Which is better? PayPal vs Stripe

Which is better? PayPal vs Stripe

PayPal is known for being the most popular payment service available out there. In 2010 with the launch of Stripe the choice stopped being so obvious. Although solutions like Amazon Pay, Apple Pay or Google Pay are emerging day by day, for many companies the choice is still between PayPal and Stripe.

Fees and micropayments

To compare the two we should start with establishing what are the transaction fees for those solutions. In the United States, both Stripe and PayPal charge the same amount of money for a successful transaction, which is 2.9% plus 30 cents. Those fees can vary depending on the country the trading happens in, but in this case, both of the services are basically the same. However, Stripe does not charge any additional fees for international cards while PayPal has an international fee of 3.9% plus a fixed fee. Both of them charge nothing for failed transactions or performed refunds. American Express cardholders have it better with Stripe, since there are no charges there, while PayPal has the fee of 3.5%. It is also worth mentioning the types of payment accepted by both services. PayPal accepts payment methods like:

  • PayPal
  • PayPal Credit
  • Credit cards
  • Debit cards
  • Pay by phone

While Stripe accepts the following:

  • Credit cards
  • Debit cards
  • International Cards
  • American Express
  • Masterpass by MasterCard
  • Visa Checkout
  • WeChat Pay
  • AliPay
  • Apple Pay
  • Google Pay
  • ACH credit and debit
  • Sepa direct debit

and there is even more!

Another thing to consider while choosing a payment service is how they handle micropayments. Stripe applies standard rates for the transactions while PayPal offers 5% plus 5 cents per transactions that are under $10 therefore, the former is a better choice if your company performs a lot of low-cost sales.

Access to payments with PayPal is granted after 3 to 4 days when Stipe allows its users to gain access to the US payments on a two-day basis while the international transactions are handled within 7 days. This is why the countries you trade with should be taken into consideration here. The advantage of PayPal here is that it keeps all the business transactions separate as well as offers name recognition. An option to think about is to make use of both of those services and encourage your clients to choose one or the other depending on their localization. Additionally, Stripe handles processing of over 135 currencies while PayPal can only take care of 25 of them, but PayPal works well in over 200 countries and Stripe accepts payments from users in only 25 countries.

What about the setup?

Next thing here is the setup process. Starting with PayPal with basic examples it can be extremely easy. There is an option to add a payment button that can be set up through admin panel and all you have to do after that is to copy and paste a few lines of code onto the website. Unfortunately, with more tailor-made solutions you have to hire a developer or you have to know how to code. With Stripe you do not have the easy option. Here you will probably need a developer to handle the implementation process since the solution was built with developers in mind. If you do not have a free developer in-house, maybe weighing out the pros and cons of using Stripe revenue-wise will be helpful in the decision-making process.

How’s the UX?

What is more, the UX of the chosen service is very important. Some say that the user experience of PayPal is quite disappointing since it lacks mobile browsing and has quite a challenging navigation. Stripe’s API seems to be the better option here, but the fraud protection is not that great. As a well-known brand, PayPal seems to have gained the consumers’ trust. Also, if you decide not to use the paid version of PayPal (Advanced or Pro) your customers will be redirected to the PayPal main page, therefore, leaving yours. With Stripe the checkout happens on your website, which gives a better overall user experience.

3rd party solutions

You may also be interested in stuff like 3rd party integrations. This is where Stripe dominates. Here PayPal is quite minimalistic, integrating with platforms like WooCommerce, Salesforce or QuickBooks - which is honestly all a business could need. Stripe, however, has categories to the possible integrations. You can choose from: customer support, CRM, eCommerce, Form Building, Email Marketing, Inventory Management and many more. If this is what is important to you, Stripe is a definite winner.

Summary

When considering which service is the best fit for your company you need to evaluate the actual needs of your business. Whether you make a lot of international trading or not will have the biggest influence on which one you will choose. However, the final decision does not have to be an either-or. You can comfortably run both Stripe and PayPal to get the most of both of them and establish your business as the one that knows the newest technology solutions for payment management.

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