10 Best PayPal Alternatives 2020

PayPal is a global name in online payments, but there are plenty of cases where an alternative to PayPal is a better choice for business or peer-to-peer payments. Some alternatives to PayPal deliver lower processing fees or faster deposits. Other PayPal alternatives offer more advanced peer-to-peer payments, like free instant transfers between bank accounts.

How We Evaluated PayPal Alternatives for 2019

PayPal is a global brand with payment solutions that cover many bases: online, mobile, in-store credit card processing, online invoicing, and peer-to-peer funds transfers. Only one PayPal alternative, Square, matches most of PayPal’s vast range of capabilities. Most alternatives to PayPal deliver fewer payment solutions, but offer better, faster, or more economical options for a specific need.

The right PayPal alternative for you depends on your payment processing needs. For example:

• Online sellers and retail store owners: Small businesses need a way to process card payments several ways—in-store, online, and using mobile card readers.
• Service providers: Business and individual service providers can benefit from mobile credit card readers, online invoicing, and peer-to-peer payments.
• Individuals: Friends, family, and acquaintances need a simple, free way to send and receive money online or via app.

The best alternative to PayPal depends on a user’s specific payment needs, so we reviewed an array of criteria, including:

• Ease of use: These PayPal alternatives offer intuitive online, in-store, and mobile app payment management options.
• Cost: Our top picks meet or beat PayPal’s competitive payment processing rates—and support free peer-to-peer payments.
• Online payments: Online payment alternatives to PayPal deliver secure ecommerce payment processing at competitive rates.
• Mobile payments: Several alternatives to PayPal offer better mobile payment processing and credit card readers than PayPal delivers.
• In-store payments: Several alternatives to PayPal offer full retail point-of-sale (POS) systems with inventory and business management features that top PayPal’s free POS.
• Invoicing and recurring payments: Some PayPal alternatives offer more economical solutions for businesses that use online invoicing and recurring payments.
• Direct peer-to-peer payments: PayPal peer-to-peer payments are simple and secure, but several PayPal alternatives are gaining popularity.
• E-wallet payments: Other financial service providers offer user-friendly payments similar to PayPal.

Overall, Square is our top recommended PayPal alternative for both business and personal payments. It’s the closest match to PayPal in a point-by-point comparison, plus it beats PayPal on many factors important to startups and growing businesses. For example, Square’s free retail POS system, business management tools, and mobile payments options obliterate PayPal’s rather basic offering.

Square: Best Overall PayPal Alternative

Square is the best overall PayPal alternative for business and personal payments. It matches most of PayPal’s capabilities and, in many instances, exceeds them. Square delivers a better retail POS system and better mobile payments than PayPal, plus it has no monthly fees. PayPal charges $40 per month for access to all payment tools.

Square Pricing

Square’s payment processing fees are competitive with PayPal. Both charge 2.9% plus 30 cents per online sale, but for mobile and in-store sales, Square’s 2.6% plus 10 cents per transaction is slightly more than PayPal’s 2.7% fee. However, Square gives you all payment features for free—including a virtual terminal and recurring payments. PayPal charges $40 per month for these features.

*Funds are available in your PayPal account immediately.

When comparing Square vs PayPal, PayPal offers some reduced payment processing rates for certain users, which Square doesn’t match. For example, nonprofits can qualify for 2.2% plus 30-cent fees for online sales or donations via PayPal. However, the services and fees above apply to the majority of users.

Square Features

Like PayPal, all-in-one payment processing is the core of Square service. However, unlike PayPal, Square’s online, in-store, and mobile sales and payments are all managed within a single free account. To start a new payment method in Square, like setting up recurring payments, you simply start doing it. In contrast, PayPal requires upgrades to paid accounts and feature add-ons (some with fees) to equal all that Square delivers in a free account.

Like PayPal, Square also offers a free POS app. However, Square’s is much more robust than PayPal’s, offering better inventory management, customer directories, and reporting. Square also offers a free, full-featured online store, and you can easily set up a Square checkout to accept credit cards online. Square also has optional add-on features for marketing, loyalty, and online sales tools.

