PayPal is an online payment system that gained worldwide popularity in the last two decades. PayPal is a pioneer in online payment systems. It was founded by Max Levchin, Luke Nosek, and Peter Thiel in 1998 and quickly became a household name in online money transfers and was bought in 2002 by eBay. To look at other companies similar to PayPal, we need to understand what PayPal is and how the platform works. Essentially, PayPal is a digital Wallet. After opening a PayPal account, you can store your debit or credit card information in your account or even your bank account information.
The different payment methods stored in your account then let you make online payments when shopping online. The reasons for PayPal's popularity were security, fast transactions, and rewards. People didn't have to leave their bank account information on every online store they visited. Many businesses accept PayPal as a mode of payment on their websites and online stores or even while shopping in their physical stores. According to PayPal (https://www.paypal.com/ke/home), they currently have over 200 million active users and over 7 million businesses using the platform. Admittedly, the platform has made life much easier.
Even though PayPal is a pioneer in online payments, people now have other options for online payments. So which companies are similar to PayPal? We have companies like Payoneer, Square, Skrill, WePay, Venmo, and many more, providing stiff competition to PayPal. Below are ten companies that provide similar services to PayPal.
10. Shopify Payments
Shopify Payments is a built-in payment processing system with the Shopify platform. It allows businesses or users to start processing payments immediately after Setting up an account. Most businesses love using this payment option because they don't have to integrate an outside payment provider. In addition to its low monthly charges, businesses get its all-inclusive merchant toolset, including web design tools, administrative abilities, inventory management, security, hosting, customer service features, shipping, and many more. Shopify payments accept major credit cards like Visa, MasterCard, and American Express. Online stores can easily manage international payments as they can sell in multiple currencies. A fee of 1% is charged for international credit card transactions. Card processing fees depend on the Shopify plan selected by the merchant.
- It has flexible payment methods; customers don't have to leave the site to check out and can pay using debit, credit cards, or PayPal.
- It is easy to use, users don't have to sign up for third-party processors, and it is easy to track inventory and facilitate accounting and reporting.
- It is only available in a few regions.
- It charges users monthly and additional fees if you use a third-party gateway.
9. Amazon Pay
Amazon Pay is a top competitor to PayPal. It is definitely at the top of the list of online payment methods for store checkouts. The difference with PayPal is that it does not support bitcoin transactions or ACH payments. Amazon Pay has portals for merchants, charities as well as shoppers. Individuals can store credit, debit card, and bank account information in their accounts. At the same time, Merchants and Charities can use Amazon Pay as a payment or checkout option for their online stores and websites. There are no monthly fees for accounts, and it offers flexibility with no long-term contracts. Amazon pay charges 2.9% + 30 cents for every online transaction. There is a 3.9% + 30 cents fee per transaction for international payments.
- The platform doesn't charge monthly account fees and provides flat rate pricing.
- Amazon pay offers flexibility with no long-term contracts
- It is simple to integrate into a business website
- It doesn't support in-person payments
- Has no customization options, especially for high-volume businesses
8. Google Pay
Almost everyone with a smartphone has a google account, and Google pay takes advantage of that fact. In 2013, Google pay was introduced as a digital payment method. In 2018, Google introduced the Google Pay digital wallet, and in 2020, Google Pay launched a mobile app. Google Pay consolidated the former Google Wallet, and Android Pay features into one service. Offering online payments and money management features, Google Pay is an excellent option for people to store their card information in an e-wallet.
According to The Ways to Wealth, Google pay offers excellent peer-to-peer money transfer capabilities like tap-to-pay, tracking transactions, and linking up loyalty accounts. Although the previous version of Google pay did not charge transaction fees for peer-to-peer transactions, now Google pay charges a 1.5% fee for money transfers into a Google Pay account from a debit card and vice versa.
- Gives users control over how the company will use their data and over privacy settings
- It is easy for users to view transaction histories with various merchants
- Business owners can receive online payments from Google Pay from their websites as well as payments in their Physical stores
- Users can only send money to other Google Pay users.
- It has a 1.5% fee for transfers into a Google pay account from a debit card, unlike similar platforms that don't charge a fee.
Square is at the top of the list of companies providing great payment solutions for small to medium-sized businesses. Founded in 2009, Square aggregates merchant services and mobile payments into one easy-to-use service. Now, many business owners use the platform to accept credit and debit card payments, track sales and manage inventory. Square offers two main plans for businesses and in-person transactions. Square point of sales allows businesses to process debit and credit card payments, accept cash, cheques, and gift cards, process transactions offline, collect and manage client information and track inventory in real-time, among other functions. Square for Retail allows businesses the luxury of quicker sales through the search-based point of sale; they can track, transfer and adjust their inventory, create customer profiles, and even manage vendors.
The great thing with Square is that there are no setup fees, monthly fees, hidden fees, or PCI compliance fees. Square charges 6% + 10 cents for every in-person transaction using Square reader, square stand, square terminal, Square for restaurants, and square Register, and 5% + 10 cents for transactions using Square for retail or square appointments. It charges 5% = 15 cents for manual card payments and either 9% + 30 cents or 6% + 30 cents for online payments depending on your subscription.
- Square offers flexible terms with no long-term contracts.
- It has an easy application process
- Comes with an online store and a free domain
- It offers extra add-ons and customization services for businesses
Square is only available in Japan, U.S, Canada, U.K, and Australia.
Not the best platform for high-risk businesses
Skrill is a digital wallet company that offers money transfer and online payment services. Initially founded in 2001 in the U.K as Moneybookers, Skrill has risen to a top e-payment provider in Europe. Since its launch, Skrill has expanded its operations to over 180 countries, with over 135 different currencies. In 2015, Skrill was acquired by the PaySafe Group. In 2018, the platform expanded its services portfolio and started an international money transfer service and a crypto service that allows users to trade and buy cryptocurrencies.
