Which is Best Payment Gateway for Startups? PayPal vs Stripe

No, no, no….choose that COD option only, you don’t know when and how the fraud will happen. 

Is this what your family tells you while paying for anything that you purchase online? 

Well, I can totally relate, I would like you to know that online transactions have got much safer now. And it’s always not only about making the payment, but it’s also about accepting them. However, many businesses are still ambivalent about the use of online transactions for accepting or making payments. 

So it’s just not us, even the businesses are concerned, good to know, right?

International online transactions always get us worried!

So what’s the best mode to make internal online payments? Got any suggestions?

PayPal vs stripe
PayPal and stripe

Well, I’ve got a few. 

And the legendary PayPal and Stripe are obviously a part of the list.

Are you one of them who is aware of the two but aren’t sure which one to choose?

I was on the same list as you. But then…..I researched, read articles, just what you’re doing now, and found out the answer.

Wanna know what I learned from my research? Let’s see!

So, we all know what PayPal and Stripe are and how they work, now let’s see the difference between them and their other alternatives. 

Stripe vs PayPal

Both Stripe and PayPal have a huge fan base which is obvious given the amazing features they offer. And these great features make it hard to decide which is better, PayPal or stripe.

But we are still gonna have the PayPal vs stripe debate here. 

To know the difference between PayPal and stripe and which is a better choice between the two, we will list all of their major features and see which of the two provides better features.

PayPal vs stripe
PayPal and stripe

PayPal is an American company operating an online payments system in most countries that support online money transfers and serves as an electronic alternative to traditional paper methods such as checks and money orders. PayPal was originally established by Max Levchin, Peter Thiel, and Luke Nosek in December 1998 as Confinity, a company that developed security software for handheld devices

PayPal vs Stripe Fees

Fees are the first thing to consider before you add any new software or service. 

The fees levied in the context of online payment transactions may include payment processing fees, transaction fees, international payment processing fees, and much more!

Thankfully, both stripe and PayPal have a free version under their basic plans for ordinary people. So there are no monthly or service fees, no interchange costs, etc.; only the base fee per transaction. 

You simply sign up -> enter your account details -> and get started!

However, as you start collecting payments, you’ll have to pay some bucks for the services. 

For business accounts, both these payment modes have different plans. Apart from paying the same base fee per transaction for both PayPal and stripe, you’ll also need to pay intention transaction fees, etc. 

PayPal, to mention, further breaks down the fees incurred on factors such as:

  • US or international payments
  • Micro or Macro payments
  • Online, Mobile or In-Store
  • Profit or Non-Profit
  • Virtual Terminal to collect payments by phone
  • Hosted, Embedded, or Customized Checkout

Apart from this, PaPal also imposes fees for:

  • Recurring Billing
  • Currency Conversion
  • Chargebacks ($20 fee compared to Stripes $15)
  • REfunds
  • American Express Payments
  • Mobile Card Reader Transactions

Compared to PayPal, Stripe has a more simplified fee structure.

Besides the standard fee charged per transaction, Stripe levies charges for processing international credit card payments as well as disputes, conversion of currencies, and billing services. Also, Stripe has refunds that cost you the original fee assessed.

Although both PayPal and Stripe have extremely transparent, flat-rate pricing at their basic level, both offer expansile services that influence the functionality and, thus, the pricing. 

If you don’t want the complication of fees tracking, Stripe will be a better option for you as it is more straightforward and manageable. 

So, Stripe is the winner here!

PayPal vs stripe
PayPal and stripe

Stripe is an Irish-American financial service and software as a service (SaaS) company dual-headquartered in San Francisco, United States, and Dublin, Ireland. Brothers John and Patrick Collison founded Stripe in Palo Alto, CA, in 2009, and became part of the Ycombinator program. In 2011, the company received an investment of $2 million including from PayPal co-founders Elon Musk and Peter Thiel, Irish entrepreneur Liam Casey, and venture capital firms Sequoia Capital, Andreessen Horowitz, and SV Angel.

Accepted Payment Types

This is one factor that you’ll need to pay more attention to if you have a business account. 

Why? Let’s find out!

Comparing PayPal vs stripe, PayPal accepts payments through:

  • PayPal Cash and PayPal Cash Plus
  • PayPal Credit
  • Debit Cards
  • Credit Cards
  • Pay by Phone

Here, a few payment options are only available on particular plans, so read all of them carefully as to what they offer before signing up. 