What Square Is Missing

Square doesn’t accept PayPal Payments, but you can set up a separate free PayPal account if you need that option to accept online or peer-to-peer PayPal payments. Also, Square’s recurring payments feature is limited compared to PayPal’s robust recurring payment capabilities. If you need this for online subscription sales or online memberships, PayPal’s $40 monthly fee can be worth the cost.

Square Reviews

In Square user reviews, individual sellers, startups, and small businesses all tout the many free perks and ease of using Square to sell anywhere their business takes them. Dissatisfied users note account holds and problems with chargebacks, which is not uncommon with any payment processing service.

Shopify Payments: Best Ecommerce & Multichannel PayPal Alternative

Shopify Payments is the best PayPal alternative for multichannel retail businesses. Shopify Payments comes built-in with all Shopify online stores, Shopify POS, and offers competitive transaction fees. Plus, you’ll have access to Shopify’s robust retail tools, which are significantly more powerful than PayPal’s free POS and invoicing system.

Shopify Payments Pricing

In services and fees, Shopify Payments competes with PayPal, Square, and Stripe. Online payment fees are 2.9% plus 30 cents for users on Shopify’s base plan, and drop to 2.4% plus 30 cents at the highest plan level. Likewise, Shopify POS and mobile payment fees range from 2.7% to 2.4%, depending on your Shopify plan.

*Funds are available in your PayPal account immediately.

On May 4, 2020 Shopify released POS Pro for $89/month in addition to the free POS app. We will update this article to reflect the new pricing and features.

Shopify Payments doesn’t match all of PayPal’s payment processing services. Recurring payments require third-party add-ons with added costs, and there are no peer-to-peer payment features. However, Shopify Payments is an economical PayPal alternative for Shopify stores.

Shopify Payments Features

Shopify Payments is designed to help Shopify sellers sell everywhere, and is a sound alternative to PayPal in terms of supporting many types of payments. In fact, it’s more like Square than PayPal since it ties your online, mobile, and in-store sales within one streamlined system and delivers robust retail POS features. However, Shopify Payments can only be used with Shopify POS or ecommerce, which requires a monthly subscription. That makes Shopify much different from PayPal, which can be used on just about any website and via a free POS app.

What Shopify Payments Is Missing

Like all other PayPal alternatives, Shopify Payments doesn’t accept PayPal Payments. For this, you’ll need to add PayPal to your Shopify account, which takes just one click. However, Shopify will add its platform transaction fee to any order paid via PayPal. Since PayPal is so popular for online payments, most online sellers just consider that the cost of attracting added sales.

Shopify Payments also falls short as a PayPal alternative in invoicing, recurring payments, and peer-to-peer payments. Since it’s really designed as a multichannel online, in-store, and mobile payment solution for Shopify users, these features aren’t missed by most.

Shopify Payments Reviews

Shopify has a true fan following, and the majority of Shopify user reviews praise the company for all of its built-in multichannel selling features. Shopify Payments is well received too. Naturally, some sellers grumble over the per-order fee ploy that makes other payment processors more costly to use on Shopify. However, its ease, competitive fees, and all-in-one payment features make it a convenient and economical choice for most Shopify sellers.

Stripe: Best PayPal Alternative for Custom Online Payments

Stripe is a leading alternative to PayPal for online and mobile in-app payments. Stripe doesn’t match PayPal in certain areas, like mobile credit card readers or peer-to-peer payments. However, it tops PayPal with highly customizable online and app-based mobile commerce payment solutions—and for global online payments.

Stripe Pricing

Stripe has no account fees and, like PayPal, Square, and other all-in-one payment solutions, offers simple-to-understand payment processing fees. Stripe charges 2.9% plus 30 cents per transaction to process credit cards, which matches PayPal’s online fees. Stripe also lets you accept e-check and ACH payments for a low 0.8% fee—something PayPal doesn’t support.

*Not built-in features, requires a third-party integration, equipment, and added costs.

Stripe vs PayPal International Payment Processing Fees

Stripe also excels in global payment processing for international sellers. It accepts many international payment methods and adds just a 1% processing fee to its usual 2.9% plus 30 cents fee for international sales—or 2% if conversion fees apply. So you’ll pay just 3.9% to 4.9% plus 30 cents to process international payments with Stripe. This is quite competitive with (and more predictable than) PayPal’s 4.4% plus varying currency-based, per-transaction fee.

