Stripe Vs. PayPal – Which Is Better in Canada

Online money transfer has become much easier than ever before. With the emergence of platforms like Stripe and PayPal, you can now send money to your friends and loved ones, donate to charity, and even purchase goods and services online without leaving the comfort of your seat.

Most importantly, you can easily collect online payments through your business website without inconveniencing your clients.

Today, we compare two of the largest money transfer platforms on the web – Stripe and PayPal. We break down the pros and cons of each while highlighting the major differences between these online payment providers.

Strive Vs. PayPal Compared

Stripe is an online payment solution designed for internet businesses. The payment provider supports the convenient transfer of money from a client’s wallet into a merchant’s account as payment for goods and services. 

Launched in 2009, the Irish-American company essentially provides all types of startups, small businesses, and large companies running e-commerce websites with payment processing solutions.

PayPal is a leading online money transfer service that connects buyers and sellers. The service allows you to send and request money over a secure internet account. 

In addition to allowing customers to make secure online payments, PayPal allows web users to send monetary gifts and donations to family, friends, and non-profit organizations. The platform has over 200 million active individual accounts with over 21 million merchants subscribed to the service.

Both Stripe and PayPal are reliable online payment platforms that strive to remove the barriers of e-commerce. With your business now able to collect payments promptly, you can focus on other tasks that will take your enterprise to the next level. 

Stripe and PayPal help existing businesses to grow rapidly while increasing economic output over a secure internet connection.

If you are planning to use either for dropshipping, read Stripe Vs. PayPal for Dropshipping.

What is Stripe good for?

Stripe is the go-to option for businesses that choose to work exclusively over the internet. They offer companies free API programs so that they can build their own e-commerce infrastructure for quick and secure payments. 

The payment provider is a great credit card processor, and it supports the electronic transfer of cash from a customer’s bank directly to the merchant’s account within minutes.

Stripe is very fast and the platform is capable of handling large transactions without compromising financial data.

What is PayPal good for?

PayPal is a great choice for individual web users, small merchants, and large companies that need to transfer money online. In essence, you can use PayPal for both personal and business transactions. 

The platform allows you to monitor online orders for your business in a secure and transparent manner. The best part is that it is free to set up and it allows your clients or associates to transact with your business without having to convert currency.

Who Uses Stripe and PayPal?

If you have an online business, then you must ensure that your customers can pay for goods and services easily and securely. Stripe and PayPal are some of the leading online payment providers that you can rely on for secure money transfers. Other entities that depend on Stripe and PayPal include:

  • Online freelancers
  • E-commerce companies
  • Non-profit/charity organizations (collecting donations). Read Stripe vs. PayPal for Nonprofits
  • Online marketplaces
  • Entrepreneurs

So, between Stripe and PayPal, which one is better? 

Read on to find out more about these awesome online payment solutions and how they stack up against each other.

Ease of Use

Both Stripe and PayPal are very easy to use and set up. Signing up is 100% free and the registration process takes just a few minutes.

Moreover, both platforms come with pre-built templates that you can integrate onto your website to allow your customers to make easy payments.

However, you need some development knowledge to take advantage of the API programs provided by Stripe.

Verdict: PayPal wins in terms of ease of use since it does not require coding knowledge to customize and embed the provided API program on your website.

Security

Whether you are a merchant or a shopper, you need assurances that your financial data is safe and your online transactions are secure.

The good news is that both Stripe and PayPal are Payment Card Industry (PCI) compliant and they use the latest, highest grade security layers to protect your financial data.

Verdict: Both Stripe and PayPal tie as far as security is concerned.

Availability

If you run an online business, you must be sure that your customers can access their favorite payment processor from wherever they are.

Stripe is available in 44 countries only, while PayPal is available in more than 200 countries.

Verdict: PayPal is the clear winner in terms of availability. You and your customers can access PayPal from nearly any country in the world.

Transaction Fees

Stripe and PayPal are very transparent as far as transaction fees are concerned. They do not charge monthly fees or contracts like most financial institutions. 

Stripe charges 2.9% + C$0.30 for every successful credit card transaction and C$0.15 per Interac debit card transaction.

