets, instant payments, modernized direct debits, and other bank transfers. This broad coverage is made possible through direct acquiring and partnerships with local providers. It aims to help global merchants present the most relevant payment options to consumers, and enhance the checkout experience.
In South Korea, for example, e-commerce usage is spread across multiple payment methods. Hence, Stripe has chosen to work with NICEPay, a domestic provider offering an all-in-one online payment solution. This partnership gives buyers in South Korea a fully localized payment experience, while providing US entities with access to one of the strongest e-commerce markets worldwide without the need to set up a local entity. It includes more than 20 card brands, four local wallets, and end-to-end settlement and reporting.
In Malaysia, Stripe has registered with PayNet as a third-party acquirer to offer FPX, a popular e-commerce payment method using bank credentials. PayNet is Malaysia’s domestic payment network.
A focus on enterprises
Stripe has also increased its focus on large companies. By offering flexible checkout tools that integrate with third-party processors, Stripe aims to retain key enterprise customers and enable seamless integration within a multi-PSP ecosystem.
This approach also allows Stripe to tap into new markets and expand without requiring full adoption of its product suite, positioning it to better meet the region’s diverse demands while growing its presence.
So far, Stripe’s strategy has paid off, allowing it to expand its enterprise and platform client list to include notable names like LG Electronics, M1 and TADA in Singapore; Scentre Group, Atlassian and Xero in Australia; and Toyota Motor, Nikkei, ANA Group, Tokyu, Morisawa and ORIX in Japan.
Strong growth but rising costs
In 2023, Stripe International, which encompasses the firm’s operations in Europe, APAC and the Middle East, saw its combined net assets increase by a remarkable 50% YoY to US$930 million, according to an analysis by FXC Intelligence, a financial data company specializing in payments and e-commerce.
However, the company’s pre-tax losses also saw a very significant surge. Losses climbed sharply by 537% YoY to reach an all-time high of US$1.2 billion in 2023, representing almost four times the combined losses of the five previous years combined.
This spike in losses was largely due to a surge in share-based payments following a deal that allowed employees to cash out around US$1 billion of stock options. As a result, staff costs more than doubled, and the average cost per employee soared.
Besides staff expenses, cost of sales was another major driver of overall losses. This increased 71% YoY to nearly US$4 billion, slightly exceeding the revenue. Administrative costs also grew, influenced by factors driven by foreign exchange (FX) losses, depreciation, and partner fees.
Despite these losses, Stripe Inc., the main US-based parent company of Stripe, became cashflow positive in 2023. Stripe is valued at a staggering US$70 billion, making it the fourth most valued private tech company in the world, according to CB Insights.
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