Stripe vs Square: Which Payment Processor Is Best in 2022?

Flexibility gives Stripe the edge when it comes to online payment processing. Square falls behind Stripe’s breadth of technology developed for accepting online payments—such as its optimized hosted payments features and dynamic, machine learning-based, customizable payment authorization. Also, while Square offers a free, native website builder function, Stripe offers a wide variety of pre-built integrations, plug-ins, and partnerships with popular ecommerce platforms.

Stripe can easily handle heavier online transaction volumes as it provides powerful functionalities to secure payment processing with its more fine-tuned range of fraud detection tools and customizable risk management features. (Source: Stripe)

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Square offers a simple, free native website builder function. (Source: Square)

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Use Square when you want a simple, complete sales system for your brick-and-mortar business with a handful of third-party sales channels, including social selling for expanding into online sales. It’s easy to work with, so it’s best for those needing just a basic ecommerce setup. Square also uses machine learning risk evaluation, updated from its own pool of data coming from Square transactions across the world. It’s free, but not as customizable as Stripe.

Square comes with a free, easy-to-use website builder as well as a simple integration for various ecommerce platforms. (Source: Square)

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Stripe is better for customizations that require coding skills. (Source: Stripe)

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Square is a user-friendly, one-stop shop for online or in-person sales. Its POS system works for mobile or PC, and you can sync inventories between your online store and your brick-and-mortar store. The POS system works for both retail and restaurants. While Stripe requires you to build your POS using its tools, Square comes ready to populate with your business-specific information.

It also has tools for customer relationship and business management (some require Plus programs or additional fees). Stripe’s app, on the other hand, is only for business management and works primarily through third-party apps and POS providers. It also doesn’t have an offline mode, so it’s not ideal if you run a food truck business or participate in farmer’s markets and trade shows.

Square In-person Hardware Solutions

Square Reader for Magstripe	Square Reader for Contactless and Chip
First free, additional $10	$49
Mobile card reader best for simple swipe transactions	Mobile card reader best for EMV and contactless payments

Square Stand for Contactless and Chip	Square Terminal	Square Register
$149 or $14 per month for 12 months	$299 or $27 per month for 12 months	$799 or $39 per month for 24 months
Best for businesses looking for a simple countertop setup using an iPad and mobile card reader	Stand-alone mobile POS best for taking orders, accepting payments and issuing receipts around the store	Full touch-screen POS with customer-facing display best for encouraging customer engagement

When you use Square, you’re locked into its built-in payments processor (Square Payments). Stripe is the best in-person payment alternative if you prefer to use a different POS system like Lightspeed or Shopify. Also, if you primarily handle large-ticket invoices, such as wholesale or B2B sales, you’ll get better rates with Stripe.

Stripe In-person Hardware Solutions

BBPOS WisePOS E	Stripe Reader M2
$249 (optional dock $49)	$59 (optional dock, $19)
Mobile card reader with built-in POS application best for online businesses selling in person at farmers’ markets and trade shows	Mobile card reader best for accepting EMV and contactless payments both on-the-go and countertop setup

Customization is key for Stripe’s advanced security features. Aside from built-in PCI compliance, chargeback protection, and dispute management, it has developed payment, hardware, and account protection tools that go beyond the standard. For instance, you can customize your acceptable payment risk by setting your own risk level scores. It also offers secure data migration, so you can safely transfer transaction details and customer payment information to and from different payment processors.

If you sell globally, you can use a variety of online identity verification options because Stripe can recognize IDs from over 33 countries. You can also manage all your registered card readers from a central fleet management dashboard.

Stripe’s highly customizable security features allow you to design fraud detection and multiple risk-level rules based on your specific business needs. (Source: Stripe).

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Square’s risk management features are not basic but rather best for securing a broader range of payment processing functionalities. (Source: Square)

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If you are a small business or do not handle large-ticket sales, Square would be the better choice. It gives you standard security tools for handling online and in-person transactions and an option for advanced risk monitoring features that starts at 6 cents per transaction. This provides you with additional protection such as card, email, and IP address blocking, 3D secure authentication, and card processing overrides.

Square also waives chargeback and dispute fees and offers chargeback protection. However, chargeback protection for transactions is capped at $250 per month, which is why Square’s security is more ideal for small businesses.

