TL;DR
Stripe is the default for online businesses and SaaS. PayPal has the widest consumer trust. Square wins for in-person + online retail. Paddle handles SaaS taxes globally. Lemon Squeezy is Stripe for indie hackers.
Quick Comparison
| Processor | Fees | Best For | Setup |
|---|---|---|---|
| Stripe | 2.9% + $0.30 | SaaS, online | Minutes |
| PayPal | 2.9% + $0.30 | Consumer trust | Minutes |
| Square | 2.6% + $0.10 | Retail + online | Same day |
| Paddle | 5% + $0.50 | SaaS tax handling | Days |
| Lemon Squeezy | 5% + $0.50 | Indie SaaS | Minutes |
1. Stripe
Developer-friendly, supports subscriptions, invoicing, and 135+ currencies. Stripe Atlas for company formation. The standard choice for tech startups. Excellent documentation and APIs.
2. PayPal
Consumers trust PayPal checkout. Higher dispute rates but broader reach internationally. Good as a secondary payment option alongside Stripe.
3. Square
Best for businesses with physical and online presence. Free POS hardware, integrated inventory, and online store. Lower card-present rates.
4. Paddle
Merchant of record — handles global sales tax and VAT compliance for SaaS. You set prices, Paddle handles tax headaches. Worth the premium for international SaaS.
5. Lemon Squeezy
Merchant of record built for indie hackers. Handles tax compliance, license keys, and affiliate programs. Simpler than Paddle, designed for solo founders.
How We Chose These Tools
We compared fees, setup time, subscription support, international capabilities, and tax compliance features. Developer experience and documentation quality mattered for tech founders.
Key Takeaways
- Start with Stripe unless you have a specific reason not to.
- Add PayPal as a secondary option to reduce checkout abandonment.
- Use a merchant of record (Paddle, Lemon Squeezy) if global tax compliance scares you.