If these restrictions in payment types bother you, you may prefer hopping into Stripe. 

Stripe accepts payments from a wide range of methods like:

  • Debit Cards
  • Credit Cards
  • International Cards 
  • AmEx Checkout
  • Masterpass by MasterCard
  • Visa Checkout
  • WeChat Pay
  • AliPay
  • Apple Pay
  • Google Pa
  • ACH credit and debit
  • SEPA direct debit and more

While PayPal customers would love to see the PayPal logo on your site, demonstrating to your customers that you accept payments from a whole host of recognizable and trusted financial institutions evens the play. 

In my opinion, Stripe has the most appealing list of accepted payment options, especially for businesses that have customers spread across the globe.

So, Stripe is the clear winner here!

Stripe, the global digital payments firm, has opened a new office in Dubai.
PayPal vs stripe
PayPal and stripe
Stripe Dubai Office

Countries and Currencies

This is where it all gets interesting!

Here, we are going to look at how far and wide PayPal and stripe lets you conduct your business and accept and make payments. 

PayPal allows users to accept and make payments across 200 countries, whereas Stripe only has its services limited to 42 countries. 

However, PayPal can only process 25 currency types, whereas Stripe can process over 135 currency types. 

Being a normal user, you’ll need to check if the payment mode you’re choosing processes your currency and works in your country or not. 

And for business users, you’ll need to find where your customers come from—you’ll need to review your company’s data to choose the payment mode. 

So, I guess it’s a tie here! However, both the payment options have few drawbacks, making them both EQUAL. 

Advanced Billing Options

Beyond helping businesses accept one-time payments online, PayPal and Stripe both offer a handful of advanced billing options to its customers, a few of which have noteworthy differences. 

Depending on the type of business you have, it’s necessary to consider the advanced billing options offered by PayPal vs stripe.

Both the payment gateways offer subscriptions so that you can easily generate recurring and automated payments. Stripe subscription, to mention about, include a few additional features in them. 

PayPal and Stripe both offer to invoice. 

PayPal has a wide variety of multichannel options so that you can make or accept payments easily. But as far as Stripe is concerned, it’s more inclined towards the e-commerce space, so you won’t find many options here. 

However, you can purchase card readers for both payment platforms.

The final comparison in paypal vs stripe that we’re going to see is their market compatibility. 

In the case of PayPal, it has a solution designed for websites that involve multiple parties in the transaction process named PayPal for Marketplaces.

And Stripes marketplace solution, known as Stripe Connect, gives users a choice of configuration depending on how they need their transactions to take place, e.g., one-to-one, one-to-many, or many-to-many. 

What’s more is that Stripe also helps its customers with more complicated matters like international fees, transmission licenses, taxes, etc. 

Your selection of online payment platform with regard to Advanced Billing Options will totally depend on your minted on selling services or products.

If you’re looking for the ability to seamlessly sell in-person and online, PayPal is made for you. But if you’re looking to sell your products and services online and depend on deeper customization capabilities, then opt for Stripe. 

All in all, comparing paypal vs stripe, the crown for this point goes to Stripe!

Security and PCI Compliance

Wanna get rid of the responsibility to securely handle that data? That’s why you’re trusting these third parties for payment processing, right?

Payments require a whole new level of e-commerce security that one might not be prepared for, even if their site is already well-secured. 

While this being the case, it’s good to know that PayPal and Stripe both have you covered in the way of PCI (Payment Card Industry) Compliance. 

So, whatever payment method you’re using, you and your customers are safe from frauds!

PayPal also offers a few tools that might prove helpful, such as annual self-assessments, transparent redirects, quarterly scans, etc.

Stripe likewise ensures compliance with international standards. In addition, it will handle all your PCI compliant issues for you without charging any extra fees or work on your part.

We wouldn’t be talking about these payment processors; they weren’t fully PCI compliant in the first place. So therefore, security shouldn’t be a concern for you if you’re choosing one of these options.

And as both the payment platforms take full care of your and your customers’ security, there’s no one winner here. Instead, it’s a TIE between PayPal and Stripe.

Payouts and Transfers

We have been talking about the various types of payments one can collect and how you can do the same on your website, but now we will discuss how one can get paid with PayPal and Stripe.

And you would be pleased to know that neither of the platforms requires its customers to own a merchant account. Instead, all you need to have is an active bank account that you can connect to any one of the platforms. 

To tell you about, PayPal will deposit payments directly into debit cards, but you’ll have to pay a fee for these transfers.

