Stripe vs Square: What’s the difference and how to choose

If you have a business, you want to get paid for the products or services you sell. Many times your customers will want to pay by credit card or debit card or with digital wallets. That means you need a service provider that will allow you to process payments.

If you’ve spent any time researching payment platforms, you’ve no doubt come across Square and Stripe. What’s the difference between the two, and which one is right for your business? 

Find out here. 

What Is Credit Card Processing From a Small Business Perspective

Credit card processing is a broad term. There’s a lot that happens between the time a customer taps, swipes, inserts or enters their card for a transaction and when the business gets paid for that purchase. 

The purchase must be authorized by the cardholder’s issuing bank, and security checks must be run to help minimize fraudulent transactions. Data must be securely transmitted throughout the process to prevent interception by crooks. Money must be moved from the customer’s account, to a merchant account, and eventually to the seller’s business business bank account.

Fees will be charged along the way to pay for the services provided by the various companies that help process the transaction. 

Stripe and Square are payment processing companies that can help small businesses accept a variety of types of payments. Both are designed to make it easy for small business owners to get started. 

Stripe vs Square Highlights

What are the main differences between Stripe and Square? Here’s how basic pricing works: 

What is Stripe best for

Stripe is a robust and popular payment processor used by millions of businesses around the world to accept payments. It offers:

• Tools for developers  that allow them to integrate and customize payments into their e-commerce systems and websites. 
• Payment options for subscriptions and recurring payments.
• No-code payment tools for selling on social media. 

It is a favorite for many ecommerce and online businesses ranging from startups to very large businesses. 

Aaron White, CEO of Outbound.com, a marketing platform that harnesses the power of AI to automate marketing for small businesses, uses Stripe and has found it “especially simple to integrate payment processing into software. 

“They have some of the best documentation I’ve ever seen, making it developer friendly and incredibly quick for us. We also love that Stripe’s checkout experience is fully customizable, which helps match our brand without disrupting the overall customer experience,” he says. 

What are the disadvantages of Stripe

Stripe’s average rating on Trustpilot is 2.5 stars out of 5. With over 13,000 ratings, 46% were five-star ratings while 43% were one-star ratings. Either they loved the service they received from Stripe or thought it was awful. 

Aside from those reviews, the main disadvantages of Stripe are processing costs. Some businesses that process a lot of transactions may be able to get better rates elsewhere.

Gene Caballero, co-founder of Greenpal, described as “Uber for lawncare,” allows homeowners to find, schedule and pay for lawn service. He also loves Stripe, noting that it’s been easy to implement and “very consistent throughout our time working together.  All of the payouts have been seamless to our over 20,000 vendors.” 

His only beef? The fees. 

“Our (sales) volume is not seen as wholistic, and therefore (we) are not given any additional discounts,” he says. “They look at all of the vendors signed up on our platform as separate entities and therefore we are not given a break on the standard fee we have contracted with them which is 2.9% per transaction.”  

What is Square best for

Square became well-known for its easy and inexpensive POS options for businesses that want to accept credit and debit cards. It was one of the first to make a simple square-shaped POS device that could be used with a smartphone or tablet. Square Inc. became Block Inc. in 2021. 

Simplicity and ease of use are two of its advantages. In addition, Square offers offers appointment scheduling, invoicing, an online store builder and other services to help make managing your small business easier. 

What are the disadvantages of Square

Square US has fewer ratings on Trustpilot (under 5000 reviews) but the large majority (84%) were five star reviews with few one star reviews (less than 10% of reviews). The majority of reviewers praised Square’s customer service. 

Negative reviews generally referenced unresolved problems, and some seemed to confuse Square with other companies like Squarespace. 

Square doesn’t offer the variety of customization options like Stripe offers (particularly for ecommerce) and, like Stripe, some sellers may find they can get better rates from other providers. 

How to choose the best credit card processing company for you

Accepting credit cards can significantly boost your small business’s sales and customer satisfaction. However, choosing the right credit card processing company is important because it can save your business money while increasing sales. 

Here’s what to keep in mind when making your choice:

1. Fees: Understand the fees charged by the processing company. These can include transaction fees, interchange fees, processing fees, monthly fees, and even early termination fees. How are refunds handled, and will there be chargeback fees? Do thorough research to avoid hidden fees or monthly minimums.

