PayPal vs Stripe for business in Australia. Which is for you?

Running and managing an online business can be made easier these days through a range of new online payments platforms to facilitate and accept payments. Choosing which one is best for your business requires research and what needs your business requires to be met.

We’ll take you through two options - PayPal and Stripe - that are available to the Australian market and cover their business services, fees and how they safeguard your money.

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Who is PayPal?

PayPal is a large multinational online payments company that is operating in over 200 markets around the world. Paypal has been operating in Australia since 2005 and currently has over 7 million active accounts.¹

PayPal allows personal and business customers to send and receive money between PayPal accounts from around the world. PayPal allows personal customers to:

• Shop and checkout at thousands of online stores
• Pay with linked cards or a bank account
• Send money securely
• Track all your purchases history

PayPal also has a business commerce platform that allows businesses of all sizes utilise PayPals services to sell their products online and accept payments from customers.² We’ll be focusing on this leg of the Paypal Australia services in this article.

PayPal for business in Australia — Main product offerings

PayPal offers businesses a solution to accept payments online, physically in store or on many of the online marketplaces. Businesses can offer their customers to pay through:

• Online checkout
• QR codes
• Email payments
• Smartphone payments
• Social media payments

Once a business has access to their own PayPal commerce platform, they will take advantage of several tools to make managing their payment easier. These include:

• Resolve and respond to customer queries
• Check the status of all payments
• Access business insight information
• Withdraw your money to your bank account

Once you have been established with your PayPal business account for a while, you may be able to access a PayPal Working Capital business loan that has no impact on your credit score.³

Who is Stripe?

Stripe is an integrated suite of payment solutions founded in 2011 and has since grown to offer its products globally. In Australia, stripe has been in operation since 2014. Unlike PayPal, Stripe offers their payment products to businesses, enterprises and developers.⁴

Stripe for business in Australia — Main product offerings

As Stripe only works with businesses, all their main product offerings are designed and catered to this clientele. Businesses are able to:

• Accept payments in online or in person
• Send money globally
• Grow their business revenue with automated solutions
• Access Banking-As-A-Service

Once a Stripe account has been activated, businesses will be able to:

• Send invoices
• Create and issue virtual cards
• Manage your business spending
• Fraud detection and protection options

Stripe also accepts payments in over 135 currencies and allows businesses to develop their own Automated Programming Interfaces (API) into their stores.⁵

PayPal vs Stripe — Business Fees

Main fees charged by both companies for their respective main business product, like accepting money/payments, withdrawals etc.

Service	PayPal⁶	Stripe⁷
Accepting domestic commercial transactions	2.60% + $0.30	1.75% + $0.30 AUD
Accepting international commercial transactions	3.60% + fixed fee based on currency	3.5% + $0.30 AUD
Chargeback fees	Fee charged if not eligible for PayPal Seller Protection - varies per currency AUD - $15.00	$25.00 per lost dispute
Foreign Exchange Conversion fee	Fee for receiving in another currency = 4% Fee for sending payments = 3%	International receiving fee + 2% conversion fee
Withdrawing funds	Minimum fee: $0.25 AUD Maximum fee: $10.00 AUD	Free in AUD to AUD bank accounts

As seen on 7 October 2023

PayPal vs Stripe — Exchange rates used

When it comes to sending or receiving money in foreign currencies, different conversion rates can apply. Companies choose how to apply conversions either by including a fee, known as a margin on top of the wholesale or mid-market rate. Here is how conversions are applied with PayPal and Stripe.

PayPal⁸	Stripe⁹
Wholesale rate from NAB + PayPal fees	Mid-market rate + Stripe allocated fees

As seen on 7 October 2023

In 2021, PayPal and National Australia bank signed a partnership to facilitate local business transactions.¹⁰

PayPal vs Stripe — Supported currencies

Both PayPal and Stripe can facilitate foreign currency business transactions. Here are the currencies and regions supported.

Service	PayPal¹¹	Stripe⁵
Currencies supported	25	135+
Countries/Regions available	200	46

As seen on 7 October 2023

Pay in and pay out (withdrawal) payment methods

How you can receive your business payments and then where you can withdraw the funds can help make your choice easier.

	PayPal	Stripe⁷
Pay in options	Credit or Debit Cards Echeques Instant bank Account QR codes³	Debit or Credit card Bank account Payment links
Pay out or withdrawal options	Bank account⁶	Bank account⁷

As seen on 7 October 2023

PayPal vs Stripe — Pros and cons

Here is a quick breakdown of the pros and cons of each company.

