TL;DR
Most people looking for a PayPal alternative want one of two things: lower online fees, or less risk of a hold on their money. We read each provider's own pricing page (prices checked Oct 2026) and ran the fees through one engine at a $50 average sale.
- Lowest cost with no monthly fee: Helcim. Interchange-plus pricing, no contract. At $50K a month online our engine puts Helcim at $1,275 against $1,735 on PayPal's cheapest card rate.
- Online stores, subscriptions and custom checkouts: Stripe. 2.9% + 30¢ against 3.49% + 49¢ for the PayPal Checkout button, a $15 dispute fee against PayPal's $20 chargeback fee, and a documented way to take your saved cards with you.
- Steady volume and room for a monthly fee: Stax. Interchange at cost plus a subscription. Online it costs $1,200 at $50K a month and $5,200 at $250K, against $1,735 and $8,675 on PayPal.
One honest note before you leave: if you sell in person, PayPal's point-of-sale rate of 2.29% + 9¢ is the lowest flat in-person rate we found. Square and Stripe charge more at the counter. Only the interchange-plus providers beat it.
Why businesses leave PayPal
We did not survey anyone. The reasons below come from PayPal's own fee page (prices checked Oct 2026) and its US User Agreement (checked Nov 2026).
The fee depends on which PayPal product you are on
PayPal sells several card products at different prices. The PayPal Checkout button costs 3.49% + 49¢. Standard card payments cost 2.99% + 49¢. Advanced Credit and Debit costs 2.89% + 29¢, but needs PayPal's approval. The 49¢ fixed fee weighs most on small orders. International sales add 1.5%, a chargeback costs $20, and an instant transfer to your bank costs 1.5% with a 50¢ minimum.
Our engine prices PayPal on Advanced Credit and Debit, its cheapest online card rate, at 3.47%. If you are on the Checkout button, your real cost is higher than that.
Holds of up to 21 days, or up to 180
The User Agreement says PayPal may hold payments sent to you if, in its sole discretion, it believes there may be a high level of risk. In its words, "Risk-based holds generally remain in place for up to 21 days from the date the payment was received." If the payment is disputed, PayPal holds it until the matter is resolved, "but no longer than 180 days." Earlier release, for example after you upload tracking, is at PayPal's discretion.
Account limitations
PayPal can also limit an account. When it does, it may hold your business balance "for up to 180 days if reasonably needed to protect against the risk of liability" or if you broke its Acceptable Use Policy. The agreement lists the kind of seller behavior it treats as high risk, including an unusually high number of claims and chargebacks, selling an entirely new or high-cost product type, or sales volume that increases rapidly. That last one can apply to a business that is simply growing.
Reserves
PayPal "may place a reserve on your business account at any time" if it believes there may be a high level of risk. It describes two types. A rolling reserve holds a percentage of each day's sales and releases it later; PayPal's own example is 10% held for 90 days. A minimum reserve is a fixed amount you must keep in the account, taken up front or built from a share of sales. PayPal notifies you of the terms, but its decisions "may be based on confidential criteria," and you agree it has no obligation to disclose the details of its risk management.
None of this is unique to PayPal. Stripe and Square also reserve the right to hold funds, as their sections below note. The difference is how much of your revenue sits with one company. Our guide to capped and rolling reserves explains how the two types hit cash flow.
PayPal alternatives compared
Headline pricing, contract terms and payout speed for five alternatives, with PayPal as the reference row. Fees from each provider's pricing page, prices checked Oct 2026.
