How to Register Dropshipping Business in the US and Get Credit Card Payments with Stripe!

When you start your drop shipping business and work on the store design and development, you need to be really careful about the payment options you offer.

It is important that your customers can easily pay for their purchases. Wherever they live, they should be able to make an online payment. That’s why you must include all the necessary payment options in your store.

How can your store visitors pay for their orders?

Generally speaking, if your dropshipping store has a global reach, you must integrate two payment options into it:

  • Payment via credit cards;
  • Payment via PayPal.

If you target some specific geographic region, you can also use some local payment systems that work on this separate territory. But if you are not limited with a certain region and want to target customers all over the globe, it is best to use both credit card and PayPal payment systems.

As to our own dropshipping experience, nearly 50% of our buyers pay for their orders via credit cards. If your dropshipping store doesn’t accept payments made through credit cards, you lose up to 50% of your potential profit.

Not that great, eh?

What is more, there are countries where PayPal payments are not available at all! It means that credit cards payment is the only possible option for people on these territories.

It means that you must do your best to integrate a credit card payment system into your dropshipping store if you want to work with your customers all over the globe without any troubles.

Integrating credit card payment systems into your dropshipping store

There are various solutions that can be used in your online store for processing credit card payments. But their functionality varies a lot for different countries.

For example, we know that there are countries where local laws oblige store owners to show the total bill on checkout page in local currency only. It seriously limits the choice of suitable credit card processors.

This is why for our own dropshipping stores, we decided to work with some of the payment processing companies from abroad.

If you use these systems, for example, Authorize, 2checkout, Stripe, etc., your store gets an option of taking credit card payments, which is great both for you and for your customers.

Still, these systems are also tricky.

For example, there is a system called 2checkout. Anyone from anywhere on the globe can register in it, even a private individual without an officially established company.

But 2checkout has some really strict regulations. The company staff looks into your store in detail, and pays attention to EVERYTHING. Are you trying to sell branded items? Does the contact information match the contact details you provided upon registering? Does your business niche have a high risk of refunds? These and many other issues are carefully viewed, and your application can easily be denied.At first, 2checkout didn’t even accept registration applications from dropshipping stores as the company didn’t trust them enough. Now the situation is a bit different – 2checkout is more tolerant to dropshipping business. In the end of 2016, they made a statement they are now supporting AliExpress dropshipping stores.

We have tested 2checkout on several dropshipping stores we have, but for some reasons it wasn’t really convenient. Instead, we preferred a system called Stripe, because:

  • It’s much quicker to register in Stripe;
  • Stripe is more convenient from the technical point of view;
  • You pay much lower fees;
  • You can get cash payments much sooner.

What is Stripe and how does it work?

Stripe is a very popular and advanced technical solution. It is a payment processing system that lets you accept credit cards on your sites.

Using Stripe, you can allow your buyers place an order and make a payment via a credit card directly on your website. They are not transferred to any other websites, so they quickly and easily make an on-site payment. It doesn’t matter what is the country where your customers live.

Stripe views your application automatically, so the registration process is much simpler than with 2checkout. They don’t ask you any additional questions, so you will definitely get your registration.

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The problem, again, is the country where you are based and where your bank account is registered. Unfortunately, Stripe is currently not supported in most of the countries and is only available in the USA and a number of other countries.

So, if you are not a resident of one of these countries and do not have a local bank account, technically you can’t use Stripe service.

But even if you live outside this region and Stripe does not provide its services in your country, there’s still a way out. You can register dropshipping business in any of the countries where Stripe works, and get an access to it. We decided we will register our business in the USA because it’s much easier than in other countries supported by Stripe.

To put it simply, there’s the whole process for those who lives outside the US:

  1. Your client makes a purchase from your dropshipping store and pays for his order with a credit card;
  2. His money goes on your Stripe account;
  3. Money on the Stripe account is transferred to your Payoneer account;
  4. You use a credit card from Payoneer to pick up your money from any ATM.

Sounds tricky?

It’s actually quite simple.

Here are the 4 steps you need to go through:

  1. Register dropshipping business in the US;
  2. Open Stripe account;
  3. Register with Payoneer and apply for a virtual USA bank account;
  4. Connect your USA bank account to Stripe.

So let’s go through the details!

