PayPal is the largest online payment service around thanks to being owned by eBay. It is good at what it does but is a perfect example of a service built around the needs of the company instead of the needs of its users. Customer service is woeful, charges are quite high, especially for currency conversion and the arbitrary banning of accounts is no good for small businesses.
While PayPal has enjoyed market dominance for a number of years, that is changing. A range of upstarts and new ventures, as well as some big names are joining the online payment industry. With the Internet of Things fast approaching and mobile payments really taking off, the time is ripe for some healthy competition.
Here are ten PayPal alternatives for the home user or small business I think are worth checking out.
1. Google Wallet
It’s inevitable that Google would want to get in on the action and Google Wallet does just that. It used to be Google Checkout but has had something of a transformation and is now a viable alternative to PayPal, but only if you’re a merchant. It works in conjunction with other Google services, links to your bank account and works in a similar way to PayPal. It also has the advantage of working as a complete digital wallet so can enable NFC payments.
WePay is another alternative that makes paying online simple. This is another one for business and uses a web API to include a digital payment terminal in your website. This allows customers to buy products and services there and then and is a simple way to get into ecommerce with very little programming knowledge. The system is straightforward and works well but doesn’t have the person to person payment capability of PayPal.
Skrill is a payment site that works for individuals. You can send payments to other users, pay with a debit or credit card and send money across borders. Skrill is more a person to person payment platform rather than an all-encompassing one so enables the other side of online payments. While it supports businesses, there are very few popular enterprises who accept Skrill right now.
2Checkout is a more rounded PayPal alternative for both the home user and small business. It allows people to send money to each other and to pay for things online. You can transfer, accept other currencies and it works in over 85 countries. There are also invoice options, mobile payments, decent fraud protection and the customer service is supposed to be pretty good too.
Authorize.Net is a serious sounding name for a company that has been in the payments game for over ten years. It is more for ecommerce and business than sending money to friends, but works well and the website is a breeze to use. The process is simple, over 400,000 merchants use it and the security is supposed to be excellent. There is however a $49 setup fee which is a shame.
If you run a small business, you may already have heard of Intuit as they own QuickBooks, the accounting software. This is another business-oriented payment gateway but is one that works well, integrates with QuickBooks and offers many of the same invoice and ecommerce services as PayPal. You can’t pay person to person though so isn’t of use if that’s what you’re after. As a merchant you can accept mobile payments and bank transfers though.
Stripe works for both individuals and merchants and is a very popular choice. It automatically transfers payments to your bank account, allows mobile payments, accepts payments from both companies and individuals and works well. What isn’t so great is the delay of a few working days before you get your money. While not a showstopper, is slightly disappointing in this age of instant payments.
Payoneer is another popular PayPal alternative. It allows payments from people and companies, works in many countries, works with mobile payments and gives you a debit card that you can use in person or at an ATM. Payoneer has a large global presence and is accepted in most places. The downsides are some hefty fees to withdraw money and use the card though, so be aware if you join.
Dwolla is a universal payment gateway for individuals and business. It does most things PayPal does but with lower fees and more security. The interface is simple, the payment process straightforward and the barrier to entry is very low. It isn’t as popular as it should be so not everywhere accepts it. The downsides are that you have to link your bank account as Dwolla won’t work with debit or credit cards.
10. Amazon Payments
Amazon Payments is primarily for online merchants but has personal payment options too. It uses your Amazon account for everything, so is quick to login and manage your finances. There are no fees for transactions under $1000, it has very good security and the backing of decent customer service. The downsides are that you can only send money to U.S. citizens or businesses and integrating the ecommerce side of payments takes a little work.
I have tried to include a real mix of those geared up for businesses and those that work for individuals too. A couple do both credibly well and will work as a viable alternative to PayPal. Some are more popular than others and some deserve to be more popular than they are.
While there is nothing inherently wrong with PayPal, it has enjoyed market dominance for far too long. It is geared towards pleasing itself rather than its customers and you are often left at its mercy. However, it is by far the most accepted and well known payment gateway out there for now so if compatibility is your concern you might want to select one of the bigger names on here.
Do you use a payment gateway I haven’t mentioned in this list? Know of one worth our time? Tell us about it below!