The platform has a rating of 4.2 out of 5 on Google play and 4.6 on the IOS app store. Opening a Skrill account and sending to and receiving money from an overseas bank is account free. Depending on their location, Skrill users can get a Skrill prepaid card that they use to pay for things in stores or even withdraw money from ATMs. Skrill charges 4.99% per transaction for international transfers, a $5.50 withdrawal fee from ATMs, a $10 annual fee for the prepaid card, and a $5 service fee for accounts that have been dormant for more than 12 consecutive months.
- Allows for payments and withdrawals across e-commerce and online gaming platforms.
- Easy money transfers using only email addresses or phone numbers
- Allows for the trading of cryptocurrencies
- Skrill is available in over 180 countries and supports over 135 currencies.
- The platform requires some technical understanding.
- Its In-person transactions are limited.
5. We Pay
We pay is an online payment system owned by JP Morgan Chase company. It has integrated its online payment solutions to mainly SaaS and Crowdfunding platforms like GoFundMe, Xero, TouchBistro, and FreshBooks. The platform API lets these software vendors integrate into their system. That way, customers are not redirected during checkout. We Pay offers three primary services; Link, Clear, and Core. For the We Pay Link option, customers pay 2.95% + 30 cents for every card transaction and a 1% + 30 cents fee for ACH payments.
- It is a good platform for crowdfunding
- Relatively cheap ACH payment fees
- Account setup is free, and there are no monthly charges
- Customer support is only available via email
- We Pay does not offer in-store payments.
Stripe has become one of PayPals fiercest competitors. The platform was founded in 2011 and offers many online payment features. Stripe collects customer payments and sends the payments to the bank, including bitcoin and ACH transactions. With stripe, users can make payments through credit and debit cards like Visa, Master card, and American Express. Stripe has integrated payments through numerous digital wallets, including Google Pay, Apple Pay, We Chat, and many more. According to Stripe's Website, many companies use its software and APIs for payments and online business management for companies such as Amazon, Google, Slack, Zoom, and Shopify. Stripe charges users 2.9% + 30 cents for online transactions and an additional 1% for international transactions requiring currency conversion and 2.7% + $5 for in-person transactions.
- No setup or monthly fees and a flat rate on all transactions.
- Stripe supports so many payment methods and currencies
- Stripe has a 24/7 customer support line via email, phone, and live chat.
- International transactions require an additional 1% fee.
- It might pose challenges for users with little to no software development knowledge.
Most people living in the U.S likely have a Venmo account. In 2009, Venmo was launched by Andrew Kortina and Iqram Magdon-Ismael as a money management service for friends and family who wanted to split bills. In 2013, Venmo was acquired by PayPal. In its early years, Venmo only supported peer-to-peer transactions, but in 2015, it started allowing businesses to get paid via the platform. Users can choose to get a Venmo debit card powered by MasterCard. Venmo transactions from debit cards, the user's bank account, or their Venmo cash balance are free, but credit cards attract a 3% fee for the sender. You can either choose the instant money transfer option to any U.S bank account for a fee of 1.75% or the standard option, which takes three to five business days and is free.
- Venmo offers quick, easy, and convenient payments.
- No fee charges for money transfers to bank accounts or debit cards
- Offers both a debit card and credit card to its users
- Users can pay directly to businesses with Venmo accounts
- Users have no payment cancellation option
- Venmo does not provide for international transactions and is only available to people and businesses in the U.S.
This American Financial services company is a popular alternative to PayPal. Like PayPal, Payoneer provides digital payment services like online money transfers. Founded in 2005, Payoneer has risen to become one of PayPal's stiff competitors. According to Nerd Wallet, it is available in more than 200 countries and more than 150 currencies. Payoneer attracts all kinds of people, from business owners to freelancers.
It is incredibly functional for freelancers because it supports international payments through integration with marketplaces like Upwork, Airbnb, Fiverr, Getty Images, Google, Amazon, and many more. Payoneer users can physically get debit cards to pay for goods and services and withdraw money from ATMs. Setting up a Payoneer account is free. ATM withdrawals from your local bank are charged at 2% above the market rate. Money withdrawn from another bank account but in the same currency is charged $1.50, and payment to non-Payoneer accounts is charged 1% to 3%, depending on the payment method. Accounts that remain dormant are charged $29.95 every 12 months.
- Free account signup and free payments for transfers between Payoneer accounts.
- Useful integrations for international money transfers, especially for freelancers
- Payoneer is available in almost every part of the world
- Payoneer, unlike Paypal, charges for bank transfers.
- Huge withdrawal fees for ATMs
- It doesn't provide for payment gateways or the ability to work with POS systems.
Wise, formally known as TransferWise, was launched in 2011. Its mission is to make international money transfers faster, easier and cheaper. True to its mission, Wise offers a cheaper alternative for international money transfers than PayPal. Businesses, freelancers, and consumers can send, receive and pay for things in many countries for a small fee. Wise has gained popularity, with the platform hosting over 12 million users and users being able to send money to over 80 countries. Wise accounts are compatible with google and Apple pay, and personal customers in over 200 countries have access to a Wise international debit card.
- Wise has low and transparent fees and no hidden costs.
- Fast transfers with a maximum of 24 hours to be delivered
- Users can transact in over 50 currencies
- Does not support transfers for cryptocurrency or forex trading merchants
- Only supports payments in the form of bank transfers
Although PayPal is an industry pioneer in online payment solutions, other companies offering similar services are available. The list above is diverse, with some companies offering better services for personal money transfers while others are more suited to businesses. You can choose which service provider to use based on your personal or business needs.
Written by Allen Lee
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