PayPal or Stripe? Your best online payment gateway!

Choosing the right way of online payment is always a headache as online payments come with both ease and risk factor. Online payments are always tricky, thus you have to choose the most appropriate and the most secure payment processing. Whether you are a customer or you have an eCommerce website, at some point in life, we have to resort to online payment methods.

This article will help you select the online payment gateway companies that are most suited to you. For a decade now, PayPal and Stripe have been the most conventional methods used for online payments. With the comprehensive comparison between PayPal and Stripe and by the facts and figures stated in this article, your search will further be narrowed down.

Now the question is why do you need to make online transactions or payments? Well, every person has to make or receive payments online at least once in a lifetime.

Where is online payment used?

Basically, online payments are used all over the Internet. You want to buy or sell anything, want to get a subscription or membership or want to book a hotel or flight on the Internet, online payment is your only way to go. In particular,

  • Freelancing
  • E-commerce websites
  • Online Service providers
  • Agencies
  • Mobile application stores
  • Mobile applications (Android, iOS)
  • Online bookings, memberships, subscriptions, etc.
  • Online non-profitable donation portals

PayPal vs. Stripe

In this article, we have narrowed down your research to the two most widely used and the best online payment gateways PayPal and Stripe. This article will answer all your queries regarding PayPal and Stripe through a detailed comparison between the features and compatibilities of the two.

  1. Currencies and Countries
  2. Transaction fee
  3. Payment Types and Methods
  4. Third Party Integrations
  5. Billing Options
  6. Security
  7. Getting Paid
  8. User Friendliness
  9. User Reviews
  10. Developer Point of View
  11. Customer Support

1. Currencies and Countries

Stripe is currently available in 34 countries. You can find the list of the countries by following this link. If your country is not on that list then no worries, as you can request its services in your country as well. Stripe also allows you to access it through any country by using Atlas, to integrate a U.S. based company, and setting up a U.S. bank account. In this way, you will be able to receive payments from all over the world with Stripe. Despite its access in a limited number of countries, Stripe supports multicurrency payouts that let you transfer money in over 135 currencies.

Whereas PayPal is globally available as it accepts payments from users in over 200 countries, almost the whole world. But it only allows processing in 25 currencies. You can find the list of accessible countries and currencies following this link.

Final word is that the choice between PayPal and Stripe depends on the scale of your business. Whether your business deals with the customers worldwide or your customers are confined to a region and use a limited range of currencies.

2. Transaction fee

The transaction fee is one of the most important factors to keep in mind while choosing the best online payment system for your online business, as it directly affects the revenue generated. For both PayPal and Stripe, there are different stages of transaction fees depending on the services you avail. Initially, the user can sign up for free very conveniently by just entering his/her region and bank account details. There is no registration fee or monthly charges.

Once you get into the business, then there is a flat rate, whether you are sending money through PayPal or Stripe, using debit or credit card, they charge you a 2.9 percent of the amount you send. They charge you an additional 30 cents on every transfer. However, there are no charges on personal transactions that are made to a friend’s or family member’s account.

Transaction Fee
Transaction Fee

In addition to this flat rate, there are many other aspects that differentiate the two. For instance,

  • Card Charges: PayPal charges 30% per month on your card while Stripe is free.
  • Refund: Paypal returns only fixed amount of fee on refund while Stripe does not refund fee at all.
  • Chargeback: Chargeback at Paypal is $20 while at Stripe is $15.
  • International Cards: 1% of the amount of is charged on international cards for PayPal while Strip is free of cost.
  • Authorized cards: PayPal charges 30 cents on authorized cards while Stripe charges nothing.
  • Micropayments: For the payments less than 10$, PayPal charges 5% the amount sent plus 0.5 cents whereas Stripe has its same flat rate for all payments.
  • Recurring Billing: For PayPal, its fee is 10$ per month while it is free for Stripe.
  • Advance Fraud Protection: You can avail fraud protection on PayPal for 10$ per month while it is totally free on Stripe.

Keeping all these factors in view, it is quite clear that PayPal’s services and rates are not straightforward and Stripe is cheaper with its lower service charges.

3. Payment Types and Methods

Now when it comes to online payments, it can be of different types. We will give you an insight on types and methods of payments accepted by Paypal and Stripe.

Payment can be for goods or services or can be a gift.

PayPal gives you a number of options of payment types to choose from. You can choose the type that is most preferable for you. Not just one but you can choose more than one payment methods from PayPal cash or PayPal Cash Plus account balance, a bank account, PayPal Credit, debit or credit cards, and rewards balance. These options are intelligently suggested to the user while making a payment keeping in view the payment type.

Stripe also offers a huge range of payment methods to its users. The trend of the most used payment methods varies from region to region. The payment methods for Stripe users are their bank account credit or debit card, Master or Visa card, ACH credit debit, Alipay, Apple Pay, Bancontact, EPS, Giropay, Google pay, iDEAL, Multibanco, SEPA Direct Debit, and Wechat Pay. With its extended list of payment methods, Stripe gives its users more freedom to choose when and how to pay for a purchase.

From an online business perspective, these e-commerce payment gateways provide seamless transactions and payments with their transparency and low fraud risks, as all the payment methods are authorized.

