Introduction
Dealing with international payments should mostly be predictable and stress-free. That’s because getting paid can be as important as delivering your goods or services. Which means that the platform you choose to handle those payments can make all the difference.
If you are stuck between Stripe vs PayPal, you’re not alone. Both are regarded quite well when it comes to cross-border payments, but they are pretty different in terms of their features and fee structure. Let’s find out how!
What are Stripe, PayPal, and Xflow?
Stripe is a financial platform that provides various payment and financial solutions to its users. With Stripe, you can transact in more than 135 currencies and send or receive money from over 47 countries. What Stripe is most widely known for is its custom-designed and developer-friendly features, through which it helps customers with their billing, invoicing, tax filing, and instant checkouts.
PayPal is a payment platform that helps individuals and businesses send and receive funds for cross-border payments online. It can operate in over 200 countries and offers multi-currency accounts in almost 25 currencies. With PayPal, you just need to connect your PayPal account with a checking account or credit card and start making transactions.
Just like Stripe and PayPal, Xflow is also a fintech company that provides payment infrastructure to businesses of all sizes – from SaaS providers to exporters. It also comes with a wide global reach, allowing you to scale easily, and being focused on Indian businesses, it also offers many solutions to help you comply with RBI regulations and FEMA guidelines.
Stripe vs PayPal: Core services compared
Here’s how Stripe and PayPal weigh against each other when it comes to their core features:
Stripe
- Business tools like billing, invoicing, payment links, and embedded checkouts.
- Developer-friendly APIs and SDKs for customized workflows.
- Support for card payments for receiving international funds in India.
- AI-powered fraud detection through Stripe Radar.
- Automatic invoicing of recurring payments.
- Reporting and analytics tools to track payments, fees, and payouts.
An important thing to note about Stripe is that, in India, it is only available on an invite-only basis. Which means you’ll have to request for an invite to the sales team and can’t sign up directly. You can use it only when you’re approved.
PayPal
- Multi-currency transactions with automatic withdrawal in INR.
- Tools for online invoicing, payment links, and integration with ecommerce sites.
- Online and in-person payments.
- Monthly digital FIRA of all foreign inward transactions.
- Support for local payment methods by clients, including bank transfer, card, Apple Pay or PayPal, without the need for a PayPal account.
- Buyer and seller protection for eligible and authorized transactions.
Fees and exchange rates: What you must know
When you receive international funds through Stripe, you’ll be charged in the following way:
1. A transaction processing fee of 4.3%.
2. Currency conversion fee of 2%.
Also note that Stripe doesn’t offer eFIRA. You’ll only get a Payment Advice that you can use in banks to receive FIRA from them.
Now, when it comes to PayPal, the fee structure works like this:
1. A 4.4% transaction fee.
2. Fixed fee that varies depending on the currency of the transaction.
3. A 4% markup over the mid-market exchange rate.
Cost-effectiveness for Indian users: Which platform typically wins?
Now that you know what you’ll be charged, let’s have a look at how exactly this works out in real-world transactions. Let’s say you received $5000 from your client in the USA, and the current exchange rate is $1 = ₹88.7433, here’s how much you’ll actually receive.
| Fee category | Stripe | PayPal |
|---|---|---|
| Transaction amount | $5k | $5k |
| Transaction fee | 4.3% of $5k = $215 | 4.4% of $5k = $220 Fixed fee: $0.30 |
| Currency conversion fee | $96.70(2%) | $191.61(4%) |
| Total fee | $311.70 | $411.91 |
| Amount you receive | ₹416,117.334 | ₹407,162.247 |
Now, if you use Xflow to receive that $5000 from your client, it will only charge you a $20 fee with no markup at all. This means the actual amount you’ll receive will be ₹441,697.96, making it clear as day which platform proves to be the most cost-effective.
Stripe vs PayPal: Speed, user experience, and platform access
Aside from the fees, another important factor worth considering when comparing Stripe vs PayPal for freelancers or other businesses is the speed of the platform. The speed of transactions generally depends on your region, the bank's network, and the number of compliance processes required.
Stripe transfers usually take 7 - 10 business days to get settled in your Indian bank accounts initially. After that, it can take anywhere between 2 and 5 days. PayPal, on the other hand, will settle your payouts in your bank account within 1 - 3 business days.
As far as the user experience is concerned, Stripe is more developer-friendly, offering a high level of customization options for merchants to tailor checkout flows to their branding and needs. But this also means that the setup requires technical knowledge and might not be easy to use for non-tech-savvy people.
PayPal presents a better, user-friendly interface with minimal setup needed. Plus, your customers can pay easily using email and existing PayPal accounts without redirects or multiple logins.
When it comes to access, you can use your credentials to access your PayPal business account easily. In contrast, Stripe requires you first to request an invitation, and only once approved, does it allow you to use it.
Currency, country, and payout coverage: How wide is the reach?
Both Stripe and PayPal are global payment platforms, which means they provide your business a pretty good reach and opportunity to scale.
