Stripe vs PayPal: Which Online Payment Processor Is Best?
This article is part of a larger series on Payments.
Both Stripe and PayPal are excellent online payment processors. We like Stripe for international sales, B2B businesses, and larger companies. PayPal is great for small businesses, solopreneurs, and as an additional payment method to any website or online store.
- Stripe: Best for tech-savvy startups and growing ecommerce businesses, B2B sales, and international sales
- PayPal: Best for small or casual retailers and those needing an additional payment option
They both made our list of the best online payment and credit card processors. Stripe took the top spot with an overall score of 4.39 out of 5, while PayPal received 3.84 out of 5. Both Stripe and PayPal can also accept in-person payments and offer POS terminals and card readers.
When to Use an Alternative: Helcim
High-volume businesses might find Helcim a better option with its zero monthly fees, interchange-plus pricing, automatic volume discounts, all-in-one hardware, and an option to opt for ACH payments or pass-on credit card fees for bigger savings. automatic volume discounts. Plus, all of Helcim’s tools are free to use. Visit Helcim to learn more, or see how it compares below.
Stripe vs PayPal Quick Comparison
 |  |  | |
|---|---|---|---|
4.39 out of 5 | 3.84 out of 5 | 4.04 out of 5 | |
Best for | Online sales International markets | Small or casual retailers Additional payment choice | Saving on processing fees |
Monthly fee | $0 | $0 | $0 |
Transaction fees | Simple flat rates 2.9% + 30 cents | More complex Ranges from 1.9% + 10 cents to 3.49% + 49 cents per transaction | Interchange plus pricing Interchange plus 0.15% + 1 cents to 0.5% + 25 cents |
Average payout time | Instant payout for 1% (min 50 cents) Standard 2 business days | Instant to PayPal account or 1.5% fee to bank/card (max $10) Standard 1–5 business days to bank | 2 business days |
Online payments | Ecommerce integration, mobile apps, CRM software, and more | Ecommerce integration, mobile apps, CRM software, and more | Checkout pages, online store, invoicing, virtual terminal, and integrations through API |
Integrations | 710 | Over 1,000 | Limited pre-built integrations, API and pre-built payment flow documentation available |
Virtual terminal | Free* | $30 per month | Free |
Ease of use | Good | Very Good | Very Good |
Volume discount | ✓ | ✕ | ✓ |
Micropayments | Upon request | Built-in | No |
Customer service |
|
| Monday-Saturday phone support, online knowledgebase |
Overall Score:
4.39 / 5
Pros
- Highly customizable, extremely flexible, secure platform
- Hundreds of integrations and powerful, well-documented APIs
- Low-cost ACH processing
- 135+ currencies
Cons
- Service fee for invoicing and recurring billing payments
- Requires some technical expertise
- Add-on fees for other services
- Built-in virtual terminal for emergency use only
Stripe Is Best For
- Creating a fully customizable and secure checkout: Stripe comes with customizable security features for checkout carts and the assurance of strict PCI (Payment Card Industry) compliance in its free account.
- Fast-growing ecommerce businesses or service providers: Businesses with software developers can scale their checkout process using reliable APIs and integrations.
- Local and international B2B businesses: Stripe accepts international transactions for over 135 currencies and processes extremely small and large payments. It handles recurring billing, invoicing, and domestic ACH transactions. Stripe tops our list of best international merchant account providers.
Overall Score:
3.84 / 5
Pros
- Seamless online checkout integration
- Known and trusted platform by consumers
- Instant deposits into your PayPal account
- Discounted processing fees for nonprofits
Cons
- Unpredictable freezing of funds
- Expensive for international payments
- Monthly fee for virtual terminal and recurring billing
PayPal Is Best For
- Quickly adding online payments to your business: Provides a simple and easy way to add payment options on your checkout page with secure payment buttons.
- Boosting online conversions: PayPal has one of the most trusted security seals in the payments industry.