	PayPal	Stripe
Pros	Global reach Easy to use Available to personal customers	Integrated platform with API’s Fixed fees Many currencies supported Free withdrawals
Cons	High fees on transactions Conversion fees Limited payment protection Withdrawal fees	High dispute fee Conversion fees Business customers only

What about safety?

Knowing how your money is protected online can make a huge difference when choosing your provider. We’ll compare the safety features of both companies and how they are regulated in Australia.

PayPal

Paypal in Australia is provided by PayPal Australia Pty Ltd under the Australian Financial Services Licence (AFSL) 304962.²

PayPal is Payment Card Industry Data Security Standards (PCI DSS) certification which is required as a payment provider.¹² PayPal also provides businesses using their services:

• 24/7 transaction monitoring
• Transaction dispute centre
• Encryption technology
• PayPal seller protection options

PayPal has also been a reputable international brand since its inception in 2005.¹³

Stripe

When you make an account with Stripe, you are going into an agreement with Stripe Payments Australia Pty Ltd under the AFSL number 500105.¹⁴

As a payments provider, Stripe must meet certain standards to operate to help keep your money and data safe. Stripe is PCI Service Provider 1 certified which is the means they meet the highest standards for security as a payment provider. Stripe also:

• Frequently conducts System and Organisation Control (SOC) audits
• Has security policies based on the NIST CyberSecurity Framework
• Continually updates Privacy and Data controls
• Offers account access security features include multi-factor authentication (MFA)
• Has mandated HTTPS connections and encryption on all services
• Third party system monitoring for system issues
• Employee access management controls
• Dedicated security teams on call

Stripe also guides account users on how best to keep their own accounts secure and has reporting suites for suspicious transactions.¹⁵

Online reviews for PayPal and Stripe in Australia

To see how PayPal and Stripe compare in the Australian market, here are how they have been reviewed by Australian consumers.

PayPal reviews	Stripe reviews
PayPal Australia has been rated 1.4 stars out of 5 on Trustpilot from 87 reviews.¹⁶	Stripe has a rating of 3 stars out of 5 stars from 12, 441 reviews on Trustpilot.¹⁷
On Capterra Australia, PayPal has been rated 4.7/5 stars from 24,900 reviews.¹⁸	On Capterra Australia, Stripe is rated 4.7/5 stars from 2,951 reviews.¹⁹

As seen on 7 October 2023

Customer support and contacts

Here are the customer support options for each company.

PayPal	Stripe
PayPal online resolution centre	Stripe Support online centre
Online community support	Online chat support
	Email support
	Phone call request

In conclusion

Only you can make the decision on which provider best suits your business needs when it comes to accepting and making business payments. As you can see from above, PayPal and Stripe are comparable but have very different service offerings overall.

As Stripe has predominantly been built to cater to businesses, this makes it a good option for merchants looking for an integrated suite of online business management services. PayPal, as a well-known and longstanding company, is also a good option for receiving payments from all over the world. However, PayPal does come with a variety of higher fees on many of their transactions, especially conversions.

The Wise Business Account

The Wise Business Account is a good alternative for local and international finance. It can also connect to your Stripe account for receiving payments.

With this Business account, you can make international payments to 160+ countries in over 40 currencies using the transparent mid-market rate plus a small transaction fee.

You’ll also get access to local Australian AUD account details, and account details for over 9 other major currencies.

The Wise business debit card can be used at ATMs, in-store, or online shopping via the Mastercard network. Additional cards can be made available for other team members as you choose, with one fixed card-creation fee per card and no monthly fees.

Find out how the Wise business account can save you money.

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Please see Terms of Use for your region or visit Wise Fees & Pricing for the most up-to-date pricing and fee information.

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Sources:

1. PayPal Australia
2. PayPal How it works
3. PayPal business Australia
4. AFR Stripe Australia launch
5. PayPal merchant fees
6. Stripe pricing
7. PayPal Exchange rate
8. Stripe conversion rate
9. NAB PayPal collaborators
10. PayPal currency
11. Stripe currencies
12. PayPal compliance
13. PayPal safety
14. Stripe licence
15. Stripe security
16. Trustpilot PayPal reviews
17. Capterra reviews
18. Trustpilot Stripe reviews
19. Capterra Stripe reviews
20. PayPal contact methods
21. Stripe contact options

Sources checked on: 07 October 2023