Stripe Features

Stripe is a sleek, secure, top-rated online payment solution that integrates with virtually all ecommerce platforms. It’s ideal for all types of online sales and for managing recurring payments for subscription-based businesses and membership sites. Stripe also supports in-app payments for mobile commerce and lets users build simple form-based checkout pages and pop-up windows.

What Stripe Is Missing

Stripe doesn’t deliver the all-in-one multichannel online, in-store, and mobile sales solution that Square, Shopify, and PayPal deliver. You won’t get lower processing fees on in-person payments with Stripe—plus you’ll need outside services to enable this functionality. Because of this, Stripe is a top PayPal alternative for online payments, but not for combining in-store, mobile, and online payments in one solution. Stripe also doesn’t support peer-to-peer payments.

Stripe Reviews

Stripe user reviews are mixed, mainly because it offers no personal assistance. It’s up to you to figure out Stripe if you’re using it for a custom solution. If you encounter processing problems, assistance can be slow. However, users love Stripe’s custom capabilities since they can add sleek, secure checkouts to sites and apps. See what real-world users have to say in our Stripe user reviews.

Fattmerchant: Best PayPal Alternative for High-volume Sellers

Fattmerchant is a PayPal alternative offering substantial savings on credit card processing when you reach about $20,000 in monthly sales. Ecommerce sellers, retailers, mobile sellers, and businesses using online invoicing and recurring payments can use Fattmerchant. However, it’s important to run the math first—Fattmerchant charges a $99 monthly account fee for each payment type.

Fattmerchant Pricing

Fattmerchant is an economical alternative to PayPal for businesses processing around $20,000 in credit cards per month. Fattmerchant’s unique fee structure pairs high monthly account fees with the low base interchange rates that credit card providers charge. Fattmerchant doesn’t mark up this interchange fee—you just pay interchange plus Fattmerchant’s monthly and small per-transaction fees.

*If you need more than one payment account, Fattmerchant reps offer multi-account discounts at sign-up.

Running the numbers is the best way to decide if Fattmerchant is the best alternative to PayPal for your business. To do this, you need to know a bit about base interchange rates, which are the base fees that credit card issuers charge processors to clear payments.

How to Compare Fattmerchant vs PayPal for Fees & Account Costs

Most credit card processors—PayPal, Square, Stripe, and traditional merchant accounts—make their money by marking up interchange fees. Fattmerchant doesn’t work this way. Instead, they charge monthly and just add a small per-transaction fee to the base interchange charge.

Interchange rates vary based on the type of card a shopper uses, but typical interchange rates for retail and online payments are:

• In-person (card present) payment: 1.51% plus 10 cents per transaction
• Online (card not present) payment: 1.80% plus 10 cents per transaction

Rates per Visa’s consumer card interchange tables

Using these base interchange rates, you can run the math to see if Fattmerchant is the best PayPal alternative credit card processing. For example, we’ve found that at around $20,000 in sales per month, Fattmerchant becomes the more affordable payment processor.

At around $20,000 in monthly sales, we’ve found Fattmerchant to be the more economical choice over PayPal and other all-in-one solutions. However, if you need to accept payments many ways—via an in-store POS, online, and using mobile card readers or online invoicing, Fattmerchant requires a separate subscription—with monthly fees—for each.

Taking the numbers above, if that $20,000 total was split between online, in-store, and mobile card reader sales, you’re looking at $298 in monthly fees for three Fattmerchant accounts. That’s when PayPal or Square can save a small multichannel seller money.

However, Fattmerchant does offer combined account discounts at sign-up, and as you grow, the savings from Fattmerchant’s base interchange fee structure become more substantial. To decide if Fattmerchant is the best PayPal alternative for your credit card processing, simply run the numbers as we did above.

Fattmerchant Features

Fattmerchant offers a full range of payment processing solutions that make it a very viable alternative to PayPal—especially for multichannel sellers. What’s more, it offers the best customer service of any provider on our list. We received responses to queries in minutes, and you can speak to an account rep via phone, email, or online chat.

What Fattmerchant Is Missing

Fattmerchant doesn’t support peer-to-peer payments, so it’s not the right PayPal alternative if that’s what you’re looking for. Beyond that, there’s little missing from Fattmerchant’s well-rounded suite of payment processing services.