Square offers an easy-to-use dispute management dashboard for tracking and responding to claims conveniently within the platform. It’s designed to efficiently handle online and in-person small ticket transactions.

Square offers an easy-to-use dispute management dashboard for tracking and responding to claims conveniently within the platform. It’s designed to efficiently handle online and in-person small ticket transactions. (Source: Square)

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Stripe offers a detailed handling of details for each disputed transaction while also automatically updating risk management settings. (Source: Stripe)

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With over 700 partner apps, Stripe is a clear leader in payment processing software for integrations. You can search for apps by name or use the menus to narrow them down by industry, need, and location. You’ll find popular apps like Salesforce, Harvest, Shopify, QuickBooks, and Eventzilla.

If you need to create your own app, Stripe offers API support with documentation, video tutorials, and live chat with developers through Freenode IRC. You can build, test, and manage your integration from your terminal through its CLI. Its Visual Studio Code extension lets you generate sample code, view API request logs, forward events to your application, and use Stripe within your editor.

Stripe’s range of integration lists hundreds of apps to support simple and complex integration options, which are designed to help users create a highly customizable payment and point-of-sale system. (Source: Stripe)

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Square offers 150 POS integrations. (Source: Square)

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If you need easy-to-use, industry-specific integrations, then Square is your best choice. Square is no slouch when it comes to integrations, working with 150 apps in its Marketplace. It’s easy to find apps by searching the categories, or if you know the name, type it in the search bar. Square also creates collections of recommended apps for specific purposes that you can browse. You’ll find integrations with popular software like QuickBooks, BigCommerce, Zoho, and Mailchimp. Some have free plans or free trials.

Square also has a strong API program, with a sandbox for testing, documentation, and SDKs. There’s a forum for reaching out to other developers or contacting support via Slack or an online form. While Square also makes it easy to connect to other software, it’s hard to compete with

Stripe’s 700+ partner apps and famous developer-friendly platform.

Square’s suite of integrations is more targeted toward running a complete point-of-sale system, with emphasis on back-office management and industry-specific tools. This makes Square a better option for smaller businesses that want a simpler way to streamline their business processes.

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Note that Stripe can be used with other POS systems, which would have their own sets of POS features. Stripe integrations are primarily composed of back-office management tools. (Source: Stripe)

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Square is both easy to set up and use. You can immediately start taking payments once you have successfully set up your account, and if you don’t have a Square card reader yet, you still accept payments from your virtual terminal using a browser. This means you can open your store and start selling and processing card transactions with just your laptop or desktop.

The platform is also an all-in-one business solution. You get a payment processor, inventory, and operations management tools with your Square account. If you want to start selling online, Square’s built-in website builder is free and can get you started in minutes with its easy drag-and-drop design tools.

Square Operations Management Tools

• Product catalog: Variations, inventory tracking, low-stock alerts, reports, barcode scanning
• Customer management: Customer information and purchase tracking, loyalty features, marketing
• Employee management: Time clock, permissioning, can add on Square Payroll and Team Management

While both Square and Stripe can be set up in minutes, Square is best for small businesses looking for a complete line of point-of-sale management features. (Source: Square)

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Stripe lacks built-in back office management functionalities you would find immediately available to you on Square once you complete the signup process. (Source: Stripe)

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If you have a business dealing mostly with online sales, accepting international payments, and processing large-ticket transactions, including B2B sales, then Stripe’s high-level security infrastructure will be better suited for you. You will need to hire someone with the technical skills if you want to customize your payment setup, but Stripe also has plug-and-play integrations and checkout templates for simpler payment processing.

What’s good about Stripe is that its products are well documented and it provides 24/7 phone and email support, so you can get all the help you need. Its long list of integrations also includes operation management tools to support your business, though it’s not as extensive as Square.

Stripe Operations Management Tools

• Product catalog: Custom build available in POS or use third-party integrations
• Customer management: Basic customer data collection that includes customer-facing sign-up forms for card-on-file transactions
• Employee management: Available from third-party apps

Stripe makes accepting online and international sales an easy task with its wider range of payment processing options. This broad range of payment methods is matched by a highly customizable risk management feature to make transactions more secure. (Source: Stripe)

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Square also offers a suite of payment methods that’s easy to setup although it does not offer the level of customization that’s available in Stripe. (Source: Stripe)

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