Stripe vs Square: Which Payment Processor Is Best in 2022?
Meaghan has provided content and guidance for indie retailers as the editor for a number of retail publications and a speaker at trade shows. She is Fit Small Business’s authority on retail and ecommerce.
Anna’s experience in business and finance led her to work for a US risk mitigation company in Singapore. She has contributed to POS and payments topics in the Retail section across Fit Small Business.
This article is part of a larger series on Payments.
Stripe is a developer-friendly payment processing solution best for online businesses wanting to add a customizable checkout to their websites or sales applications. Square is an out-of-the-box point-of-sale (POS) and payment processing platform that’s best for small businesses needing an all-in-one solution.
When comparing Stripe vs Square, the main difference is Stripe requires technical knowledge and needs to be installed on a separate website or app to accept payments. Square requires no technical skills and offers a free POS system and website that has Square payment processing automatically built in.
- Square: Best for individuals, brick and mortar businesses, and basic online sales
- Stripe: Best for tech-savvy startups and growing ecommerce businesses, B2B, and international sales
Stripe vs Square Quick Comparison
 |  | |
Best for | Businesses focused on online sales and international markets | New or small businesses, brick and mortar shops, businesses on a budget |
Monthly fee | $0 | $0 |
Processing fee | 2.9% + 30 cents per transaction | 2.6% + 10 cents to 3.5% + 15 cents per transaction |
Invoice fee | 0.4% with 25 free invoice processing per month or 0.5% per invoice, depending on plan | 2.9% + 30 cents or 3.5% + 15 cents if processed using Card on File |
Average payout | 2 business days, per a schedule you set; instant payout for 1%, minimum 50 cents | Free 1–2 day funding; instant funding for 1.5% |
Online payments | Integrate with eCommerce, mobile apps, CRM software, and more | Square Online store, payment links, add checkout to an existing site, Facebook, Instagram, virtual terminal |
POS features | Custom build or connect to existing POS | Basic POS is free; advanced available starting $60/month |
POS Hardware | Offers pre-certified card readers only | Full suite of products and accessories; compatible with third-party devices as well |
Integrations | 710 in areas of payments, operations, marketing, and finance | 710 in areas of payments, operations, marketing, and finance |
International currencies | 135+ Additional 1% fee | International cards bearing a Visa, Mastercard, American Express, Discover, JCB, or UnionPay logo (currency conversion fee is charged by the customer’s bank) |
Ease of use | Good | Excellent |
Customer service | 24/7 chat and phone support, email, resource library | Monday–Friday phone support, 24/7 automated chat support, seller community, and resource library |
Takeaway: Stripe is originally designed for online-first businesses and offers more technically advanced options for online payment processing. Square, on the other hand, provides more payment processing and operational management features for brick-and-mortar businesses, including a built-in website builder for those who want to expand to online sales.
Stripe and Square both
- Allow businesses of all sizes to accept online payments
- Provide user-friendly solutions and top-rated merchant services
- Offer average—but not the lowest—transaction fees
- Do not offer the stability of a traditional merchant account
Most Affordable: Square
| | |
Monthly POS subscription | Varies (third party) | $0–$299 with add-on programs |
Monthly ecommerce subscription | Varies (third party) | $0–$72 with add-on programs |
Card reader pricing | $59–$249 | $0–$49 |
Terminal and register pricing | Does not supply terminals | $169–$799 (all-inclusive) |
Card-present transaction fees | 2.7% + 5 cents, 2.9% + 30 cents for touchless | 2.5% + 10 cents to 2.6% + 10 cents |
Ecommerce transaction fees | 2.9% + 30 cents | 2.9% + 30 cents |
ACH transaction fee | 0.8%, $5 cap | 2.9% + 30 cents, plus 1% processing fee, minimum $1 |
Invoice fee | 0.4% with 25 free invoice processing per month or 0.5% per invoice, depending on plan | 2.9% + 30 cents or 3.5% + 15 cents if processed using Card on File |
Chargeback fee | $15 | $0 |
Failed transactions fee | $4 to $15, depending on the type of transaction | $5 to $15, depending on the transaction |
Overall, for affordability, Square beats Stripe. That’s because as a payment processor, Stripe integrates with third-party applications. Even your online store will be third-party—or you’ll use Stripe’s tools to create one to host on your website. Meanwhile, Square offers a free fully functional POS system and online store, with charges for upgrades and additions. Learn more about Square’s pricing and fees.
