Stripe stands out for invoicing and recurring payments. PayPal also has more methods for accepting micropayments, supports peer-to-peer transactions, and provides easier access to your funds. This means you receive the more favorable rate between micropayment fee or standard commercial transaction fee for every transaction. Businesses that directly open a business account with PayPal are automatically enrolled in its dynamic micropayment pricing scheme. PayPal is our choice for micropayments, mainly because it is more upfront with its micropayment fees. These fees are waived for businesses using Stripe’s standard pricing. On the other hand, Stripe does not publicly disclose a microtransaction program, but if you contact Stripe Support, you may be eligible for a custom micropayment rate, which is typically quoted at 5% + 5 cents for transactions under $5.Īnother drawback to Stripe is that opting into a custom rate, even for microtransactions, means that you will be charged 5 cents for every attempted transaction that goes through the Stripe Radar security program. PayPal offers a dynamic transaction fee method for accepting micropayment transactions. *Must contact Stripe to apply for a custom microtransaction rate. However, the main reason to choose PayPal as a payment processor is if you want an affordable, trusted alternative for your customers. PayPal offers excellent rates for nonprofits and deserves consideration. For an advanced POS system, you’ll need to go to a third party, just like with Stripe. When To Choose PayPalįor businesses with very basic POS needs such as retailers at farmer’s markets, food trucks, or stores with limited inventories, the PayPal Zettle mobile app may have sufficient POS capability for free. #Paypal logo with credit cards fullIf you primarily handle online sales or need a full POS system, it’s the more economical choice. Stipe has a simpler, less expensive schedule of fees, discounts for high-volume sales and nonprofits, and lower chargeback fees. #Paypal logo with credit cards plusPayPal, on the other hand, has a long list of differing payments for varying situations, plus different fees for individual countries. Its payment processing fees are overall less expensive and easier to understand. We choose Stripe as the overall winner for affordability. Square’s flat-rate transaction fees are also one of the most competitive rates in the market today, and Square tops our list of best merchant services for small businesses and individuals. #Paypal logo with credit cards freeLike Stripe and PayPal, Square provides you with a host of tools to process online transactions but stands out because it includes a built-in, fully integrated ecommerce, mobile, and in-store POS features-all in a free plan. If you run a small business that also makes in-person sales, you will be better off using an all-in-one merchant services solution like Square Payments. PayPal offers instant fund access with PayPal balance while Stripe’s charges a fee for instant payouts.Both PayPal and Stripe offer micropayment transactions, however, PayPal comes with a built-in dynamic transaction fee method while you need to contact Stripe to sign up for its microtransaction program.PayPal offers simple plug-and-play checkout solutions while Stripe requires some technical skill to add its checkout templates on your website.While both offer pay-as-you-go and free plans, PayPal requires a $30 monthly fee for the use of its virtual terminal and recurring payments.Stripe can be integrated to numerous point-of-sale (POS) systems while PayPal offers its own POS app, PayPal Zettle.Stripe offers volume discounts for businesses that process large volumes of transactions while PayPal does not.Stripe charges a simple 2.7% + 5 cents for in-person and 2.9% + 30 cents flat rate for online payments, vs PayPal’s fees, which range from 1.9% + 49 cents to 3.5% + 49 cents per transaction. PayPal’s transaction fees are more complex compared to those of Stripe.
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