Stripe VS Paypal

Both Stripe and Paypal provide payment processing services to help you accept money through your website. But in my opinion, Stripe is easier to use and understand, simpler to setup, more flexible, and better value for about the same price as Paypal.

The goal of your payment processing system is to offer a convenient method for exchanging real money securely so your customers can trust buying products from you online. Both Paypal and Stripe fulfil this goal. That said, not every payment processing service is created equal and it is my opinion that Stripe provides a better overall value compared to Paypal. There will be initial effort needed to adjust to a new system (if you already have integration with an existing system, like Paypal, perhaps this is costly), but in the end I believe time and money will be saved by Stripe over Paypal and that the switch is worth the effort and expense.

Overview of Stripe's Benefits

• process payments directly on your site without the headache of complex payment gateways, merchant bank accounts, and PCI compliance
• secure interaction with Stripe servers keeps your customers' data safe
• seamless checkout experience within your own site means increased conversions and/or sales
• competitive pricing (in many cases cheaper)
• better analytics and reporting
• easier integration, setup, and maintenance
• great support for when you need help or something doesn't work
• backed by former Paypal founders Peter Thiel and Elon Musk
• don't get charged for refunds or disputes (see new pricing changes)

What other people are saying

"Call it a coincidence but since we switched to our new payments platform a month ago, sales have gone up."

— CenterNetworks

"'Using Stripe is almost as easy as embedding a YouTube video into a website,' says Mike Moritz, a venture capitalist with Sequoia Capital."

— Business Week

"Stripe has no setup fees, no monthly fees, no minimum charges, no validation fees, and no card storage fees. There’s also no charge for failed payments. You’ll never have to decipher a complex statement, because you know what you’re charged in advance."

— AppPulp

"[I] realized the biggest mistake I’ve made...to-date. What I found was that a number of customers filled in our order form, went off to Paypal or Google Checkout, but never completed the order...Call it a coincidence but since we switched to our new payments platform a month ago, sales have gone up."

— CenterNetworks

User Experience

Paypal

• re-direct users to PayPal's website, away from yours
• users enter credit card details or log into Paypal account
• user confirms they want to allow company to bill them
• user is redirected to company site
• user gets what they paid for

Stripe

• user enters credit card details or logs into company site
• user gets what they paid for

Setup

Paypal

Paypal's setup process is lengthy and confusing. I felt like I just got the manual for a fusion reactor. I didn't look forward to completing it...

Stripe

Email, password, password confirmation, done. How easy is that? It was so fast I still retained some of my initial excitement and wanted to push further with my app just to see what I could do with Stripe. With Paypal, I just wished that the process would end.

Cost

Each has similar costs, but Paypal has a lot of fine-print extras that Stripe doesn't have. Stripe is a simple transactional cost of 2.9% + 30 cents (only for successful transactions) and nothing more.

Support

Paypal

• makes backwards-incompatible changes that have left a lot of websites broken without adequately communicating the impact their change would make with their customers, losing them money
• calling in can be a laborious, time-consuming process, which may not actually get your problem solved
• documentation on Paypal's site is extremely confusing, often times out of date, and developer details (what's needed to actually make things happen) are usually buried under heaps of marketing material
• email can take days to get a solution to a problem
• some customers have had their accounts frozen for silly reasons

"All three of PayPal, Google, and Amazon suck, but I will honestly say that PayPal is probably the worst developer experience I've had in that same time period. And this was for a very simple implementation of a single product one-time purchase.

1. It took hours to figure out what product I wanted. PayPal's product assortment is a trainwreck. What the hell is the difference between Web Payments and Web Payments Pro and Adaptive Payments and about a dozen other things with idiotic names that all sound the same. The chart that tries to help you pick a product is useless.
2. The layout of paypal's website is labyrinthine. Even after I figured out what product I needed, assembling all the relevant documentation was hard.
3. The documentation is flat-out wrong in several (rather important) places. For example, the IPN guide (naturally, a PDF) on page 9 clearly states that you must explicitly post back messages to paypal to get them to stop sending (which is [stupid] and screws up transactions), but HN says that this is not the case. You can see my venting about this almost a year ago here.
4. Posting a technical question to PayPal's forum gave me an unhelpful response from a clearly first-level "read the flowchart" technical support rep. Pointless exercise.
5. PayPal's APIs all feel like they were designed in the 1990s. Seriously, I would be horribly embarrassed to publish an API like that. I put more thought into (and produce better documentation for) my opensource projects. Useless crap websites like Foursquare can come up with solid APIs, there's no excuse for a company that handles actual money to be this janky."

— stickfigure

Stripe

• interact through twitter, email, chat, or phone
• chatroom with real developers and business staff you can talk to directly
• they talk with you until your problem is solved and your technology is working

"When a customer of ours had an issue placing his order, I wrote Stripe to see if they could offer any insight as to what errors they might be seeing on their end. While the error was unrelated to Stripe itself, they were so awesome that they actually took the initiative to browse through our checkout page and point out the spot that they thought to be the issue. A company that stands beside you when debugging your checkout page, maintaining swift response times on an issue that isn't even theirs? That's customer support."

— michaelschade

API

Paypal

• cryptic
• badly documented
• non-standard interface

Stripe

• library integration with every major web programming language (curl, ruby, python, php, java, C#, and more)
• javascript makes embedding functionality directly into your website as easy as copy and paste
• rich fully documented reference online

Interface and Analytics

I'd hardly even call what Paypal has an interface. It's just a bunch of tables of text that don't make a lot of sense. Stripe, on the other hand, shows beautiful graphs and charts and makes the data comprehensible and clear.

Use Stripe next time you need online payments

Stripe is hands-down the way to go for payment processing online, in my humble opinion. When I tweeted that they launched in Canada they even sent me a free t-shirt! Do you think Paypal even cares that you exist? But the bottom line is that Stripe will save you money, give you less hassle (even make you feel good inside), and show you a clear picture of your bottom line.

NOTE: I'm not affiliated with Stripe nor am I benefiting from recommending them in any way. I just think they're what I've been waiting for for years and maybe they're what you've been looking for too.