In this case, Square fees and Stripe fees are very close, except that Stripe charges a 1% fee for international transactions.

2. Payment methods. What types of payments will you need to accept? In addition to credit cards and debit cards, do you need ACH payments, invoicing, mobile payments, digital wallets?

3. Point-of-Sale (POS) System: Consider the type of POS system you need. For in-person transactions, you’ll require a credit card reader that supports swiping, chip insertion, or contactless payments. Think about whether you need additional features like iPads for on-the-floor sales, a virtual terminal, or the ability to accept digital payments like Apple Pay, Google Pay, or PayPal.

For online transactions, consider how much customization you’ll need for your shopping cart, how sales tax will be calculated and charged, and whether you’ll accept international cards.

4. User interface: Your customers need an easy checkout experience when they make a purchase, and your employees need to find it easy to use for fulfillment and reporting purposes. Make sure the system you use works well for both. 

5. Integration: Check if the processing company’s software integrates with your accounting software, such as QuickBooks. If you have existing hardware, ensure it’s compatible with the processing company’s system.

6. Customer Support: Look for a company with reliable customer support. Even the best companies can have off days, so read reviews and avoid companies with consistently low ratings.

7. Security: Ensure the processing company handles PCI compliance and offers robust security measures. A data breach can be expensive for your business so some research here to choose a safe and reliable option. 

How To Accept Credit Card Payments

To accept credit cards and debit cards, you’ll sign up with a payment processor. If your business is a bricks and mortar business, or a business where you’ll see customers in person (like at a farmer’s market) you’ll need a way to accept physical credit cards. This is referred to as a Point of Sale system (POS system). That may mean cash registers, for example, or hand held terminals. 

Payment processor

The payment processor facilitates the payment with credit cards, debit cards, and digital wallets from the customer’s financial institution to the businesses’ financial institution.  A payment gateway is the front-end, consumer-facing part of the electronic payment processing system.

If you will accept payments online you’ll need a payment processor that facilitates online payments. If you will be making sales in person you’ll need some way to process in-person payments (usually through a POS device.) Payment processors often offer the ability to accept payments in both ways though some offer more options than others. 

Merchant account

In addition to a payment processor and any hardware, you’ll need a merchant account. A merchant account is a bank account that allows businesses to accept credit and debit card payments. The money you earn from sales will go into the merchant account (minus any fees). But then you’ll also need a business bank account where those deposits will eventually be deposited. 

Credit Card Processing Companies in 2024

Here are some top choices in debit and credit card payment processing:

Pilothouse Payments

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Chase Payment Solutions℠

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Complete Suite of Payment Solutions