- Getting paid on various online platforms: While PayPal often has one-click integration with many ecommerce platforms, it also offers easy-to-use “buy now” buttons for social media and hosting for product information, making it easy to sell on social media without an ecommerce platform.
Get a Personalized Recommendation
If you’re looking for a more specific solution, both Stripe and PayPal frequently make our lists of the following:
Stripe vs PayPal Pricing & Contract
| | |
|---|---|---|
3.38 out of 5 | 3.38 out of 5 | |
Monthly ecommerce subscription | Varies (third-party) | $0, $25/month for use of payment gateway |
Ecommerce transaction fees | 2.9% + 30 cents | 2.59% + 49 cents |
Virtual terminal transaction fees | 3.4% + 30 cents | 3.09% + 49 cents |
ACH transaction fees
| 0.8%, $5 cap | Echecks: 3.49% + 49 cents, $300 cap; ACH: Upgrade to Braintree |
Invoice fee | 2.9% + 30 cents plus 0.4%–0.5% per invoice, depending on plan | 3.49% + 49 cents plus $10–$30/month for recurring billing/payments |
Chargeback fees | $15 | Chargeback: $20 US (varies by country) Dispute: $15 US (varies by country) |
Special pricing for nonprofits | Custom, discounted | 1.99% + 49 cents (charity) 2.89% + 49 cents (donations) |
High-volume discounts | Offers custom rates | None |
Stripe vs PayPal Calculator
Compare Stripe vs PayPal fees. Enter an estimate of your monthly sales data in the calculator below:
Stripe vs PayPal Payment Types
| | |
|---|---|---|
4.63 out of 5 | 3.88 out of 5 | |
Payment types | Credit card, debit card, digital wallets, ACH, gift cards | Credit card, debit card, digital wallets, echeck, digital gift cards, crypto, Venmo |
Ecommerce payment tools subscription | Varies (third party) | $0, $25/month for payment gateway |
Online transaction fee | 2.9% + 30 cents, plus, $0–$2/active user/month | 2.59% + 49 cents |
Virtual terminal | Free | $30 per month |
Invoiced payments fee | 2.9% + 30 cents plus 0.4% with 25 free invoice processing per month, or 0.5% per invoice, depending on plan | 3.49% + 49 cents |
Recurring payments and card on file fee | 2.9% + 30 cents plus 0.5% per month or 0.8% per invoice, depending on plan | $10 gateway fee + 3.49% + 49 cents per transaction |
ACH and eCheck | 0.8%, $5 cap | No ACH Echecks: 3.49% + 49 cents, $300 cap |
International payments | 135 currencies, 1.5% fee, 1% spread for currency conversion | 24 currencies, 1.5% fee, 4% spread for currency conversion |
Buy buttons | Stripe Payments | PayPal button generator, PayPal standard integration, PayPal advanced integration |
Social selling | Stripe Payment Link, Stripe Connect | Payment link, Seller Profile for personal PayPal accounts |
Buy Now, Pay Later | Affirm, Afterpay, Klarna | PayPal Pay Later (Pay in 4, Pay Monthly) |
Tap to Pay on iPhone | ✓ | ✓ |
Ecommerce integrations | 239 | 33 online stores, 18 marketplaces, 17 website design systems, shipping label tools, and many others not mentioned on the website |
Micropayment fee | 5% + 5 cents* | 4.99% + 9 cents or applicable standard transaction rate |
*Must contact Stripe to apply for a custom microtransaction rate.
Both Stripe and PayPal are focused primarily on online payment solutions, but their best features are directed to different user types.
If your online business regularly handles large-volume transactions for local and international customers, such as B2B, Stripe is the better option. While it requires third-party integrations for ecommerce and multichannel tools, Stripe is more flexible and customizable. It supports more currencies and charges less for currency conversion compared to PayPal.
