Jul 152013

Alternatives to Paypal LogoThere are lots of reasons that people may want alternatives to Paypal. The most common are limits on new accounts, and freezes on accounts that they deem “high risk.” Customer service is often and issue as well. With a world wide user base of 110 million people it seems their staff may be spread a little too thin these days.

If you’ve been on the receiving end of one of their 21 day holds, or even an outright account cancellation, you might wondering who Paypal’s competitors are. And considering how completely integrated they are with the internet, if there are there any real Paypal alternative that can be used on the big selling sites?

With the rising number of people who want a an alternative demand has now given rise to some real competition. Here is a list of the best that are currently available. We’ll start with two that can be used on eBay since that’s one of the most common problems people have.

Top Alternatives to Paypal

Skrill (formerly known as Moneybookers) is one of 2 alternatives for Paypal with integration into eBay’s checkout system. They are a truly international payment system with over 10 million users in 200 countries and 40+ currencies. In terms of sheer size it is #2 to Paypal. You can upload money from your back account, debit card, or credit card. You can send it to anyone anywhere in the world who has an email address. And you can use their debit card to access your funds anywhere, anytime at an ATM. You can also make deposits to your bank. Their merchant fees are very similar to Paypal but they are somewhat complicated by the fact that there are many different rates charged depending on your location and the destination of the transfer.

There aren’t many drawbacks to their system other than the fees. One thing, although they can be set up for online merchants, not many are their checkout service as of yet.

ProPay is the other alternative for accepting payments on eBay. They are also integrated into eBay’s checkout system and their transaction fees are similar to Paypal. Propay also has other very similar services including  checkout systems for your website. Another thing to point out  is their recurring billing and subscription capability. Not many other services offer that so if you’re in the market for a different subscription billing service, ProPay may be your answer.

One drawback is the annual account fee. They charge $49.95 per year!

Google Wallet is a mobile payment system by Google that is giving Paypal a run for the money. It has a fairly large adoption rate both online and in physical stores. If you’re a buyer all you have to do is sign up and you can purchase at any online retailer that offers it as a payment option. If you have a smart phone capable of running their app, all you have to do is tap your device on the store’s NFC reader. It also keeps track of all your debit cards, credit cards, and gift cards in one convenient location.

The downside is that it is strictly a buyer/seller transaction service. You cannot send money directly to other Google Wallet users.

Amazon WebPay is a Paypal alternative that doesn’t charge any fees! And it works just like Paypal. You can use your email address to send and receive money or pay by text on your mobile phone. It can be used with any online retailer set up to receive Amazon payments. You can use both your credit cards or bank account as a funding source. It seems like they just want to steal all of Paypal’s customers by offering all the same services for free.

The only drawback is you can only withdraw amounts higher than $10.

Dwolla operates more like an extension of your regular bank account.  As a different approach, they charge their fees to the person receiving the money, not the sender. The fee is a flat $.25 transaction fee for anything over $10. If it’s under $10 then its free. It has the standard array of mobile applications and can be used in stores that accept it. It can also be used via email, phone number, and some social networks. As a real innovation in the internet age, they have their support number on the front page of their website!

The catch here is that both the buyer and the seller must have a Dwolla account which can be a bit inconvenient. Its payment system is also a bit slower but they offer an upgrade to “Instant Transaction” for $3.00 a month.

Payza is a good service to look into if you need to do a lot of international transactions. They do business in 190 countries and 21 different currencies. They have all of the features that Paypal offers including person to person transfers and online payments. You can also withdraw funds from your account to your bank and they offer a physical debit card. The option to send an invoice to a customer is also available. Plus they’ve made it a point to have a lot of security features which is nice. However, they do also charge fees like Paypal although slightly less.

Payza doesn’t have the ability to accept credit cards directly though. Your buyer will have to create their own account to send you money.

Payoneer is a completely different kind of Paypal Alternative. You can create an account for free after which they will give you a virtual Mastercard or send you a physical prepaid Mastercard. Once activated, you can put money on it from a credit card or bank account to make a payment. Or you can receive payments from others to your card account. They are also a good international solution with the ability to do transactions in 210 countries.

However the card is charged a loading fee from 1% to 3.75% depending on the source of the funds and the money can take anywhere from 2-7 days to be applied to the account.

Square allows you to accept credit cards with your mobile phone. It comes with a small card swiping device that plugs into your headphone jack. You can then physically accept anyone’s credit card just like a retail store with a credit card machine. However, you don’t have to have a buyer’s actual card to run a transaction. You can also enter the cc number into the app manually. Square charges a standard 2.75% fee for all swiped transactions and 3.5% + 15¢ per manually entered transaction keeping their fee structure very simple.

Sorry, no international merchants. Their service is only available in the United States. It also does not work on Windows Phones or Blackberries.

WePay is a good alternative to ecommerce websites and mail order companies looking for a payment processor. They offer website integration with on-site payment acceptance. There’s no need for your customer to be transferred to the payment processor’s website to enter their details making your site appear more professional. They even offer a website builder! Wepay also offers a virtual terminal allowing you to process payments from anywhere using your cell phone. Fees are 2.9% + $0.30 for credit cards and 1.0% + $0.30 for bank payments.

One downfall: they can only be use in the US.

So as you can see there are plenty of alternatives to Paypal no matter what your needs are. Many of them are even better when it comes to certain niches. Some of them are cheaper. So now you know that you can definitely find a good a substitute. If you’d like to compare rates with any of the services we’ve listed above, please feel free to use our Paypal fee calculator.

  2 Responses to “Paypal Alternatives | Who are Their Top Competitors?”

  1. Another Paypal alternative for international business is Paysera. Similarly as with Paypal or Payza there are multiple features available – merchant’s account, payment processing, international transfers for personal use and mobile payments. Credit card services are available only for EU based merchants. However, transactions using Paysera app are processed globally.

  2. I would add Bitcoin payment processors like http://www.gocoin.com to the list. Accepting payments in bitcoin is a very smart and safe option to use — there are no chargebacks, and the money gets converted into USD or whatever currency.

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