First, we’ll go over the simplest scenario: the buyer pays in USD, and the connected account settles in USD (e.g. they have a US bank account).
Payment to the platform account
Here, the customer pays $10, and Stripe takes $0.59 (2.9% + 30 cents, see https://stripe.com/pricing for more details).
Transfer to the connected account
$10 goes to the connected account, and $0.29 is taken as fees. This is the application fee.
Overall, we’ve actually lost money on this transaction, because Stripe took $0.59 and we only made $0.29. This can be “fixed” by increasing the application fee amount.