Payment Infrastructure for SaaS

Payment processing is one of the most critical and sensitive components of a SaaS application. Errors in billing damage customer trust, and security vulnerabilities expose financial data. Stripe is the leading payment platform for SaaS companies, providing APIs for subscriptions, invoicing, tax calculation, and more. At Nexis Limited, our SaaS products use Stripe for subscription management and payment processing.

Core Stripe Concepts

Customers

Create a Stripe Customer for each user or organization in your application. Store the Stripe customer ID in your database, linking your internal user model to Stripe's customer record. This enables subscription management, invoice history, and payment method management.

Products and Prices

Products represent what you sell (HRM Basic, HRM Pro, HRM Enterprise). Prices define how much you charge (monthly, annually) for each product. Use Stripe's product catalog rather than hardcoding pricing in your application — this enables price changes without code deployments.

Subscriptions

Subscriptions handle recurring billing automatically. Stripe creates invoices on each billing cycle, attempts payment collection, handles retries for failed payments, and manages subscription lifecycle events (created, updated, canceled, past_due).

Webhook Integration

Webhooks are the backbone of reliable Stripe integration. Stripe sends events to your webhook endpoint for billing events — successful payments, failed payments, subscription changes, and invoice creation. Critical practices:

  • Verify webhook signatures to prevent fraud.
  • Process webhooks idempotently — Stripe may send the same event multiple times.
  • Respond with 200 quickly and process events asynchronously.
  • Handle the most important events: invoice.paid, invoice.payment_failed, customer.subscription.updated, customer.subscription.deleted.

Checkout and Payment UI

Stripe Checkout

Stripe Checkout is a hosted payment page that handles payment method collection, card validation, 3D Secure authentication, and mobile optimization. It reduces PCI compliance scope because card data never touches your servers. Use it when speed of implementation is a priority.

Stripe Elements

Stripe Elements provides customizable UI components that you embed in your own payment page. You get more control over the design while Stripe securely handles card data collection. Elements are PCI-compliant because card data goes directly from the browser to Stripe's servers.

Handling Taxes

Stripe Tax automatically calculates and collects sales tax, VAT, and GST based on customer location and product type. Enable Stripe Tax to simplify tax compliance across jurisdictions. For digital services, tax calculation varies significantly by country and sometimes by state/province.

Subscription Lifecycle Management

  • Free trials: Offer trial periods without requiring payment upfront using trial_end on subscriptions.
  • Upgrades and downgrades: Use subscription item changes with proration to handle plan changes mid-cycle.
  • Cancellation: Offer cancel-at-period-end to retain the customer until the current billing period expires.
  • Failed payments: Configure Stripe's Smart Retries for automatic payment retry logic. Send dunning emails for persistent failures.

Security Considerations

  • Never log full card numbers, CVVs, or payment tokens.
  • Use Stripe's client-side libraries (Checkout, Elements) to minimize PCI scope.
  • Restrict Stripe API key access to production servers only.
  • Use restricted API keys with only the permissions your application needs.
  • Monitor for suspicious activity in the Stripe Dashboard.

Conclusion

Stripe provides the infrastructure for reliable, secure payment processing. Invest in proper webhook handling, use Stripe's hosted solutions to reduce PCI scope, and handle subscription lifecycle events gracefully. Payment integration is high-stakes — test thoroughly in Stripe's test mode before going live.

Building a SaaS product with payments? Our team has integrated Stripe across multiple production SaaS platforms.