| Provider | Headline pricing | Contract | Payouts | Best for |
|---|---|---|---|---|
| PayPal (reference) | Checkout 3.49% + 49¢; Advanced Credit and Debit 2.89% + 29¢; POS 2.29% + 9¢ | No long-term commitment for PayPal POS | Standard withdrawal free; instant 1.5% | Sellers whose buyers want to pay with PayPal |
| Helcim | Interchange + 0.50% + 25¢ online, + 0.40% + 8¢ in person under $50K a month, lower above; $0 monthly | No contract | Next business morning, free | Small and mid-size merchants who want interchange-plus with no monthly fee |
| Stripe | 2.9% + 30¢ online; 2.7% + 5¢ in person; $0 monthly | Pay as you go | 2 business days; instant 1.5% | Online stores, SaaS and subscriptions |
| Stax | Interchange at cost + 15¢ online, + 8¢ in person; $99 to $199+ a month | No cancellation fees stated; length not published | Next business day | Steady volume from about $50K a month online |
| Square | 2.6% + 15¢ in person; 3.3% + 30¢ online on Free, 2.9% + 30¢ on paid plans | No contract | Next business day free; instant 1.95% | In-person sellers who want a free POS app |
| Shopify Payments | 2.9% + 30¢ online on Basic, lower on higher plans; Shopify plan required | Plans billed monthly or yearly | 3 business days | Stores on Shopify |
What it costs each month
Effective rates and monthly costs from our ranking engine at a $50 average sale. For Helcim and Stax the engine adds an interchange estimate of 1.7% online and 1.55% in person, for a 60% credit, 40% debit mix. PayPal is priced on Advanced Credit and Debit online and PayPal POS in person. Shopify's plan fee is left out because you pay it for the store, not for processing.
| Online sales | $10K a month | $50K a month | $250K a month |
|---|---|---|---|
| PayPal | 3.47% / $347 | 3.47% / $1,735 | 3.47% / $8,675 |
| Helcim | 2.70% / $270 | 2.55% / $1,275 | 2.45% / $6,125 |
| Stripe | 3.50% / $350 | 3.50% / $1,750 | 3.50% / $8,750 |
| Stax | 2.99% / $299 | 2.40% / $1,200 | 2.08% / $5,200 |
| Shopify Payments (Basic) | 3.50% / $350 | 3.50% / $1,750 | 3.50% / $8,750 |
| In-person sales | $10K a month | $50K a month | $250K a month |
|---|---|---|---|
| PayPal POS | 2.47% / $247 | 2.47% / $1,235 | 2.47% / $6,175 |
| Helcim | 2.11% / $211 | 2.04% / $1,020 | 1.94% / $4,850 |
| Stax | 2.70% / $270 | 2.11% / $1,055 | 1.79% / $4,475 |
| Stripe Terminal | 2.80% / $280 | 2.80% / $1,400 | 2.80% / $7,000 |
| Square | 2.90% / $290 | 2.90% / $1,450 | 2.76% / $6,900 |
Read the tables together. Online, Stripe and Shopify Basic cost about the same as PayPal's cheapest card rate, and less than the Checkout button. In person, PayPal POS beats every flat-rate option. The real saving comes from interchange-plus. The full ranking is on our best payment processors 2026 page.
Helcim
Best for: small and mid-size businesses that want to pay less than PayPal, online and in person, with no monthly fee.
Helcim charges the card network's cost plus a published margin: 0.50% + 25¢ online and 0.40% + 8¢ in person under $50K a month, stepping down at $50K, $100K, $500K and $1M. There is no monthly, setup, PCI or cancellation fee. Deposits arrive the next business morning, free.
It is the only option in this comparison that undercuts PayPal at every volume we test on both channels. At $10K a month in person it costs $211 against $247 on PayPal POS.
Watch for: your rate moves with your card mix. Online sales carry a 25¢ fixed fee under $50K a month. A lost chargeback costs $15, recurring payments add 0.4%, and there is no instant payout. Helcim does not give you a PayPal button, so if your buyers expect one, you will need to keep PayPal for that.
Stripe
Best for: online stores, SaaS and subscription businesses that want control over their checkout.