Stripe may beat Square for ACH transactions and invoices, depending on the dollar amount. For example, if your invoices are generally more than $237, Stripe is the cheaper option. This makes Stripe better for B2B sales, and it tops our list for the best B2B payment solutions.
Best for Online Payments: Stripe
| | |
Ecommerce tools subscription | Buy buttons | $0–$72 with add-on programs |
Invoiced payments fee | 0.4%–0.5% | 2.9% + 30 cents |
ACH Debit/Credit payments | $1/payment (debit) 0.8% capped at $5 (credit) | 1% with a $1 minimum |
Recurring payments fee | ✔ | 3.5% + 15 cents |
Card on file transactions | 0.5%–0.8% | 3.5% + 15 cents |
Virtual terminal | Simple, recurring (third-party integration) | Simple, recurring, autopay |
Hosted checkout | ✔ | ✔ |
Multichannel (eBay, Amazon) | ✔ | ✘ |
Buy buttons | ✔ | ✔ |
Social Selling | Third-party integration | ✔ |
Ecommerce integrations | 239 | 97 |
In our evaluation of the best merchant services for small businesses, you’ll see that Square ranks higher than Stripe. However, that article takes into account features beyond online payments processing: in-person payments tools and fees, price, POS, and business management features. When looking solely at online payment capabilities, we find Stripe the winner.
Why Stripe Is Better for Online Payments
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.
When To Use Square
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.
Best for In-person Payments: Square
| | |
Payment types | Credit card, debit card, contactless payments, gift cards | Credit card, debit card, contactless payments, gift cards |
Monthly subscription fee | $0 | $0 |
High volume discounts | Offers custom rates | Offers custom rates |
Card-present fees | 2.7% + 5 cents, 2.9% + 30 cents for touchless | 2.6% + 10 cents per transaction |
Mobile payment processing | 2.7% + 5 cents, 2.9% + 30 cents for touchless | 2.6% + 10 cents per transaction |
Payment features | Split tender, discounts, tips, digital receipts, refunds, chargeback protection, international payments | Split tender, discounts, tips, digital receipts, refunds, chargeback protection |
Mobile app | Back-end management, sales processing depends on POS provider | Sales with complete POS and offline mode |
POS Features | Custom build, unifies online and in-store payments, customer management, fleet management tools | Free basic register, inventory, customer management, employee management. Plus plans include advanced features, and add-on programs add more functions |
POS Hardware | Offers pre-certified card readers only | Full suite of products and accessories; compatible with third-party devices as well |
High volume discounts | Offers custom rates | Offers custom rates |
Square beats Stripe for in-person sales because it is designed for accepting in-person payments out of the box. It has a complete POS ecosystem and key integrations, so users can start running their businesses with Square in minutes. Stripe, on the other hand, also developed its range of in-person payments solutions, including card readers, but relies on POS integrations and development in order to start processing transactions.
Why Square Is Better for In-Person Payments
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 farmers markets and trade shows.
Square In-person Hardware Solutions
 |  |
First free, additional $10 | $49 |
Mobile card reader best for simple swipe transactions | Mobile card reader best for EMV and contactless payments |
 |  |  |
$169 or $16 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 to Use Stripe
When you use Square, you’re locked in to 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
 |  |  |
$59 | $249 | $59 |
Mobile card reader best for accepting EMV and contactless payments with your iOS or Android device | 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 |
If you’re looking for a specific type of payments solution, both Stripe and Square often make our lists of the
- Best PayPal alternatives
- Best payment gateways for small businesses
- Best merchant services
- Best B2B payment solutions
- Best free merchant accounts
Best for Security: Stripe
| | |
Chargeback/dispute fees | $15 (refundable) | $0 (waived) |
Monthly chargeback reimbursement | Unlimited | $250 |
Chargeback protection | Included | Included |
Advanced risk monitoring | $0–7 cents per transaction | $0–6 cents per transaction |
Dispute management | Included | Included |
PCI Compliance | Included | Included |
Payment security | Level 1 PCI Compliance Payment data encryption Built-in machine-learning fraud detection Customized payment risk evaluation 3D secure authentication Secure data migration Online identity verification | Level 1 PCI Compliance Payment data encryption Proprietary tokenization Systematic security updates |
Hardware security | End-to-end data encryption Centralized fleet management Automatic updates P2PE-ready | Secure, end-to-end data encryption Platform and network monitoring Automatic updates |
Account protection | Single Sign On (SSO) authentication Custom dashboard roles IdP-initiated login | 2-step verification Multi-level employee permissions Password security evaluation |
Without a doubt, Stripe dominates this category with its wide range of customizable payments, hardware and account security features. On the other hand, Square’s proprietary card readers and payment security features offer standard tools such as Level 1 PCI compliance and end-to-end data encryption.