Stripe’s hosted payment page optimizes the checkout experience for international customers. (Source: Stripe)
Stripe stands out for invoicing and recurring payments. The flat rate plus service fee is still slightly lower than that of PayPal, which also charges $10 for the use of its recurring billing service and another $30 to access recurring billing tools, on top of a gateway fee. Stripe accepts ACH debit and credit payments with fees ranging from $1–$5 per transaction, while PayPal e-check fees for invoices cost 3.49% + 49 cents, capped at $300 per transaction.
Aside from the lower fees, it also offers a variety of customization options for one-time and recurring transactions. Stripe features a simple invoicing tool you can set up from your dashboard. Alternatively, you can use its API for more advanced features that allow you to automate the collection, tracking, and reconciliation of your invoices.
For subscription-based businesses, you can use Stripe Billing, which lets you create a variety of subscription models—whether it’s per-seat or metered, flat-rate, or usage-based. You can customize it further by adding coupons, free trials, prorations, add-ons, and other options. Once your customer selects their preferred plan, you can automatically generate a corresponding invoice with Stripe invoicing.
Create Stripe also offers hosted invoices in minutes with no coding skills required. (Source: Stripe)
Based on the information provided on Stripe’s website, microtransaction payments are not available for all types of markets, and it’s best that you contact Stripe Support for more information. However, you will likely get better rates with Stripe if you have an active business that processes micropayments regularly.
With Stripe, you can also batch multiple payments from a single person into one charge to mitigate transaction fees, which could be helpful if you accept lots of micropayments from a small number of people.
PayPal is the better choice for smaller businesses with occasional online sales, such as hobbyists or those that only need an online payment option for some of their customers.
PayPal provides payment flexibility, with Venmo and cryptocurrency on its list, plus built-in Buy Now, Pay Later, PayPal Credit, and Pay Monthly options to encourage more customers to buy (Stripe integrates with Afterpay to offer its own Buy Now, Pay Later payment method).
PayPal offers better payment options for your customers, such as Buy Now, Pay Later, PayPal Credit, and Pay Monthly, encouraging more sales and increasing revenue. (Source: PayPal)
When it comes to micropayments, PayPal gets the edge. It offers a dynamic transaction fee method for accepting micropayment transactions. On the other hand, you need to contact Stripe to check if you are eligible for their custom micropayment rate, which is typically quoted at 5% + 5 cents for transactions under $5.
PayPal also has more methods for accepting micropayments, supports peer-to-peer transactions, and provides easier access to your funds.
With Dynamic Micropayment pricing, merchants who have frequent transactions valued at $26.67 or lower get better rates. (Source: PayPal)
Use PayPal if you need to send out local invoices on occasion and if you prefer receiving e-check payments over ACH. PayPal’s tools are easy to use, and the PayPal for Business app lets you create professional invoices and schedule send-out requests for recurring transactions from your mobile phone with a few clicks. It creates a link, which you can then send to your customers via email or messaging.
PayPal shows you a list of your customers, their transaction history, and the status of their invoices. (Source: PayPal)
Stripe vs PayPal Account Features
| | |
|---|---|---|
4.63 out of 5 | 3.63 out of 5 | |
Bank deposit speed | 2 business days, first deposit takes up to 14 days | Approximately 3 business days |
Instant deposit | 1% of payout volume | 1.5% of payout volume |
Chargeback protection | 0.4% per transaction | 0.4% per approved transaction |
Dispute fees | $15 | $15–$20 |
Dispute management tools | Included | Included |
Advanced risk monitoring | $0–7 cents per transaction | With an upgrade to PayPal Enterprise |
Payment security features | Payment data encryption Built-in machine-learning fraud detection Customized payment risk evaluation 3D secure authentication Secure data migration Online identity verification | Email confirmations PayPal Security Key TLS connection Key pinning Data protection Machine-learning fraud detection technology |
API | Yes | Yes |
Developer tools | CLI, Visual Studio Code, live event monitoring, advanced SDKs | API executor, multiple languages, interactive mode, or mock mode |
Developer support | Documentation, YouTube tutorials, newsletter, live chat with developers, 24/7 support | Documentation, updates, demos, developer community, FAQ, live support via ticket |
PCI compliance | Included | Included |
Customer service | 24/7 chat and phone support, email, resource library | Extended phone support, active seller community, help center, text messaging and social media customer support |
Both Stripe and PayPal offer significant security for online payments, but Stripe provides more customization, including identity verification. Both charge the same amount for chargeback protection. The dispute fees for both are non-refundable, but this fee is generally lower for Stripe.
