In the ever-evolving world of online payments, businesses in the UK are increasingly looking for efficient, reliable, and cost-effective payment processing solutions. Two major players in this arena are GoCardless vs Stripe.
This comprehensive comparison aims to explain the differences between these two platforms, helping UK businesses make informed decisions.
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GoCardless vs Stripe
| Feature / Fee Category | GoCardless | Stripe |
|---|---|---|
| Primary Focus | Direct Debit payments, especially for recurring billing | Diverse payment options including card payments, bank transfers, and mobile wallets |
| Ideal for | Subscription-based models, regular invoicing | E-commerce, platforms requiring complex payment solutions, international transactions |
| Integration | Straightforward with popular accounting software; API available | Developer-friendly API; extensive integration options with e-commerce platforms |
| Transaction Fees | 1% per transaction + 20p, capped at £4 | 1.4% + 20p for European cards, 2.9% + 20p for non-European cards |
| Subscription Billing | Supported, ideal for fixed regular payments | Supported, highly customizable |
| International Payments | Supports payments in several currencies, focus on UK and Europe | Supports over 135 currencies and various international payment methods |
| Currencies Supported | Limited range, focused on GBP and EUR | Extensive, supports multiple currencies |
| Security and Compliance | Direct Debit Guarantee, standard compliance | PCI DSS compliance, advanced security features |
| Payment Processing Time | Typically 3-5 days for Direct Debit | Varies, often quicker for card payments |
| Refunds | Supported, subject to Direct Debit rules | Supported, with options for partial and full refunds |
| Customer Support | Email, phone support, and comprehensive help center | 24/7 support through email, chat, and phone; extensive documentation |
| User Interface | User-friendly, straightforward dashboard | Highly customizable, suitable for tech-savvy users |
| Setup Costs | No setup fee | No setup fee |
| Monthly Fees | No monthly fees; charges per transaction | No monthly fees; charges per transaction, additional fees for optional services |
| Chargebacks | Low risk due to the nature of Direct Debit | Standard chargeback fees apply for card payments |
| Additional Charges | Charges for failed payments, chargebacks | Additional fees for currency conversion, advanced fraud protection, and other premium features |
This table provides a comparative snapshot of the fees and features of GoCardless vs Stripe. It’s essential for businesses to consider these details in the context of their specific payment processing needs and transaction volumes.
Overview of Gocardless vs Stripe
GoCardless
GoCardless, a UK-based company, specialises in Direct Debit payments. It’s particularly favoured by businesses for recurring billing models. GoCardless offers a straightforward platform for managing Direct Debit collections, making it easier for businesses to handle regular payments like subscriptions, invoices, and instalments.
Stripe
Stripe, on the other hand, is a global payment processing company known for its versatility in handling a wide range of payment methods, including card payments, mobile wallets, and bank transfers. Stripe’s platform is designed to cater to a variety of business models, from ecommerce stores to platforms that require complex payment solutions.
Payment processing capabilities
GoCardless
GoCardless’s strength lies in its focus on Direct Debit. Direct Debit payments through GoCardless are ideal for regular, fixed payments, reducing the risk of late or failed payments. This method is particularly beneficial for subscription-based models or regular invoicing.
Stripe
Stripe offers a more diverse range of payment processing capabilities. It can handle various types of transactions, including one-off payments, subscriptions, and even international payments in multiple currencies. Stripe’s API is highly customisable, allowing businesses to create a tailored payment experience for their customers.
Ease of integration
GoCardless
Integration with GoCardless is relatively straightforward. They provide integration options for popular accounting software and offer an API for custom integrations. This makes it easy for businesses to integrate GoCardless into their existing systems.
Stripe
Stripe is renowned for its developer-friendly tools. Its robust API and extensive documentation make it a favourite among developers for custom integrations. Stripe also offers pre-built integrations with numerous ecommerce platforms and other business tools.
Transaction fees and pricing models
GoCardless
GoCardless charges a transaction fee based on a percentage of the transaction amount plus a fixed fee.
Specifically, the fee is 1% per transaction + 20p, with a cap at £4. This pricing model is particularly transparent, as there are no hidden costs. However, additional charges may apply for failed payments and chargebacks.
This cost structure can be especially beneficial for businesses with a high volume of regular, predictable payments, as the capped fee offers cost efficiency for larger transactions.
Stripe
Stripe’s pricing is more variable, depending on the type of transaction. For card payments, Stripe charges 1.4% + 20p for European cards and 2.9% + 20p for non-European cards.
These fees are applied per transaction and can add up, particularly for businesses with a high volume of international transactions. In addition to these fees, Stripe may charge additional fees for currency conversion, advanced fraud protection, and other premium features.