If you own the Paypal business debit card, then you can shop as long as you want with your PayPal balance in any stores that accept MasterCard. 

PayPal transfers your payments to you within one business day (typically), so there is not much of a waiting time involved here.

Comparatively, Stripe payouts require about two days to transfer your payments. You can also automate the process and have Stripe deposit all funds in your account weekly or monthly. 

Both these payment processors offer their users with a relatively quick payout and have flexible transfer options.

However, PayPal wins this one by a day.

So who’s the final winner here?


Stripe wins this by 5-3!

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PayPal vs Stripe: The Comparison Table

Let us have a look at a companion table comparing all the major features of PayPal and stripe thus helping us decide which is better PayPal or stripe.

Service PayPal Stripe
Fee incurred Per Transaction 2.9% + 30¢ 2.9% + 30¢
Non-Profit Discount Offered 2.2% + 30¢ 2.2% + 35¢
Setup Costs or Monthly Fees N/A N/A
Contract Required N/A N/A
Micropayments (<$10) 5% + .05¢ 5% + 10¢
Recurring Billing N/A 0.5%+
Chargeback Fees $20 $15
Refunds No Fees Returned No Fees Returned
Consumer Support Help Center, Email, Phone & Chat Help Center, Email, 24*7 Phone & Chat
Ease of Use Easy  Easy
Ease of Setup Easy Moderate
PCI Compliance Yes Yes
Countries Available In 200+ 42+
Access to Funds Times Immediate 2 Days (Average)
Data Portability N/A Yes
Online Invoicing Free Free for First $1M in Sales 
In-Person Card Readers Free & Paid Paid
Payments Handled 100% on Your Site No Yes

PayPal vs Stripe vs Square Payments: The Best One for your Business

PayPal vs stripe
PayPal and stripe

Researching about and comparing PayPal vs stripe vs square was actually a fun job. These top three payment gateways are no doubt the best ones amongst all, and that’s why here on the list of the best payment gateways!

Looking at these payment gateways from the business perspective, they provide countless features for business accounts. 

PayPal vs stripe
PayPal and stripe

Square, is an American financial services and digital payments company based in San Francisco, California. The company was founded in 2009 by Jack Dorsey and Jim McKelvey and launched its first platform in 2010. It has been traded as a public company on the New York Stock Exchange since November 2015 with the ticker symbol SQ.

Let us compare all of their features to find out which ones are the BEST among them!

Feature Comparison paypal vs stripe vs square


A payment gateway offering excellent security tools for your business and for your customers is all a Business needs. And the good news is that PayPal, Stripe, and Square are robust, stable, and secure payment platforms. 

The BIG THREE not only use end-to-end encryption to store data securely but are also PCI Compliant.

Besides paypal vs stripe vs square, all three companies recruit other internal security, privacy, and fraud protection practices to ensure that all of its sensitive data is protected from unauthorized access. 

Having all of these points in mind, one can be confident that their data is being handled securely.

Chargebacks and Refunds

Chargebacks can be upsetting for businesses, so having a clear perspective of how they’re handled by such companies comes in necessary. 

We all know that the transaction fee we pay remains with the companies, so except for that, what do we get back?

Let’s have a look at how much of your money you can get back.

PayPal charges a $20.00 fee. This amount is refundable if a case is ruled in your favor. Stripe issues a refundable $15.00 fee for such instances.

 And Stripe, remarkably, provides credit card fraud protection in its Stripe Radar feature package. 

Square, on the other hand, does not charge any additional fees for chargebacks.

Methods and Availability

PayPal has its branches spread over 200 countries and supports 25 currencies in all, giving businesses the potential to reach more customers across the globe. 

Payments on paypal can be made using various methods, including PayPal Cash, PayPal Cash Plus, Bank accounts, Rewards Balance, etc. 

Stripe is accessible in 42 countries but supports over 135 different currencies. Stripe also accepts more and more major cards, including Visa, Mastercard, American Express, JCB, and others.

Square has its services limited only to the USA, UK, Japan, and Australia. Unfortunately, Square also does not offer any different currencies. 

It accepts payments with any US-issued and most internationally-issued chip or magstripe cards bearing MasterCard, Discover, Visa, American Express, etc.

Customer Support

Pitifully, none of these payment gateways are known for having excellent customer support.

However, these companies offer different customer service and support options like Live Chat Support, Phone and Email Support, Developer Support, Community Forums, and Social Media.

