Stripe vs Paddle
Stripe vs Paddle: payment processor vs Merchant of Record. Tax handling, fees, usage billing, dispute risk, API quality. Decision matrix for SaaS founders.
Pick Stripe if…
Use Stripe when you have (or will hire) finance ops, want lowest fees, and can handle global tax compliance yourself.
Best for: B2B SaaS with finance/ops in place, marketplaces, anyone optimising for fee %.
Pick Paddle if…
Use Paddle when you want zero tax/VAT/compliance overhead — Paddle is the merchant of record and handles every jurisdiction for you.
Best for: Solo founders, micro-SaaS, anyone selling globally without a finance team.
Across 7 criteria: Stripe wins 5, Paddle wins 2, ties 0.
| Criterion | Stripe | Paddle | Winner |
|---|---|---|---|
| Fees (typical) | ~2.9% + 30¢ | ~5% + 50¢ | Stripe |
| Tax / VAT compliance | Stripe Tax (paid add-on) | Included — Paddle is MoR | Paddle |
| Subscription primitives | Mature — Prices, Products, Meters | Mature | Stripe |
| Usage-based billing | Stripe Meters (2024+) | Paddle Usage | Stripe |
| Marketplace / split payouts | Stripe Connect (mature) | Limited | Stripe |
| Global card coverage | Largest | Large | Stripe |
| Dispute handling | You handle disputes | Paddle handles disputes | Paddle |
Stripe pros
- +Lowest fees
- +Largest ecosystem & API surface
- +Mature Connect for marketplaces
- +Stripe Meters for usage billing
Stripe cons
- −You must handle global tax (or pay Stripe Tax)
- −You absorb dispute risk
Paddle pros
- +Zero tax/VAT/GST handling
- +Single dispute interface — Paddle absorbs them
- +Single global checkout
- +Cleaner if you sell into 50+ countries solo
Paddle cons
- −~2× the fees of Stripe
- −Smaller API surface
- −Limited marketplace support
Frequently asked
Can I switch from Paddle to Stripe?⌄
Yes — many SaaS start on Paddle (zero tax overhead) and switch to Stripe at $50K+ MRR when the fee delta justifies hiring finance ops. Migration is a 2-4 week project.
Does Stripe handle EU VAT?⌄
Stripe Tax (paid add-on, ~0.5%) calculates and remits VAT/GST. You still file in each jurisdiction. Paddle, as MoR, handles filing for you.
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