The Stripe vs Square debate has become an important one. Stripe and Square are two of the most important payment processing tools for businesses, small and large. They help millions of people perform transactions.
It is almost impossible to think today of an online store that offers online payments without using Stripe. Similarly, more brick-and-mortar stores are using Square. Although both offer somewhat similar services, they differ in important ways. If you are considering using one of these two payment processing services for your company, understanding them is crucial.
In this post, we briefly explain the role of payment processors, what Square and Stripe do, and how to choose the alternative that best fits your company’s needs based on their similarities and differences.
Online Payments Using Stripe
It sounds like something trivial, but online payments have revolutionized the business world; the retail industry, and eCommerce in particular, have seen tremendous growth. We often tend to forget that, in order for this industry disruptive technology to work properly, many different components need to be integrated and operating at an optimal level.
Stripe is an online payment platform that processes a transaction’s data so that the necessary financial operations can easily be executed. It is mostly used by companies that use the Internet as the point of sale.
From a consumer’s perspective, an online payment requires, depending on the payment platform being used, a series of steps. These steps usually involve typing the debit or credit card payment details and confirming certain details to validate the transaction. However, much more than this occurs at the moment of an online transaction. Behind the user-facing components of a transaction, payment gateways make sure that banks and other financial institutions perform operations correctly.
Like with many other technologies, a lot can go wrong throughout this process. That is why using the correct payment processing tool is essential to guarantee a successful business operation. An online store that uses poorly built payment processing software risks losing customers and damaging its reputation.
It comes as no surprise then that choosing the right payment processing tool is critical for any online store, especially if you are considering eCommerce integrations for your business.
Brick and Mortar Payments Using Square
Unlike Stripe, which mostly serves as a tool for any online store, Square targets a different audience. Thanks to its now-famous square-shaped hardware, which can be used by stores to process customers’ debit or credit cards, physical stores can easily sell their products or services directly over an Internet connection.
Square’s gadget allows anyone with a connection to the Internet to process payments using a mobile device. This way, access to financial services is increased through this payment platform. However, Square’s benefits do not end there. With time, it has also added other features for specific businesses, including inventory management, invoice generation, and even loan solutions.
The Square technology offers APIs for developers so that integrations can easily be built through mobile app development. This has an important impact on your business as it allows you to customize the platform according to your specific needs.
Payment Processing Services
Square and Stripe are two of the most popular payment processors. However, few people really know what they do. There’s really no need to worry about how payment processing works. Just keep in mind that these tools make it possible for anyone to perform online payments easily with the use of a debit or credit card.
In other words, these tools help your business accept transactions through a web-connected point of sale. For any physical or online store, having an Internet-based point of sale solution is necessary. Otherwise, it would be impossible to process payments. However, keep in mind that an online store operates differently from a brick-and-mortar one.
It is in this context that one can find the main similarities and differences between Stripe and Square.
Similarities Between Stripe and Square
The most important similarity in the Stripe vs Square comparison is the fact that they are both payment processors. Both are great at credit card processing, and they can guarantee your business secure and reliable transactions. They do not charge monthly service fees and instead only make money for every transaction made.
Additionally, they both offer easy-to-use payment platform alternatives when compared to traditional solutions offered by large financial institutions. For any business, this is ideal as it facilitates the process of finding a payment platform that works without having to go through tedious and never-ending bureaucratic processes.
In terms of the availability of money coming from transactions, both tools help businesses access resources in a timely manner. This isn’t always the case with traditional payment processing tools. When it comes to customer support, both Stripe and Square also offer good service.
Differences Between Stripe and Square
The most important and obvious difference is the audiences they serve. Stripe tends to focus on businesses with a stronger online presence, while Square is more oriented towards brick-and-mortar businesses. Stripe is thought out for situations where the customer is not directly in the place of the transaction.
The Stripe vs Square pricing difference is also worth mentioning. Each takes a percentage of the sales plus an additional value per transaction. For the case of Stripe, these are $2.9% and $0.30, respectively, and for Square, these values are 2.6% and $0.10.
Final Thoughts: Stripe Vs Square Pros and Cons
Stripe and Square have become important players in the online payments ecosystem because of the easy-to-use and secure payment processing solutions they offer to your business as a point of sale. When it comes to the Stripe vs Square features debate, both offer great credit card processing solutions for any type of business.
When analyzing the pros and cons of each alternative, as an app development company, we’ve often found that there is not a right choice between them. Ultimately, it all comes down to what you need, and depending on that, you can weigh which one best fits your business’ needs.