PayPal vs Stripe Fees:
Which Costs You Less?

If you accept payments online, you're paying fees to somebody. PayPal and Stripe are the two most popular payment processors for freelancers and small businesses — and understanding their fee structures can save you hundreds of dollars per year.

The Standard Fee Structure

For a standard online card payment from a customer in the United States, the two platforms no longer charge the same rate:

• Stripe: 2.9% + $0.30 per successful card charge
• PayPal Checkout and PayPal invoices: 3.49% + $0.49 per transaction

The gap looks small in percentage terms, but because both the percentage and the fixed fee are higher at PayPal, it shows up on every single payment. The conditions for international payments and currency conversion widen it further.

PayPal Fees Explained

PayPal's fee structure has several layers depending on how you receive payments:

• PayPal Checkout (3.49% + $0.49): Applied when buyers pay through the PayPal button on your website.
• Friends & Family transfers: No fee for the sender if funded by bank/balance, but these cannot be used for commercial transactions.
• International transactions: Additional fee of 1.5%–2% on top of the standard rate.
• Currency conversion: 3–4% spread applied when currency conversion is involved.
• PayPal Invoicing: 3.49% + $0.49, the same as Checkout.

One important caveat: PayPal recently updated their fee schedule to include a fixed fee that varies by currency. The $0.49 applies to USD transactions. For other currencies, the fixed portion changes.

Stripe Fees Explained

Stripe's pricing is known for its transparency and simplicity:

• Card processing (2.9% + $0.30): All major card brands, same rate.
• ACH Direct Debit: 0.8%, capped at $5.00 — great for large transactions.
• International cards: +1.5% added to the base rate.
• Currency conversion: 1% on top of the base when conversion is needed.
• Stripe Radar (fraud protection): Included free, or $0.02/transaction for advanced rules.

Stripe also offers volume discounts and custom pricing for businesses processing over $80,000/month — something PayPal does not advertise as transparently.

Side-by-Side Comparison

Here is the real cost of a domestic US payment on each platform:

For domestic card payments Stripe is cheaper at every amount. A freelancer invoicing $5,000 a month in $1,000 payments would pay about $30 more per month – roughly $365 a year – by collecting through PayPal instead. The gap grows with international payments and currency conversion, where PayPal's surcharges are higher.

When to Choose PayPal

• Your customers already have PayPal accounts and prefer it
• You need a quick, low-setup payment link or invoice tool
• You're accepting payments in a B2C marketplace context
• You need to pay contractors globally via PayPal Mass Pay

When to Choose Stripe

• You're building a product with a custom checkout flow
• You need robust developer APIs and webhooks
• You process a high volume of large transactions (ACH saves significantly)
• You want the most transparent, documented pricing
• You need subscriptions, metered billing, or SaaS infrastructure

The Bottom Line

On fees alone, Stripe costs less for domestic card payments and considerably less for international ones and large ACH transfers. PayPal's advantage is not price but familiarity: some clients and buyers simply prefer to pay with their PayPal account, and that can be worth the extra cost if it closes the sale. Many freelancers offer both and let the client choose, building the higher PayPal fee into the price.

Want to run the numbers yourself? Use our free PayPal Fee Calculator and Stripe Fee Calculator to see exactly how much any transaction will cost you.