Stripe agrees to buy embedded lender Parafin

Stripe said on September 30 that it has agreed to acquire Parafin, an embedded financial products company that lets software platforms offer credit to their small-business customers, according to Payments Dive. A Stripe spokesperson declined to comment on the price. Parafin was valued at $750 million as of late 2024, according to the same report.

Parafin works with platforms including DoorDash, Gusto, Jobber and Mindbody, according to Finovate. Founded in 2020, the company says it has funded more than $3 billion to over 60,000 small businesses in the United States, according to Channel Life. Its products include flexible and term loans, business-to-business pay-over-time products and credit cards, with repayments linked to sales.

The deal adds Parafin’s credit portfolio to Stripe Capital, the financing product Stripe already offers to platforms, according to The Paypers. Stripe business lead Neetika Bansal said platforms are central to the company’s mission and that Parafin’s team brings expertise in credit, risk and embedded financial products. Parafin chief executive Sahill Poddar said the company was founded to give small businesses access to credit products that had been available mainly to large companies.

More than 18,000 platforms use Stripe as a financial services portal for the small businesses on their systems, according to American Banker. Stripe said the number of businesses launching on its technology rose 86 percent year over year in the second quarter, while only 41 percent of small business loan applications in the United States were approved in 2025, according to Finovate.

It is Stripe’s third acquisition of 2026 and its 24th overall, following its purchase of the legal infrastructure startup Clerky about a month earlier. Aaron McPherson, a principal at AFM Consulting, told American Banker that Stripe is trying to diversify into higher-margin businesses to supplement its core payments services.

Stripe was also part of the consortium with Advent International that abandoned its pursuit of PayPal on August 28.