While Stripe offers versatility in payment options, this can come at a higher cost for businesses processing a wide variety of payment types.
Both GoCardless and Stripe offer transparent pricing models, but the choice between them may hinge on the specific nature of a business’s transactions. GoCardless is more cost-effective for regular, larger Direct Debit payments, while Stripe’s model may be better suited for businesses requiring a broader range of payment options, including international transactions.
International payments
GoCardless
While GoCardless supports international Direct Debit payments in several currencies, its focus is predominantly on the UK and Europe. This makes it an ideal choice for businesses whose clientele is primarily in these regions.
Stripe
Stripe excels in its support for international payments. It accepts over 135 currencies and various payment methods, making it a go-to choice for businesses with a global customer base.
Security and compliance
Both GoCardless and Stripe are compliant with the necessary financial regulations and offer robust security measures. GoCardless adheres to the Direct Debit Guarantee scheme, providing added security for transactions. Stripe, being a global platform, meets various international security standards, including PCI DSS compliance.
GoCardless vs Stripe – The verdict
Choosing between Stripe vs GoCardless depends largely on the specific needs of a business.
GoCardless is ideal for UK businesses focused on regular, fixed payments through Direct Debit, offering simplicity and efficiency in this domain.
Stripe, with its versatile payment options and global reach, is better suited for businesses that require a broader range of payment solutions, particularly those operating on an international scale.
In conclusion, both platforms offer strong capabilities in their respective areas. The decision should be based on the unique payment processing requirements of your business, considering factors such as transaction types, customer base, and integration needs.
FAQ for Stripe vs GoCardless
GoCardless is often preferred by small businesses for regular, fixed payments, especially Direct Debit, whereas Stripe offers a broader range of payment options, making it suitable for businesses that need more versatility.
GoCardless supports international payments in several currencies but is primarily focused on the UK and Europe, while Stripe excels with its support for over 135 currencies and various international payment methods.
Yes, both GoCardless and Stripe offer subscription billing options. GoCardless is ideal for fixed regular payments, while Stripe provides more customisable options for various billing models.
GoCardless charges a transaction fee of 1% + 20p, capped at £4, which is cost-effective for Direct Debit payments. Stripe’s fees are 1.4% + 20p for European cards and 2.9% + 20p for non-European cards, which may add up, especially for international transactions.
GoCardless offers a user-friendly and straightforward dashboard, making it accessible for non-technical users. Stripe, while user-friendly, is highly customisable and may require a bit more technical expertise to fully leverage its features.
Both GoCardless and Stripe provide robust customer support. GoCardless offers email and phone support along with a comprehensive help centre, while Stripe provides 24/7 support through email, chat, and phone, along with extensive documentation.
Both GoCardless and Stripe are secure and comply with necessary financial regulations. GoCardless adheres to the Direct Debit Guarantee scheme, while Stripe meets various international security standards, including PCI DSS compliance.
GoCardless is primarily designed for recurring payments through Direct Debit, while Stripe is more versatile in handling both recurring and one-off payments, including card payments and bank transfers.
GoCardless can be more cost-effective for businesses with a high volume of regular, larger Direct Debit payments due to its capped transaction fees. Stripe’s fees per transaction could add up, especially with a high volume of diverse payment types.
Both GoCardless and Stripe do not charge any setup fees, making them accessible for businesses of all sizes.
Stripe offers a wide range of payment options including mobile payments, whereas GoCardless is more focused on Direct Debit and does not specifically cater to mobile payments.
Payment processing time with GoCardless typically takes 3-5 days for Direct Debit, whereas Stripe’s processing time can vary, often being quicker for card payments.
Both GoCardless and Stripe support refunds, but the process may be quicker and more flexible with Stripe, which offers options for partial and full refunds.
Stripe is known for its extensive integration options with various e-commerce platforms, while GoCardless offers integration mainly through its API and some popular accounting software.
GoCardless has a low risk of chargebacks due to the nature of Direct Debit, whereas Stripe applies standard chargeback fees for card payments.
Both GoCardless and Stripe can be suitable for non-profit organisations, but GoCardless may be more advantageous for regular, fixed donations, while Stripe offers more flexibility in payment methods.
Yes, both GoCardless and Stripe offer solutions for businesses to accept invoice payments, though GoCardless is more focused on regular invoice payments through Direct Debit.
Yes, both GoCardless and Stripe are suitable for freelancers and independent contractors, with GoCardless being ideal for regular client payments and Stripe offering more diverse payment options.
Stripe offers comprehensive data analytics and reporting tools, whereas GoCardless provides basic reporting features, suitable for tracking Direct Debit transactions.
Stripe handles currency conversions for its extensive range of supported currencies, often including additional fees. GoCardless also supports several currencies for international payments but is more focused on the UK and European market.