Fattmerchant Reviews

Fattmerchant user reviews are glowing. Once you understand the fee structure, Fattmerchant is an extremely economical solution for many small but growing businesses. Occasional comments pop up about processing delays, but that’s never 100% with any processor. Fattmerchant’s excellent customer service apparently smooths over issues quickly.

Venmo: Best PayPal Alternative for Peer-to-Peer Payments

Venmo is a popular peer-to-peer payment app. It doesn’t check all of the boxes that PayPal does as a complete business and personal payment solution. Instead, it makes person-to-person payments quick, easy, and free for debit or bank transfers. Plus, Venmo’s feed and interactive features make Venmo a hybrid payment and social media app.

Venmo Pricing

Venmo accounts are free, and sending money via a debit card or a bank account is free. If you use your credit card to fund payments, Venmo charges 3% of the amount sent. Businesses that use Braintree (a PayPal company) for payment processing can accept Venmo payments from customers at PayPal’s usual 2.9% plus 30 cents fee.

Clearly, Venmo is not a PayPal alternative for businesses looking to accept credit card payments. Rather, Venmo is an alternative to PayPal for peer-to-peer payments. Here, it beats PayPal’s 2.9% plus 30 cents per transaction fee if you use debit cards to fund payments.

It’s important to note that Venmo is designed to be used among friends to reimburse meals, rent, and easily share or split payments. Unlike PayPal, Square, and other alternatives to PayPal, Venmo does not offer any buyer or seller protection—it’s best to avoid payments to people you don’t know.

Venmo Features

Venmo is a pretty simple peer-to-peer payment solution. You install the app on your mobile device, connect your debit, credit, or bank account, and send payments to other Venmo users. Typically, funds arrive and can be withdrawn within one business day, but you can pay a 1% fee for instant transfers. You can also use Venmo to share recent purchases via social media, which makes it a popular app among millennials.

Venmo isn’t an official business payment solution. However, many solopreneurs and independent service providers use the “Request Money” feature to collect payments from customers and clients—much like PayPal’s funds request option. Plus, businesses that use Braintree payment processing can offer Venmo as a payment option. This is handy because Venmo allows multiple customers to split bar tabs, restaurant checks, and other purchases at checkout.

What Venmo Is Missing

As a peer-to-peer payment solution, Venmo clearly delivers what users want, as is proven by its meteoric popularity. Compared to the complete business payments solutions on this list, Venmo doesn’t compete in processing online, mobile, or in-store payments. Also, the “Request Money” feature that some businesses use doesn’t have any invoicing tools attached to it, unlike PayPal and Square.

Venmo Reviews

Venmo user reviews prove the app has a serious fan base—so much so that “Venmo me” is fast becoming part of the millennial lexicon. In the Apple app store, Venmo holds a strong 4.9 out of 5-star rating, with more than 6 million reviews on record. That’s about the best user rating and overall performance of any mobile app out there.

Zelle: Best PayPal Alternative for Direct Bank Transfers

Zelle is a peer-to-peer payment alternative to PayPal that is similar to Venmo. In fact, it’s Venmo’s fastest-growing competitor. Zelle enables free, instant payment transfers between bank accounts, effectively replacing checks, ACH payments, and wire transfers.

Zelle Pricing

Zelle accounts are free and there are no funds transfer fees. Zelle connects to bank accounts and debit cards (you can’t use a credit card to fund Zelle payments—thus no credit card fees, unlike PayPal). Zelle integrates with many major banks—most support Zelle for free, but it’s best to check with your bank.

Zelle Features

Zelle’s peer-to-peer payment app is backed by major banks, including JP Morgan Chase, Bank of America, and many others. It its app-based instant bank transfers are intended for personal use. However, small service providers and solopreneurs are already using it to receive payments from clients they know and trust.

What Zelle Is Missing

Unlike Venmo and PayPal, Zelle doesn’t let you send funds using your credit card. You must connect your bank account or debit card to Zelle to send or receive money. Also, there are no formal business payment solutions, but it’s under consideration for the future. As a PayPal alternative, Zelle primarily beats other peer-to-peer options with free, instant bank transfers.

