How do you charge and collect payment for a mobile app business? Is it Stripe? Is it Google/Apple Pay? Or both? How does it work?

by totalanonymitee. Posted on Sep 11, 2020    2    4

Are there any entrepreneurs here that actually generates revenue from a mobile app business? I'm developing a dating app and I'm wondering how to monetization protocol works.

A year ago, someone told me to use Stripe; that they charge a small flat rate plus around 3% of the transaction; that they make deposits into your bank account every few days.

But recently seeing Apple try to push Word Press to monetize their app, it seems like Google/Apple Pay are in play now. I tested paying on a popular dating app and it was paid through Google Pay.

So, how does this work? Do you not need Stripe for app revenue? Or do they work together? Who do you pay, what are the fees and how does it work? How does one set it up?



UnstableCoder 5

The distinction on which service you need is based on whether you’re unlocking functionality within the app, or selling an out of app service.

If you sell in-app functionality, you need to use Apple’s and Google’s respective in-app purchases.

Selling a service/product provided outside the app? You need to use a 3rd party service like Stripe.

What constitutes in-app functionality? Stuff like unlimited swipes on others on the app, unlimited date requests, being feature in searches in the app etc.

What is an out of app service? In the context of a dating app, paying for a dinner/date experience through your app if you’ve matched with someone.

How do you set these up? Look for in app purchases in apples and googles docs. For 3rd party services, they usually have SDKs available.

For your purposes, mainly the in app purchases are needed.

Downside? 30% cut from your sales goes to Apple and google. Way to prevent this? Not much if you want to sell features to your app. We solved this by selling subscriptions on the app’s website as well through a 3rd party payment provider and trying to link people there from the apps as much as possible. Both google and Apple are cracking down and this though and they can remove your app from the App Store, so better to play nice and take a hit.

Apple in app purchases guide

Google in app purchases guide

  totalanonymitee 2

30%?!?! WTF? Wow... That's robbery. Thanks for your reply.

If you don't mind, I have a follow up question. How do you deal with charging taxes to users outside of your state and/or country? I'm based in Ontario, Canada but the majority of our users will be in the States. Do I just charge everyone Ontario rate taxes?

UnstableCoder 1

The provide the store, access to a high number of possible customers, as well as the tools to build apps. It’s a very steep price, but lots of business models, like dating services are much harder to make work on websites.

A unified account for your apps & website, plus possibility to sign up via the website can help.

Not an expert on taxes, I’d contact a CPA if you’re starting to make sales.

Mainly your case would be coming through google and Apple, they are the ones making the sales by proxy as I understand and you only get a monthly transfer from them. Could be wrong but I believe this simplifies things.

This is not the first thing to consider though, should come after you’ve validated your business model, made your first sale, etc.

kirklennon 3

Part of your 30% fee (which is completely standard for software, and much cheaper than it was for boxed retail software) is that the store worries about the taxes and exchange rate for you. You set your fee as a standard price tier and then the store handles almost everything else for you.