Stripe charges 2.9% + 30¢ online and 2.7% + 5¢ in person, with no monthly fee. Next to the PayPal Checkout button at 3.49% + 49¢, that is a clear saving. Next to PayPal's Advanced Credit and Debit rate it is about even: 3.50% against 3.47% in our engine. Disputes cost $15, plus $15 more to counter, refunded if you win. Stripe also documents how to export saved cards to a new processor if you ever leave it, which matters for subscriptions.
Watch for: Stripe has its own reserves, fixed and rolling, and its Services Agreement lets it close an account at any time unless agreed otherwise in writing. The first payout typically takes 7 to 14 days, then 2 business days after that. Keyed cards add 0.5%, international cards add 1.5%. Our Stripe vs PayPal page compares the two product by product.
Stax
Best for: established businesses with steady volume, from about $50K a month online or $250K in person.
Stax charges interchange at cost with no percentage markup, plus 15¢ per online sale or 8¢ in person, plus a monthly subscription: $99 up to $150K a year in volume, $139 from $150K to $250K, and $199+ above. Funding is next business day.
At $250K a month it is the cheapest option in this comparison on both channels: $5,200 online against $8,675 on PayPal, and $4,475 in person against $6,175.
Watch for: the fee is due in slow months too, which hurts seasonal sellers. At $10K a month in person, Stax costs $270, more than PayPal POS at $247. Contract length and PCI and setup fees are not published, so ask in writing.
Square
Best for: in-person sellers who want a free POS app, no contract and free next-day deposits.
Square's $0 plan charges 2.6% + 15¢ in person and 3.3% + 30¢ online. Plus ($49 a month per location) and Premium ($149) lower in-person rates to 2.5% and 2.4% + 15¢ and online to 2.9% + 30¢. Standard transfers arrive the next business day, free.
Square is not cheaper than PayPal POS. Our engine puts it at $290 at $10K a month in person against $247 on PayPal. People pick Square for the software: a free POS app on the $0 plan, and paid plans built for food, retail and appointment-based businesses. See PayPal vs Square for the full split.
Watch for: instant and same-day transfers cost 1.95%. Square's payment terms also say it may withhold funds or require a reserve "for any reason related to your use of the Services," so moving to Square does not end the hold risk.
Shopify Payments
Best for: stores that already run on Shopify.
Online rates are 2.9% + 30¢ on Basic, 2.7% on Grow, 2.5% on Advanced and from 2.25% on Plus. In person it is 2.6% + 10¢ on Basic, and the Tap & Chip reader costs $49. If you use another processor instead, Shopify adds a 0.2% to 2% fee per sale, so on Shopify this is usually the cheaper way to take cards.
Watch for: it only works inside Shopify, and you need a Shopify plan (Basic is $29 a month billed yearly). US payouts take 3 business days.
How to switch from PayPal
- Find your real rate. Add up three months of PayPal fees, including currency, chargeback and instant transfer fees, and divide by sales. Check which product you are on: Checkout, standard card or Advanced Credit and Debit. Our guide to reading a merchant statement shows what to look for.
- Get the new account approved first. Do not move volume until underwriting is done. Ask for contract length, monthly minimums and termination terms in writing.
- Decide whether to keep a PayPal button. Some buyers only pay with PayPal. You can move card processing to a cheaper provider and leave PayPal as one option at checkout, so you only pay PayPal rates on PayPal orders.
- Run both for a few weeks. Send part of your sales through the new processor. Check that deposits arrive on time and that the fees match the quote.
- Plan for saved cards and subscriptions. Ask PayPal in writing whether payment methods saved with it can be moved to your new processor. If not, plan to ask subscribers to re-enter their card at the new checkout before their next billing date.
- Update payment links and invoices. Replace PayPal payment links, invoice templates and buttons on your site, email footers and social profiles.
- Do not close the PayPal account early. A disputed payment can stay on hold for up to 180 days under PayPal's terms, and reserves release on their own schedule. Leave the account open and withdraw funds as they become available. If funds are already held, see what to do when funds are frozen.