PayPal charges 2.9% and a fixed fee of C$0.30 for every commercial transaction. Personal payments to family and friends are free within Canada.

Verdict: The transaction fees are similar thus settling the contest between Stripe and PayPal

Online Invoicing

Online invoicing ensures less paperwork while allowing you to track your transactions more easily.

Both Stripe and PayPal support online invoicing and recurring billing for free with no monthly or cancellation fees. However, Stripe will charge you 0.5% once your recurring revenue reaches $1 million.

Verdict: PayPal carries the day since they do not charge anything for online invoicing even if your revenue exceeds $1 million.

Processing Times

Processing times for Stripe and PayPal vary greatly. Stripe transactions take 7 to 14 days for first-time payouts, but 2 days for subsequent payouts.

PayPal transactions are almost instant for PayPal to PayPal transfers, but it may take 2 to 4 days for PayPal to bank transfers.

Verdict: PayPal processing times are faster compared to Stripe’s. You can enjoy instant payouts for PayPal to PayPal transfers. 

Refunds and Chargebacks

A buyer may request a refund in case the items or services bought were not delivered or did not meet expectations. If this is the case, the credit card issuer will file a chargeback from PayPal or Stripe. 

The good news is that both Stripe and PayPal will first have to review the dispute before issuing a refund.

This may take anywhere from 60 to 180 days. Once resolved, the seller will pay a non-refundable chargeback fee.

PayPal charges a $20 chargeback fee while Stripe charges $15 as a chargeback fee.

Verdict: Stripe’s $15 chargeback fee is a little bit reasonable compared to PayPal’s $20 fee. For this reason, Stripe wins as far as refunds are concerned.

Customer Support

Stripe and PayPal have excellent customer support. You can contact support via multiple channels, including social media, email, phone, and live chat.

PayPal also has a community forum where you can get answers to common questions. However, Stripe seems to have an upper hand ever since they introduced 24/7 customer support.

In contrast, PayPal does not have round-the-clock support and they take time to respond to customer queries.

Verdict: Stripe wins hands down thanks to their 24/7 customer support

Does Stripe work in Canada?

Yes. Stripe is available in over 44 countries and regions, including Canada. The online payment provider made an entry into the Canadian market in September 2012 and it has been expanding its presence in the region rapidly.

With flat pricing and predictable rates, instant approvals, low chargeback fees, major credit card accepted and 24/7 support, it is just a matter of time before more businesses and customers embrace the use of Stripe in Canada.

How to decide which one to use in Canada?

When deciding what payment processor to use, you must compare various aspects such as availability, ease of use, processing time, security, transaction fee, chargeback fee, invoicing, and customer support. 

The ideal online payment solution must be available in your country of operation and where your core customers are.

Moreover, it should be secure to protect your customers’ credit card details and your financial data from unauthorized access.

If your business is well established and you transact a lot, then you should choose a processor that supports online invoicing and recurrent billing.

Both Stripe and PayPal support online invoicing, but Stripe charges a small fee on recurring revenues exceeding $1 million.

Most importantly, customer support should be accessible from anywhere and at any time to help clients resolve complex financial issues promptly.

What are other payment options in Canada?

Stripe and PayPal are not the only online payment options available in Canada. You can consider other reputable payment solutions such as:

  • Square
  • Skrill
  • Google Pay
  • WePay
  • Venmo
  • Zelle
  • Amazon Pay
  • 2Checkout
  • Payline
  • Shopify Payments

Final Verdict

Stripe and PayPal are both effective and flexible payment solutions for individuals and businesses alike. They offer great features that you can use to complete financial transactions quickly and securely over the internet.

For these reasons, choosing between Stripe and PayPal can pose to be a major challenge.

If you are looking for a more customizable payment solution, then you should consider a platform like Stripe. It provides users with various developer tools and API programs that you can customize for your website. However, this means you must have some coding knowledge to use these features.

PayPal is more straightforward and is comparatively very easy to use and set up. Besides, it is available in over 200 countries thus giving it an upper hand in terms of reach.

The only slight drawback is that it is not as customizable as Stripe. However, it remains the go-to option for fast and safe online payments thanks to its secure, user-friendly interface.