4. Third Party Integrations

While choosing between PayPal and Stripe for your business, you would want to consider what third-party integrations are offered by both. However, the third-party applications, APIs, services and plugins offered by Stripe are way more than that offered by PayPal. But again we will say that it depends on your business. If you have a large scale business that needs quite a many integrations then Stripe is your choice but if you have a startup or you are a freelancer then PayPal is the better option for you.

PayPal provides integration with the most nominal and common business platforms like CRM, E-commerce, accounting, Woo Commerce, QuickBooks, and Salesforce. With these simple plug and play features, you can integrate your system.

It’s not possible to mention all the extensions and plugins in one article so you can find the list of the third party integrations supported by Stripe following the link.

Third Party Integration
Third Party Integration

5. Billing Options

The billing options for both PayPal and Stripe are somewhat the same so it is really a tie. With PayPal, you can choose between one time payments and recurring billing.

  • Multichannel: As the name says, for large businesses and cross-platform application owners use Multichannel billing option where the customer can pay through phone, mobile app, PayPal website or the store other than from your own website.
  • Subscriptions: For long term revenue generating businesses that need recurring billing options, PayPal offers subscriptions to its users. Subscriptions can be weekly, monthly or yearly depending on the type of your business.
  • Invoicing: PayPal provides invoicing services too. As in, professionally customized invoices are sent to the customer for every payment made. Customers can pay through credit or debit card or through PayPal.
  • Marketplace compatibility: PayPal also provides a solution for marketplace eCommerce websites that involve multiple other platforms in the payment process.

Here are the advanced billing options offered by Stripe.

  • Stripe Connect: You can use Stripe Connect to set up payments for marketplaces and platforms. It provides quick and easy integration with any platform to accept and pay payments via third parties.
  • Online Invoicing: With Stripe’s free online invoicing services customers can receive invoices for single-send and recurring payments.
  • Subscription & Recurring Payments: There is no parallel in Stripe subscriptions and recurring payment plans. Its built-in flexibility gives unlimited customized subscription options.
  • Mobile Payments and Processing: eCommerce mobile cross-platform applications (Android and iOS) use in-app purchases. If you want such services then Stripe is your way to go.
  • Virtual Terminal: Stripe offers a platform for small scale businesses that need customers credit cards to make payments, named Virtual Terminal. User can create his/her own personalized dashboards where you can unify offline and online channels with developer tools and cloud-based hardware sources.

6. Security

PayPal and Stripe are two of the safest online payment gateways, worldwide with least fraud risk. When you are choosing a payment partner for your website you need to be sure and relieved that your money and sensitive data is in the right hands. Both platforms offer services without any loopholes and hidden charges.

All users are validated according to the standards provided by the PCI Security Standards Council. Moreover, your payment pages are secured using TLS (Transport Layer Security), making sure that they are using HTTPS.

7. Getting Paid

Getting paid through PayPal or Stripe is really easy, just like one two three. You just have to have an active bank account. Your payments will reach to you in one business day if you are using PayPal but if you are using Stripe, it will take a little longer, about two days for your payment to get to you.

8. User Friendliness

PayPal is more user-friendly, as you don’t have to be a developer to use PayPal, a common person with little tech knowledge can set up his/her own payment portal. With its highly interactive user interface and intelligent suggestions, it is really straightforward to build your own website, Whereas developers can be more playful with Stripe exploring its extensive range of integrations, extensions, and plugins.

9. User Reviews

User reviews about both the platforms are really good and positive. Close to zero fraudulent payments or scams have been complained by the users. PayPal and Stripe have been rated as the best online payment processors.

The features of PayPal that are most talked about, by its users, are:

  • Quick and easy Signup
  • Nice APIs to work with
  • Extensive and elaborate documentation

Whereas Stripe users recommend its following features:

  • Quick and Easy Setup
  • Transparent pricing
  • Countless products and services
  • Widely accepted payment methods

However, users have reported somewhat same issues in using PayPal and Stripe:

  • Withheld funds, freezing and termination of accounts
  • Unresponsive phone support

10. Developer’s Point of view

Developer’s choice is Stripe without any question because Stripe’s framework is built keeping in mind a developers point of view. With its numerous third-party integrations and plugins, it allows the developer to mold and customizes its business according to his/her requirements. Originally developed as a development tool, Stripe has several dimensions to explore for a developer.

11. Customer Support

24 hours customer support is available on both online payment services providers. Their support team is always up to answer your queries. Fraud protection, 24/7 monitoring & secure encryption technology make requesting money with PayPal and Stripe a less stressful transaction. Listed down are the forums where you can reach out to PayPal or Stripe.

  • Help Centers
  • Community Forums
  • Developer Centers
  • Email Support
  • Live Chat Support
  • Social Media – Twitter accounts for PayPal and Stripe are @AskPayPal and @Stripe respectively.
  • Phone Support

Final Word

In some ways, Paypal surpasses Stripe and in some other ways, it’s the vice versa. It really depends on what services you want to avail. However, if you don’t want to make a choice between the two then you can use both. It will be the decision of your customer what payment method he/she wants to opt. Sites like WooCommerce and EasyDigital Downloads offer payments via both PayPal and Stripe.

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