Why Stripe Is Better for Security
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 Disputes management dashboard includes detailed information and status of every dispute. (Source: Stripe)
Stripe's risk management allows you to customize risk evaluation and settings for all your transactions and set your acceptable payment risk level. (Source: Stripe)
Customized identity verification tools can be programmed to screen international payments, subscriptions, and payouts from over 33 countries. (Source: Stripe)
When to Use Square
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 start 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 assists you in resolving customer disputes with its intuitive dispute management dashboard. (Source: Square)
Best for Integrations: Stripe
| | |
Apps in North America, Great Britain, Australia | 622 | 71 |
International apps | 710 | 150 |
Categories | 28 | 16 |
Industries covered | 10 | 7 |
App marketplace search | Search by need, industry, geographic area or country, search bar | Search by category, collections, search bar |
API | Yes | Yes |
Developer tools | CLI, Visual Studio Code, live event monitoring, advanced SDKs | Sandbox, API explorer, live event monitoring, backend SDKs, secure payment SDKs |
Developer Support | Documentation, YouTube tutorials, newsletter, live chat with developers, 24/7 support | Documentation, forums, Slack, contact support via online form |
Stripe is especially suited for developers, making it a good choice for tech-savvy businesses. While Square also offers APIs and SDKs to create customized in-app and online checkouts, Stripe’s range of apps, tools, documentation, and support is clearly more advanced.
Why Stripe Is Best for Integrations
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 it 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 has a searchable database of over 700 partner apps. (Source: Stripe)
When to Use Square
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.
It has a strong API program as well, 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.
Best for Set Up & Ease of Use: Square
| | |
Minimum account setup speed | Minutes | Minutes |
Application and approval requirements | None | None |
Setup fee | $0 | $0 |
Business type restrictions | High-risk businesses | |
Business management tools setup | Custom-built product catalog Basic customer information Third-party apps for employee management | Built-in inventory management Customer database with available loyalty and marketing add-ons Team management add-ons |
Ease of use | Plug-and-play integrations Ready-to-go checkout templates Third-party platform sign-up option Requires technical and coding skills | Easy sign up Flat-rate transaction pricing All-in-one management platform Easy to use No technical skills required for setup |
Customer service | 24/7 chat and phone support, email, resource library | Monday–Friday phone support, 24/7 automated chat support, seller community, and resource library |
Square is the obvious winner for ease of setup. While both Square and Stripe allow you to create an account in minutes with no upfront cost, Square users can start accepting payments faster because it requires zero technical skills to set up a payment processing flow. With Stripe, on the other hand, you need a third-party integration to create a virtual terminal and understand some basic coding to add a checkout button on your website.
Why Square Is Better for Ease of Use & Set Up
Square is both easy to set up and easy to 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 process 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 along 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, photos, inventory tracking, low-stock alerts, reports, barcode scanning
- Customer management: Customer information and purchase tracking, loyalty features, marketing
- Employee management: Time clock permissioning add-on for Square Payroll and Team Management
When to Use Stripe
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 payments 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
Learn how to set up your business on Square with our ultimate Square POS setup guide.
Bottom Line
When debating between choosing Square vs Stripe for your business, it comes down to one question: Are you a tech-savvy startup or a business owner looking for a user-friendly solution? For tech-savvy startups wanting lots of flexibility, Stripe is best for you. Square offers a plug-and-play solution for accepting payments anywhere, along with a suite of free business management tools that is the better fit for most small businesses.
You May Also Like …
- Learn more about Square in our reviews of Square Payments and Square POS
- See more on Stripe’s pricing and features in our Stripe review
- Read more about merchant accounts and how they work