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Chase Payment Solutions℠

Limited time offer: Get $100 off the Chase Point of Sale (POS)℠ Terminal. Fill out the form and ask a Payments Advisor how to claim.¹ Fast funding at no additional cost. Get deposits as soon as same day.² Get fair and transparent pricing with no hidden fees. 2.6% rate +10¢ per tap, dip and swiped transaction. 2.90% + 25¢ per eCommerce transaction and monthly fee starting at $9.95. 3.5% rate +10¢ per keyed transaction.³ Trusted security – As technology advances, our industry-leading systems help keep your payments and customers safe. Get paid fast and manage your business from anywhere with the Chase Point of Sale system. Use our mobile app, reader and terminal to take payments via tap, dip and swipe.⁴ Process payments with Chase Payment Solutions, the #1 merchant acquirer in the U.S.⁵ Tap to Pay on iPhone offers you the ability to accept contactless cards, Apple Pay and other digital wallets on your iPhone – no additional hardware required.⁵ Chase Customer Insights is a complimentary business intelligence platform that offers simple, actionable analytics and reports to help you make better business decisions and reach more customers.⁶ Chase Customer Insights is a complimentary business intelligence platform that offers simple, actionable analytics and reports to help you make better business decisions and reach more customers.⁷ ¹This offer is for $100 off the purchase price of a Chase Point of Sale (POS)SM Terminal. Promotion available for approved Chase Payment Solutions℠ customers only. The offer is valid through 11:59pm PT on December 31, 2024. Limit one per business relationship, regardless of the number of business locations. Not redeemable for cash (cash value = $0.00) and may not be applied to previous purchases, exchanges or returns. Employees of JPMorgan Chase Bank, N.A. and our affiliates are not eligible. Offer not valid with any other offer and subject to change without notice. Use promo code CHASEPOS at checkout on the Chase Payment Solutions Equipment website powered by Maxwell. ²Payments processed, approved, and completed by 5:00 PM Pacific Time (PT) / 8 PM Eastern Time (ET) are eligible for same-day deposits, 6 days a week, excluding Saturdays. In addition, all QuickAccept® deposits are subject to the QuickAccept Terms of Service. Payments held for risk, fraud, or other review may not be eligible for same-day deposits. Payments processed, approved and completed by 5:00 PM PT / 8:00 PM ET, Sunday through Friday (including holidays), will be deposited into the business owner's Chase business checking account that night. All payments processed, approved and completed by 5:00 PM PT / 8:00 PM ET on Saturdays will be deposited into the business owner's Chase business checking account Sunday morning by 7:30 AM ET. There is no additional cost for same-day deposits, but standard rates and fees will apply for business checking and payment processing. Customers qualify for same-day deposits upon sign-up and depositing into a Chase business checking account. Same-day deposits are available in the U.S. only. Additional exclusions may apply. ³Rate Information: Mastercard, Visa, American Express, Discover, and Chase Transactions involving physical Credit and Signature Debit cards will be assessed 2.6% discount rate and $0.10 per tap, dip or swiped transaction, and 3.5% discount rate and $0.10 per keyed transaction. PIN Debit, EBT Transactions and E-commerce transactions are excluded. Not all businesses may qualify, talk to a payment specialist for more details. ⁴Chase Point of Sale (POS)SM app and Chase Mobile® app are available for select mobile devices. Message and data rates may apply. ⁵Nilson Report, March 2023 ⁶Tap to Pay on iPhone requires the latest version of iOS. Update to the latest version by going to Settings > General > Software Update. Tap Download and Install. Some contactless cards may not be accepted. The Contactless Symbol is a trademark owned by and used with permission of EMVCo, LLC. Tap to Pay on iPhone is not available in all markets. View Tap to Pay countries and regions, Opens overlay. For more details, see https://developer.apple.com/tap-to-pay/. ⁷As a benefit of Chase Customer Insights, clients gain access to comprehensive sales, customer and peer benchmarking metrics generated from card transactions processed by Chase Payment SolutionsSM as well as purchases made on Chase-issued cards. As the No. 1 overall U.S. merchant acquirer by processing volume (Nilson Report, March 2023), and the No. 1 U.S. credit card issuer based on sales and outstandings (JPMC Annual Report), Chase Customer Insights are based on an extensive data source. "Chase," "JPMorgan," "JPMorgan Chase," the JPMorgan Chase logo and the Octagon Symbol are trademarks of JPMorgan Chase Bank, N.A. JPMorgan Chase Bank, N.A. is a wholly-owned subsidiary of JPMorgan Chase & Co. JPMorgan Chase Bank, N.A. Member FDIC

Key Features

• Accept cards in person
• Accept cards online or over the phone
• Trusted security
• Support when you need it

Cost/Fees

• 2.6% rate +10¢ per tap, dip and swiped transaction.
• 2.90% + 25¢ per ecommerce transaction.
• 3.5% rate +10¢ per keyed transaction.
• Custom pricing available.

Types of Businesses Supported

• Retail
• Restaurants
• Professional Services
• E-commerce
• Healthcare
• and more

Credit card process alternatives

If you need an easy solution to accept card payments online you can use credit card payment processing alternatives like PayPal, CashApp for Business or Venmo Business. These accounts are easy to set up but the fees will likely be more expensive than other options. 

Frequently asked questions

Is it better to use Stripe or Square?

Choose the payment processor that’s a good fit for your business. For some it will be Stripe, for others it will be Square, and others may find another payment processor. 

Who is Square’s biggest competitor?

Square’s biggest competitors on the payment processing front are Toast (a restaurant POS) and Clover. 

Can I use Stripe with Square?

There is no direct integration offered between Square and Stripe. Third party apps like AppyPie and Zapier allow you to integrate Square and Stripe’s APIs. 

Is there a monthly fee for Stripe?

There are no monthly fees for Stripe.