User Friendliness

PayPal has an incredibly simple interface that is easy to set up, integrate and start taking and making payments, even for people having less or no developer skills. 

If you can read HTML while copying and pasting developer tools, setting up PayPal will be straightforward for you. 

As long as Stripe is concerned, its developer-friendly API is its USP (unique selling point). However, this feature often appeals coming from a developer viewpoint only. Even with the compendious developer tools and libraries that Stripe has, people lacking developer skills will find it challenging to set up and integrate it.

With the help of its API, Square makes it simple for almost anyone to integrate its payment processing into your business software. In addition, this addition, this payment gateway also contains resources that will guide you through the whole process.

Stripe vs PayPal: The Cheaper One?

Do you know why PayPal and Stripe are the leaders of the online payment industry?

Because of their transparency in fees, amongst others. 

Both these payment gateways charge 2.9% + 30¢ US transaction fees and don’t incur any setup costs, basic monthly fees, or contracts. 

Both these companies also offer nonprofit discounts at 2.2% + 30¢ for US fees. 

In spite of these discounts, Stripe would be a better choice for your business. 

Why so?

Though PayPal does not charge monthly fees, its rates are much higher compared to most other traditional merchant accounts. 

And what’s worse than spending too much money in a business?

PayPal also has plenty of risks involved in it. 


PayPal has an inherently different business model than other traditional merchant account providers. Failing to understand this major difference may cause you to lose your business.  

This is what makes Stripe more worthy of use for your business as compared to PayPal. 

Which One is the Cheapest Payment Gateway?

Amazon Pay is considered the cheapest payment gateway globally for accepting payments. And if you wanna have the best and cheapest one for making payments, then you may choose Square. And the third option you may want to choose if Square is not available in your country will be Stripe.

Can I Pay with PayPal on Stripe?

Stripe DOES NOT integrate with PayPal, so the answer here is NO.

Stripe vs PayPal: The Better and The Right Choice For Your Business

We’re looking at the two largest online payment service providers in the market, and we know both can provide your business with quality service, all transparent, easy and fast! 

Both of them will provide your business with a wider reach across the globe, given to the multiple languages, currencies, and countries they are available in.

However, when comparing the two with your type of business, small business or large business, you are going to get different answers. 

If you have a small business, PayPal would be the best choice for you as it has a simple setup and is easy to use. In short, it’s non-confusing, and you can easily find your way out of everything on its interface by yourself.

But one thing you’ll need to look after is its rates. PayPal has much higher rates than any other traditional payment gateway. But, leaving that, there’s nothing that PayPal can’t offer to your small business. 

Speaking about Stripe, it would be a much better choice for large businesses as it offers additional features with more customizations related to payment modes, etc. 

Stripe is also one of the most trusted and experienced online payment service providers, so you won’t have to worry about those large amounts being transferred anymore. 

In the end, you know what your business needs the most, so choose the one that you think might best suit your and your business needs.

Stripe vs PayPal: Integrations

Stripe and PayPal have numerous integrations in the bag for those who wish to expand their functionality, ranging from shopping carts to accounting software to email marketing services and much much more!

You shouldn’t have much trouble finding a tool that helps you with the task you wanna perform or to make an API call that’ll pull out the information you need into a program of your choice. And this is unless you want specific brands that are only supported by one of these services. 

However, I would like to bring one point to your attention here that Stripe also presents its users with options for programs that integrate Stripe. These programs are mainly aimed at people wishing to use Stripe through getting that computer science degree to implement it. 

PayPal vs Stripe: The Final Verdict

After looking at the top payment processors’ top features, I’m literally in love with both of them. 

Both of them are good at some points while lacking in some. Thus, making the scale equally balanced. 

A lot of people choose their payment service providers just by their names and don’t actually look into all the jargon of it, the features it provides, where it lacks, etc. But very noble of you that you’ve come so far to get your which is better paypal or stripe question answered. 

Looking at the whole paypal vs stripe comparison above, I think Stripe will be a better option regardless of what kind of business you have, small or large, new or old. 


Stripe provides its users with advanced tools for their business. Yes, they might be difficult to understand at first, but we can’t unsee the benefits they’ll give to a business. 

And, in the overall comparison of paypal vs stripe, we’ve seen Stripe triumph over PayPal, so Stripe it is!

But, in the end, I would recommend you to choose the one that you think best fits your business type and the one which you find more trustworthy and efficient.  


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