Stripe is miles ahead when it comes to online payment security and has built a robust infrastructure for monitoring tools to protect your transactions. It provides advanced machine-learning fraud detection features and allows you to customize your acceptable payment risk level, so you won’t miss out on sales that regular fraud monitoring tools might rule as suspicious and block the transaction.
Real-time risk assessment is also central to Stripe’s chargeback protection features. Its Dynamic 3D Secure tool is built-in on every checkout page and screens medium-risk buyers to protect any business size from potential disputes.
Your Stripe dashboard keeps a record of disputes and helps you track and manage them. (Source: Stripe)
Stripe is the better option if you want a more customized payment solution for your business. B2B businesses that deal with large volumes of international transactions will require a more sophisticated fraud detection system to minimize risk and provide maximum seller protection—and Stripe provides this.
Stripe offers one of the most extensive integrations among payment processors. It also provides many plug-and-play integrations, including access to its invoicing and recurring billing tools, and is compatible with many popular POS and ecommerce software.
Stripe Dashboard provides you with links to set up a range of payment methods with different customization options. (Source: Stripe)
While PayPal is integrated into just about any retail application you can think of, Stripe takes the lead for integrations because of its app marketplace and developer tools.
Stripe offers over 700 partner apps, and it’s very easy to find them on its website. 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.
Can’t find the app you need? Stripe offers excellent API and SDK support with documentation, video tutorials, and live chat with developers through Freenode IRC. Build, test, and manage your integration from your terminal through its CLI. Use the Visual Studio Code extension to 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)
Stripe offers 24/7 email, phone, and chat support. There is also a comprehensive knowledge base and detailed API documentation.
Consider PayPal if your customers are primarily domestic and mostly PayPal account holders as well. This ensures that your transactions are covered by PayPal’s Seller Protection policy. Also, while Stripe provides more sophisticated payment security features, PayPal is still one of the most trusted security seals in the payments industry, making it an ideal choice if you’re trying to boost sales.
PayPal provides seller protection for an unlimited number of transactions, provided each transaction meets eligibility requirements. (Source: PayPal)
Signing up for Stripe and PayPal is free, and both can be set up in minutes. PayPal is ready to use, while you will need some level of technical skills if you want to thoroughly take advantage of Stripe’s payment and security features. PayPal customer access to support is also broader (though you may encounter difficulties reaching a live person over the phone), and it lists thousands of integrations for a variety of functions.
With PayPal, you usually need fewer third-party integrations, and if you do, PayPal offers plug-and-play integrations, so you can easily add PayPal checkout to any website and online marketplace. Although PayPal offers integrations with thousands of shopping and mobile applications, from eBay to Facebook, that’s from the consumer’s POV.
Businesses will have a harder time finding integrations when looking from the PayPal page. The app center is focused on PayPal apps, with only a handful of third-party apps listed. When using the search bar, it does not pull up apps that we know work with PayPal—QuickBooks, for example. It may be easier to look at your other software and see if it has a PayPal API.
You can set up your PayPal business account in minutes and get quick links to easily create payment methods and options. (Source: PayPal)
PayPal has native apps for adding pay buttons, processing subscriptions, invoicing, or accepting money casually. It also has native apps for digital advertising, messaging customers, offering digital gift cards and discounts, and fundraising, to name a few.