Zelle Reviews

Zelle is a relatively new payments platform. However, Zelle user reviews are mixed. Reviewers say it’s a straightforward platform that can be easy to use once it is set up. However, some reviewers cite difficulty setting up Zelle with their bank and successfully completing transactions.

Payline Data: PayPal Alternative for Multichannel Sales

Payline is a merchant service provider that offers competitive processing rates for businesses accepting credit card payments online, in-person, or over mobile. Payline also has direct integrations with most popular ecommerce platforms. In-person sales capabilities, low processing rates, and easy ecommerce setup make Payline Data an attractive PayPal alternative for multichannel sales.

Payline Data Pricing

Payline has an interchange-plus pricing model, which means Payline passes along the fees from credit card issuers (Visa, Mastercard, Discover, American Express) along with a small markup. For in-person (card-present) transactions, Payline charges businesses .2% plus 10 cents per transaction, plus the interchange fee. There is also a $10 monthly fee.

For online transactions, Payline charges .3% plus 20 cents per transaction on top of the interchange fee. There is a $20 monthly fee for businesses accepting credit cards online. There are no cancellation fees, PCI fees, or annual fees. One of the main differences between PayPal and Payline is the fee structure. Payline charges monthly fees to accept credit cards in-person or online. PayPal does not have any monthly fees to set up ecommerce, invoice, mobile, or in-store payments.

*Funds are available in your PayPal account immediately.

Payline Data Features

Payline integrates with Shopify, WooCommerce, BigCommerce, PrestaShop, and many more for easy online sales. Payline also has a mobile POS app for accepting in-person payments. Payline also works with Clover for an integrated POS solution.

Payline’s virtual terminal allows businesses to store customer data, view reports, send invoices, set up recurring payments, and integrate with QuickBooks. If you are an established or growing business, Payline’s interchange-plus model could be more cost-effective than PayPal’s flat-rate fees.

What Payline Data Is Missing

The biggest flaw with Payline is that the free mobile POS app is extremely limited. It lets you enter a dollar amount and process sales. However, you cannot track inventory or view sales reports through the app. The other flaw of Payline is that, while it offers competitive pricing, it is not the cheapest credit card processor available to small businesses.

Payline also does not have any options for peer-to-peer payments, and it requires an application to open an account. So, if you are not a business, Payline is not a good fit.

Payline Data User Reviews

Payline user reviews are overall very positive. They say that it is cost-effective and easy to use. Reviewers also say that there are no hidden fees, and that Payline customer service is accessible and helpful.

Payoneer: PayPal Alternative for International Payment Transfers

Payoneer is a financial services company specializing in U.S. and international payment transfers. Payoneer can facilitate online card, e-check, and bank transfer payments in multiple currencies. However, Payoneer is not a merchant account, meaning it is a good fit for freelancers and consultants, but not ecommerce or larger businesses needing a shopping cart.

Payoneer Pricing

Payoneer pricing is fairly transparent and offers affordable financial services for individuals or small businesses that need to bill or pay service providers such as freelancers or consultants, especially overseas payments. Like PayPal, Payoneer has no startup or monthly fees. Payoneer has very low rates for e-check and bank transfer payments. It is also free for Payoneer users to send funds to each other.

However, there is a flat $1.50 fee to withdraw funds from Payoneer. If you need to convert funds to your local currency, you will pay up to 2% above the mid-market rate for that conversion.

Payoneer Features

Payoneer lets you request payments and make payments in multiple currencies. It works with service marketplaces including Upwork, Airbnb, and Fiverr. Payoneer also has currency exchange services. These features make it a popular financial service solution for Airbnb hosts, freelancers, and consultants with global clients.

However, Payoneer is not a merchant account provider or a traditional payment processor. So, it does not have a POS system or any way to accept payments in-person. It also does not have a virtual terminal or payment gateway option.

What Payoneer Is Missing

If you are looking for a PayPal alternative for an ecommerce site or to accept in-person payments, Payoneer cannot do that as it is not a merchant service provider. Payoneer also has account inactivity fees, so it is not a good fit if you only need to transfer or receive funds occasionally.

Payoneer Reviews

Overall, reviews for Payoneer are positive. Reviewers like that it is easy to use, and that payments between Payoneer accounts are free. Users also like that it is easy to deal with multiple currencies. User complaints are around account inactivity fees, annual fees, and poor quality customer support over the phone.