Registering your company in the US

First of all, let’s think of the corporate structure for the business you’ll register.

Choosing among different business entities in the US, the LLC (Limited Liability Company) seems the most convenient one and it is easy to start up. It has no corporate taxes and no limitations on who may be involved, and it can be managed by its members or by managers. Besides, it is well-suited for companies with a single owner.

Registering LLC is a rather simple process. You can find many companies which offer such service (we can recommend and You don’t need to present any documents – just submit your corporate information online. You also don’t need to travel to the USA to register a company. All filings can be done remotely, electronically.

What is also important, as a foreigner, you are not required to have Social Security Number to open your company and obtain EIN (company tax ID). You also don’t need to have a US address or phone number, however if you like it’s possible to obtain them from specializing vendors (around $250 per year).

All the process usually takes around 3 weeks and will cost you around $400-1000 depending on the US state you register in, and on other additional options you will choose (for example, creating virtual mailing address, etc.).

Please be careful – there are states where you must pay very high taxes on your business! We didn’t know it at first, and registered our company in California. Later we learned that in California you must pay at least $800 per year as a business tax, and also really high California state taxes. Not that good, right?

Take some time to research USA state taxes, and choose the state with the lowest taxes. Please note that these laws may change from time to time. At the moment of writing this article, we know that in Nevada and South Dakota there are no state and business taxes at all.

Once your LLC is registered and you got your company EIN (company tax ID), it’s time to proceed with Stripe account.

Opening Stripe account

As soon as your company is registered, your business receives a tax ID.

Using this ID, you can register in Stripe.

Simply visit and register your account. After it is registered, you need to activate it by filling an account application. Enter your US company details (including EIN), your personal details, and a digital copy of your ID. In a few days you should be approved.

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Now you can use Stripe gateway on your store and accept credit/debit card payments from your customers! All payments come directly to your Stripe account and you can easily withdraw funds to your US bank account.

Stop! How will you get a US bank account?

After 9/11 and with the passing of the Patriot Act it became really hard for foreigners to open U.S. bank accounts. Only a trip to the US would present you with the best opportunity to open a bank account.

But we have a solution for you!

Registering with Payoneer

In most cases what you need is not a bank account, but the functions provided by a traditional bank account. For this purpose, you can use a reloadable prepaid debit card from companies like Payoneer.

What you get is an internationally recognized debit card and a virtual Bank of America account with routing and ABA numbers that you can easily connect to your Stripe account and withdraw funds directly to your debit card.

All you need to do is register with and connect Global Payment Service to your Payoneer account in order to get a virtual US bank account.

Connecting your USA bank account to Stripe

As soon as you have connected Global Payment Service to your Payoneer account, you can use this private account to take some necessary data.

Then, you need to access your Stripe account, and go to the Payouts section. In this section, you need the Settings tab – here you add your Payoneer account number.

That’s it.

Now the money you get will be transferred to your Payoneer account.

When you register in Payoneer, the company sends you an internationally recognized debit card through ordinary mail. So you take that plastic card, go to any cash terminal, and FINALLY – you’re holding the cash in your hands!

Benefits and advantages for your dropshipping business

So after all, you have your own limited liability company registered in the USA.

It doesn’t cost that much: for our first US company, we paid $634 for LLC registration, and $299 for the USA business and mailing address.

It doesn’t take long: in our case, all the procedures took about a month.

And for all that, you get several meaningful benefits for your dropshipping business:

  • You can earn twice as more as you previously did because you now accept credit card payments;
  • Your business is now fully legal. It’s registered in a real place in a real country, it has a tax ID, and all that.
  • You now have a company in the USA! How cool is that?
  • You have a virtual account where all the money from your buyers is stored. It’s convenient to use and easy to understand.
  • You can rightfully use a convenient payment system. You can transform all the money into real cash, and use it the way you want.

We hope all this information will be useful to everyone who doesn’t live in the USA but wants to register their business in this country. As you can see, registering your dropshipping company in the United States is not that difficult. Instead, it lets you get a lot of legal advantages, and also deal with money easily.

If you have any questions, notes, or your own tips – please leave them in the comments section below! We are always happy to receive your feedback because it lets us make our guides and articles even more helpful and useful.

This content was originally published here.