It even has developer programs for marketplaces and enterprise-level businesses. It offers documentation on existing APIs, a sandbox for development and testing, and a community for support. Live tech support is by ticket only.
PayPal has a user-friendly development section on its website (Source: PayPal)
While PayPal’s phone support is limited, it has an active seller community that provides almost every answer for using PayPal, along with access to customer service via text messaging and social media.
Stripe vs PayPal Expert Score
We scored this category based on our own experience of ease of use and how affordable and transparent the pricing is. We also looked at the number and ease of integrations, as well as the input of real-world users as recorded in third-party user review sites like Capterra and G2.
Methodology—How We Evaluated Stripe and PayPal
We test each online payment processor ourselves to ensure an extensive review of the products. We then compare pricing methods and identify providers that offer zero monthly fees, pay-as-you-go terms, and low transaction rates. Finally, we evaluate each according to various payment processing features, scalability, and ease of use.
The result is our list of the best online and credit card processors. However, we adjust the criteria for specific use cases, such as for different business types and merchant categories. This is why every online payment processor has multiple scores across our site, depending on the use case you are looking for. For this in-depth analysis, we looked closely at how Stripe and PayPal performed.
Click through the tabs below for our overall online payment processor evaluation criteria:
20%
Pricing
30%
Payment Types
25%
Account Features
25%
Expert Score
20% of Overall Score
We graded based on monthly fees, online rates, chargebacks, and whether or not you could get volume discounts.
Both Stripe and PayPal scored 3.38 out of 5 in this category, getting excellent scores for not having any contract or monthly fees. Despite PayPal having a more complex pricing schedule, their processing rates are both competitive enough to put them on equal footing in this category.
30% of Overall Score
Online payments are more than website checkouts. We looked for invoices, recurring billing, and virtual terminals. We also gave points for stored payments and Level 2 and 3 processing for B2B sales.
Stripe had a clear lead with 4.63, while PayPal only received 3.88, mainly because of the monthly fees it charges for its virtual terminal and recurring payments.
25% of Overall Score
This score considered sales tools like customer management features, BNPL, fraud prevention, and developer tools for customizations. We also considered deposit speed, giving the most points for same-day processing and customer service.
Stripe again took the lead with 4.63 out of 5, while Paypal lagged with 3.63. Among the criteria that Stripe did better than PayPal are customer support, fraud prevention, and developer tools.
25% of Overall Score
Here, we scored based on our own experience of ease of use, plus research into account stability. The number and ease of integrations contributed to this score. Finally, we gave some weight to the input of real-world users as recorded in third-party user review sites like Capterra.
Stripe earned a slightly higher score of 4.69 out of 5, while PayPal earned 4.38 because Stripe has a slightly more straightforward set of fees.
*Percentages of overall score
Stripe vs PayPal Frequently Asked Questions (FAQs)
Stripe is known for its ability to provide a range of customization options for different types of payment methods. While it does support simple hosted payment links, Stripe stands out for its level of customization, including payment security and fraud detection features. This is made possible through higher-level coding, which Stripe makes available through APIs.
PayPal and Stripe are outstanding choices for online payment processing. However, PayPal is ideal for low-volume, seasonal, small businesses. It charges cheaper in-person transaction fees and supports peer-to-peer payments like Venmo. Stripe is the better option for merchants with regular monthly sales, especially for B2Bs.
Stripe is cheaper than PayPal for processing international payments and accepting online transactions, which makes it the best option for B2Bs.
Bottom Line
There is no clear winner in the debate of PayPal vs Stripe. Both are excellent options when choosing an online payment processor. While Stripe scored higher overall, PayPal still makes a good addition because it is a trusted service, expands your payment processing capabilities, and has no additional fees if it’s not used regularly. Even if you have your own payment processing service or choose to go with Stripe, PayPal is still good to include as an alternative.