Dwolla: Affordable PayPal Alternative for ACH Payments

Dwolla is a bank transfer and e-check platform for individuals and businesses. Similar to Stripe, Dwolla focuses on custom checkout solutions. However, Dwolla does not work with credit or debit transactions—only bank transfers, making it a good PayPal alternative for online businesses that only accept ACH payments.

Dwolla Pricing

One of the perks of accepting bank transfers or ACH payments instead of credit card payments is that they are significantly less expensive. Dwolla has three plans: Free, Predictable, and Custom. Specific pricing is not available on Dwolla’s website, but third-party review sites report that transaction fees are around 50 cents. Dwolla has no cancellation fees or long-term contracts.

Dwolla Features

Dwolla offers ACH, e-check, and bank transfer payments. The company has an API and offers a custom integration for each business, including white label checkouts. Every account comes with a dashboard to view transactions, see reports, and manage customers. Dwolla also guarantees a 99.9% uptime, so it is a very reliable service.

Dwolla only offers bank transfer payments, not card payments. Bank transfers and ACH take much longer to process, so funds from Dwolla are typically available in five business days. This is very different from card transactions with PayPal, which are available in one or two days in your bank account, or instantly in your PayPal account.

What Dwolla Is Missing

Dwolla does not have many of PayPal’s features, including peer-to-peer payments, a POS app, in-person payment processing, or even the option to accept credit card payments online. It’s also not as easy to set up as PayPal, as Dwolla requires a custom integration. If you need any of these features, Dwolla is not a good fit for you.

Dwolla Reviews

Dwolla user reviews are positive. Reviewers say that it is easy to integrate into any site and that the while label custom checkout features are a plus. Negative reviews cite limited features and difficulty reaching Dwolla’s customer support, which is available by ticket, email, and phone.

Google Pay: PayPal Alternative for E-wallet Checkout

Google Pay is an e-wallet payment solution that offers one-click checkouts. Plus, Google Pay is free for debit and bank transfer transactions. Part of what makes PayPal a great processor is the name recognition and easy checkout. Google offers the same benefits for customers and businesses, making it a great online PayPal alternative.

Google Pay Pricing

Google Pay is a very inexpensive service for both businesses and individuals. For online payments, there are no fees for bank transfers or debit payments. Peer-to-peer payments are also free. Google Pay does not actually process transactions like PayPal can. It simply stores payment data for customers and passes it along to the merchant at checkout.

*Funds are available in your PayPal account immediately.

Google Pay Features

Google Pay is a fast and easy payment method for online, in-store, and in-app transactions for customers who have payment methods saved to their Google account. Google is not a payment processor. Rather, Google allows customers to store their payment information—bank accounts, debit and credit cards, and even PayPal accounts—which can then be used to pay at checkout with businesses that have Google Pay set up.

Google Pay is similar to the PayPal button at online checkouts because it is just as easy for customers to pay with a single click or fingerprint verification. With Google Pay, there is no need to type in credit card information, which makes checkout easier. Google Pay also supports free peer-to-peer payments for debit cards and bank transfers.

What Google Pay Is Missing

Google Pay is mostly a consumer convenience, and therefore does not have the business management features PayPal does, such as a POS app, reporting, or even traditional credit card processing. Google Pay supplements a payment processor in the same way PayPal accepts PayPal payments in addition to traditional card payments.

Google Pay Reviews

Google Pay user reviews are extremely positive. It’s very easy to use and consumers like that Google Pay reduces the need to carry physical cards or type in card numbers at checkout. For businesses, accepting Google Pay can help increase conversions, just like any other e-wallet solution. Some reviewers say that transactions made through Google Pay can look strange on their bank statements, and that it can be difficult to find a phone number for live customer support.

Bottom Line

The best PayPal alternative for your business depends on your payment management needs. However, if you are a business, you likely need online and in-person payment processing, a POS solution, and reporting, all in an easy-to-use system.

Square is the only PayPal alternative that provides all of these features without any monthly fees. Square matches PayPal’s multichannel sales capabilities and even beats PayPal in several areas, including a full-featured POS system and free online store. To see all that Square can do for your business, visit Square to open a free account.

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