PayPal vs. Stripe: Choosing for Your Ecommerce Business

Author: Jack Martin

Stripe and PayPal are the most popular credit card processing companies for Ecommerce because they provide business owners an all in one package when it comes to processing credit card transactions. Back in the day, Ecommerce businesses would need multiple services to process a credit card transaction. Now Stripe and PayPal have solved that headache, but which method of payment is better?

Stripe

Stripe is the new kid on the block when it comes to credit card processing. Founded in 2011, the company has grown quickly to becomea force to be reckoned with. The company is gaining popularity among all businesses, but primarily in the Ecommerce industry. They offer customizable friendly cart options and a competitive fee structure.

PayPal

PayPal is the king of online transactions. PayPal became a popular name among Ecommerce companies, from their use on eBay. PayPal offers a wide variety of services for businesses in a tiered level format. While being one of the biggest of credit card processing companies, they still maintain competitive fee structures.

Fee Structure

Stripe

Charges:

2.9% + $0.30 per transaction with
Discounts starting at $80,000 a month in sales.

Pros:

No other fees are associated with the service, and there are no refund costs
There are no additional charges for international sales
Superiorcustomer service availability
Developer friendly carts with no additional charge
Credit card information is transferred directly to Stripe servers with no other points of contact

Cons:

Funds can take up to 48 hours to be deposited in the business bank account

PayPal

Charges:

US 2.9% + $0.30 per transaction
International 3.9% + per transaction fee based on location

Pros:

Funds from that day’s transactions are deposited into a company bank account within 24 hours
Proven company that has been around for over 10 years

Cons:

Additional $30/month charge to have check out cart on website
There are refund fees
Your secure information mustpass through both thatbusinesses servers andPayPal’s servers

What should you pick?

Stripe is the recommended service for an all in one credit card processing platform for Ecommerce businesses. The free customizable cart on the business website really sets Stripe apart from PayPal. The free option on PayPal is to leave the business website and finish the transaction on PayPal’s website. Ecommerce businesses are aware that the less work customers have to do, the odds are better that they will buy a product.

The developer friendly carts and more strict security are big reasons why an agency like ourselves would choose Stripe. PayPal is still a proven option, but right now Stripe is more innovative and caters to our needs while maintaining a competitive price point for their services.