Stripe and Square have emerged to be popular payment processing services, particularly for small and growing businesses. They both have simple fixed-rate processing fees that may greatly benefit business owners and investors. They have even started to attract big-name supporters recently. However, Stripe and Square are not entirely similar; they each have different unique advantages and limitations. Continue reading below for the detailed comparisons between Stripe vs Square!
Stripe is widely considered as an excellent choice for a new business or digital startup in this modern world. Stripe has been designed to help you establish a solid payment processing platform that can grow with your business. It is often praised for its powerful API, which is much better than PayPal’s (take a look at the comparisons between Stripe vs PayPal here!). With the help of a good developer, you can tailor and customize Stripe to suit your business’s needs and workflow.
Stripe accepts all major debit cards and credit cards. In addition, the difference between Stripe vs Square is that Stripe also supports other payment methods, such as Android Pay, Apple Pay, Bitcoin, ACH, and AliPay. With these features, Stripe becomes very versatile. It is suitable for various customer transactions, most particularly online transactions. It is also great for taking care of huge corporate clients, as it supports Bitcoin and ACH.
In addition to the payment processing service, Stripe can also give assistance in the whole range of business operations. Stripe Atlas allows a company, inside or outside the US, to have a digital US bank account and incorporate as a US business. All the complicated process is handled by Stripe for a flat fee of $500. The bundle includes a free Amazon Web Services credit of $5,000 and a free conversation with an accountant and lawyer. Flat-rate packages of additional legal and tax services are available.
Stripe Processing Fees
Stripe doesn’t have any monthly fee. Instead, it only takes a transaction fee of 2.9% + $0.30. This is great if you are worried about having to spend money while your business is still struggling. The lack of a monthly fee means that you won’t be spending any money when you are not selling.
Note that the transaction fee may quickly add up on a large volume of micropayments. You may need to reconsider your options if you often handle a lot of transactions with small amounts.In addition, Stripe has a conversion fee of 2% per transaction for international sales, which is pretty high. Nevertheless, the $15 chargeback rate is quite competitive.
Stripe User Experience
Stripe makes everything so easy, especially for someone who is just about to start a business. If you want to build a US corporation, Stripe Atlas is most probably the easiest way to do so. Stripe also has the ability to analyze your transaction data through Stripe Sigma. You can sell other people’s products on your channels by using Stripe Relay. The whole feature set will allow you to understand better about the market and expand your business in many possible ways.
The available integrations are great. Some notable ones include WordPress, Shopify, Bubble, WooCommerce, Squarespace, and Zapier. With these integrations, you can easily employ and customize the service. If you need a highly customized integration, the API is truly powerful and effective.
Square is somewhat different compared to other payment processing services. Well, it does provide similar services like Stripe, but it has its own distinctive selling point, which is the Point of Sale (POS) system. When you sign up on Square, they will send you a card reader for managing transactions in a physical store. Contactless readers are available at an additional fee.
This way, all your offline and online sales can go through the same platform. It will be much easier for you to track and manage your business’s performance. For sure, Square supports all debit and credit cards that people usually use.Square also has an NFC reader that supports Apple Pay and Android Pay.
Furthermore, Square comes with additional features for managing physical sales and service provision. The calendar and booking system is great. It will enable your customers to book and pay online transactions easily.
Finally, one distinction between Stripe vs Square is that Square offers virtual loans for business owners. The virtual loans are based on your business’s performance – this isn’t surprising. Since almost all your sales are routed through the platform, they can use machine learning to analyze and calculate what kind of loan that is suitable for you. Don’t worry very much about missing a loan payment because Square can automatically take loan repayments from your sales. You can see if there is any loan offer available in your Square dashboard.
Square Processing Fees
The next difference between Stripe vs Square is the transaction fees. Similarly, there is no monthly fee to be worried about. But the transaction fees are a little more complicated to calculate.
First of all, Square can give you a magstripe reader for free. However, if you want to upgrade, you will have to pay the add-on cost. The chip card reader costs $29, the contactless reader costs $49, and the stand costs $99.
For online payments, the transaction fee is similar, which is 2.9% + $0.30. However, a swiped or contactless payment has a transaction fee of 2.75%. A manually entered payment has a transaction fee of 3.5% + $0.15. Note that the Square Register has its own set fee which is 2.5% + $0.10.
In most cases, the fees of Square are competitive. You can get good profits from them until your total earning is more than $17.6k from monthly transactions. From this point, you may want to see other alternatives to start saving some money. Meanwhile, the loan offers and repayments may vary depending on your business’s performance.
Square User Experience
Square is mainly marketed towards companies that aren’t employing high-level technologies. So, unsurprisingly, simplicity becomes a key attribute. The POS software has been designed to be as easy and intuitive as possible so that non-techie employees will have no problem using it.
Nevertheless, Square Retail is indeed a bit more complex, as it is essentially a CMS for managing entire business operations. It is able to manage vendors, inventory, and wages. This is a great tool if you don’t have anything yet to manage your business’s workflow. Finally, Square does have a number of great integrations, including Quickboks, WooCommerce, Vend, TouchBistro, and IFTTT.
|- Accepts online payment methods through debit/credit cards, Android Pay, Apple Pay, AliPay, Bitcoin, ACH||- Suitable for handling both online and offline transactions, can provide card reader and NFC reader|
|- Relatively low transaction fee||- Different transaction fees for different methods; generally good to start with, may not be great for larger businesses|
|- Highly customizable to meet different needs, lots of integrations||- Focuses on simplicity and ease of use, has some integrations|
|- Stripe Atlas is a great package to start a US corporation||- May give great loan offers based on your business’s performance|
Stripe is a great choice for a business that runs only online transactions. Stripe supports multiple payment methods. In addition to the awesome API, Stripe has many powerful tools and integrations. Stripe Atlas is a very good option if you are just about to start a US corporation. On the other hand, Square is great if you need to handle both online and offline transactions on a single platform. The POS software is impressive. Square may give some interesting loan offers from time to time that are based on your business’s performance.