While Stripe allows you to send and receive transactions in more than 46 countries in over 135 currencies, PayPal reaches over 200 countries and supports 25 currencies. Both of them allow transactions in almost all the major currencies, such as USD, CAD, AUD, EUR, GBP, INR, and JPY.
Stripe vs PayPal India: Use-case breakdown
Stripe and PayPal both cater to different types of customers, including freelancers, startups, and businesses. Let’s see how.
1. Freelancers
PayPal
Works best for freelancers who want a quick, easy setup and multiple payment options, like PayPal balance, cards, ACH, etc. Because there is no technical expertise required, it’s very convenient for small-scale or frequently paid freelancers.
Stripe
Best suited for freelancers with some technical background who want lower fees, highly customizable payment acceptance, real-time analytics, and automation for recurring payments.
2. Businesses
PayPal
Useful for small to medium-sized businesses that are focused on cross-border sales with minimal amount of integration effort. Support for invoicing, marketplace integration, and buyer/seller protection are added benefits that build trust for international customers.
Stripe
Excels for businesses needing custom APIs, extensive integration with ecommerce and billing systems, and support for subscription or SaaS billing models. The sophisticated fraud detection and extensive currency and payment method options make it perfect for digitally native or technically advanced businesses.
3. Startups
PayPal
Offers fast market entry and simplicity, which makes it good for startups with limited developer resources or those launching quickly on marketplaces where PayPal is trusted.
Stripe
Preferred by startups that are expecting rapid growth and are in need of deep payment infrastructure flexibility. Stripe’s API-first platform supports innovative billing scenarios and international expansion, giving them a lot more control over user experience and pricing.
How Xflow compares to Stripe and PayPal
As discussed, Xflow is also a payment platform that caters to the specific needs of Indian businesses when it comes to receiving cross-border payments. Here’s how Xflow compares to Stripe and PayPal:
- Next-day business settlements with 50% savings on FX costs.
- Transparent pricing with no hidden charges.
- Mid-market linked FX rates with zero markup.
- 24/7 withdrawal benefit.
- Free eFIRA generation within 24 hours of the transactions, making compliance easier.
- Local receiving accounts to help clients pay in preferred payment methods.
- Limitless transactions in a single invoice.
- FX AI Analysts to predict USD/INR exchange rates, helping you convert at the most favorable rate.
Pros & cons of Stripe and PayPal
The table below gives an overview of the pros and cons of both Stripe and PayPal.
| Factor | Stripe | PayPal |
|---|---|---|
| Pros | Secure payments with a wide global reach. Easy to set up recurring payments. API-friendly and customizable checkout. | Global reach and trust. Easy to use and set up. Seller protection saves from fraudulent chargebacks. Payment security with encryption and fraud detection. |
| Cons | Invite-only basis in India. No issuance of eFIRA. High fees. Requires some developer knowledge. No payments through bank transfers or SWIFT in India. | Limited customization. Higher and more complex fee structure. Reports of occasional frozen funds. |
Wrapping up: Which one should you choose?
With a clear picture of what Stripe and PayPal bring to the table – from their fee structures to how payouts actually work – you’re now better equipped to choose the platform that fits your workflow. The key is alignment: pick the one that matches your business goals, offers transparent pricing, and provides the right set of tools to help you grow sustainably. Above all, make sure the platform keeps your hard-earned money working for you, not against you.
Xflow is the platform that ticks all those boxes: transparent, reliable, and built to simplify cross-border payments, so you can focus on your work instead of worrying about your payments.
Don’t let high fees or complex transfers eat into your earnings. Make the most of your international funds – sign up with Xflow today and let payments be the easiest part of your business.
Frequently asked questions
Stripe is a payment platform that provides APIs and SDKs for customization of payment solutions. PayPal also helps with payments with an easier setup, but limited customization features. However, both of them come with high fees.
Xflow is another payment platform that makes cross-border payments for businesses extremely hassle-free, affordable, and compliant with Indian regulations, making it the best choice among all three platforms.
Xflow charges the lowest fee and comes with zero markup, which makes it the cheapest for cross-border payments. Its pricing plan depends on your invoice value. Here’s how:
Starter: Up to $2,000.00 incurs a fee of $12 and 0.6% above that amount.
Growth: Up to $5,000.00 will cost a fee of $20, and 0.4% above it.
PayPal can be used directly by Indian businesses. But for Stripe, you’ll have to request a sign-up, as it is available only on an invite-only basis.
Xflow provides free eFIRA for every transaction, which is necessary for compliance with RBI and FEMA. Apart from that, it also helps with SOFTEX and EDPMS flows and keeps your data secure with its ISO 27001 and SOC 2 certified credibility.
Usually, Xflow provides fast INR settlements. With it, your payments get settled within just 1 business day.
Both Stripe and PayPal have disclosed their fees on their platform. But both of them are known to charge a high transaction and currency conversion fee.
If you run a SaaS business or are a freelancer, Xflow presents a pretty affordable solution with a wide set of features, like invoice creation, real-time payment tracking, eFIRA issuance, marketplace integration, payment links generation, and smart FX management.
