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Stripe VS PayPal: How to Choose The Right Payment Processor For Your Online Business

Both offer reasonably-priced payment processing, especially for eCommerce, but while PayPal wins in ease of use, Stripe potentially offers more bang for your buck.

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Chris Motola

Chris Motola

Expert Analyst & Reviewer: Payments & Finance at Merchant Maverick
An expert in personal and business loans and financial health, Chris Motola has been writing about small business finance and payments for over 5 years. He has been cited in various industry publications, including Forbes Advisor, GoBankingRates, and Medium. Chris is a graduate of the University of Central Florida.

We've done in-depth research on each and confidently recommend them.

We've done in-depth research on each and confidently recommend them.

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91 Comments

Responses are not provided or commissioned by the vendor or bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the vendor or bank advertiser. It is not the vendor or bank advertiser's responsibility to ensure all posts and/or questions are answered.

    Pascal Zoghbi

    Hi Chris,

    I want to know if I used Stripe for my e-commerce business, my prospective clients can pay with any credit card as well as apple pay and google pay. What about paying with a paypal account. Is this also an option with stripe? And if not, which other payment system platforms provide this? And what about Braintree? It allows credit cards and paypal together?

    Thanks

      This comment refers to an earlier version of this post and may be outdated.

      Jessica Dinsmore

      Hello Pascal,
      PayPal and Stripe are direct competitors, so you probably won’t be seeing PayPal transactions processed on Stripe’s infrastructure anytime soon. You can process Apple Pay and Google Pay transactions with it, however.

      If you want to accept PayPal, you can always use PayPal as a payment processor. It has similar rates to Stripe. Braintree is owned by PayPal and is compatible with it as you might expect. You can think of Braintree kind of like being PayPal’s advanced service—you can process ACH payments on it, which is something you can do on Stripe but PayPal’s branded service doesn’t support it.

        This comment refers to an earlier version of this post and may be outdated.

        Ian

        Hi, I am thinking of starting a drop shipping business that ship products from other countries such as China to the United States. I heard that PayPal hold on to the money paid by the customers to your PayPal account. Apparently, they only release the money to your account once the customer receive the product. May I know if Stripe operates the same way in which they only release your money once customer receive the product? Also, do Stripe allow you to use the money stored in your Stripe account to pay the suppliers/sellers? Can you actually design the Stripe payment system in such a manner?

          This comment refers to an earlier version of this post and may be outdated.

          Jessica Dinsmore

          Hi Ian,

          Stripe does have payouts through the Stripe Connect add-on, which you can fund from either your bank account or through payments you’ve received through Stripe. Beyond that, I’d suggest reaching out to Stripe for more specifics. Good luck!

            This comment refers to an earlier version of this post and may be outdated.

            Dennison Berwck

            A “tie” between PayPal and Stripe has not been my experience. PayPal for a merchant can be a nightmare, especially if you are a small merchant and happen to travel or be outside the US. (I know it’s amazing PayPal but before Covid people did travel all over the globe.)

            On one occasion, even though the operator agreed he had athenticated me and was sure I was the account holder, still his system would not give me access to my own merchant account – that after 2 HOURS of going around and around. So I could not check a customer payment and PayPal kept the money until I found a work around!

            Stripe, on the other hand, has been excellent. Easy to set up on my WordPress website, excellent support, excellent fraud prevention and DAILY payments to my bank account. (PayPal keeps the money until you log in and order a transfer!).

            In my experience, and talking with several other merchants around the world, PayPal lives on its brand recognition, not on the present day-to-day reality of its services. I try to direct all customers to use Stripe and only accept payments via PayPal reluctantly.

              This comment refers to an earlier version of this post and may be outdated.

              Carol

              Looking for an alternative to Stripe.

              As of April 1, 2020…if you refund a customer any amount…Stripe does NOT refund the fees it originally charged! How is that even legal?

                This comment refers to an earlier version of this post and may be outdated.

                Jessica Dinsmore

                Hi Carol,

                Surprisingly, it’s not illegal, and it’s actually included in their policies. We discuss Stripe’s questionable practice in our post on refund fees. We’ve also got some alternative recommendations in there too. Best of luck!

                  This comment refers to an earlier version of this post and may be outdated.

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