Stripe vs PayPal: PHP Guide

Integrating payments is crucial for any e-commerce application, subscription service, or online marketplace. At ZIRA Software, we've integrated both Stripe and PayPal into dozens of applications. Clients frequently ask: which payment gateway should I choose?

The answer depends on your specific needs, target audience, and technical requirements. Let's dive deep into both options.

Overview

Stripe is the modern developer-friendly payment processor that launched in 2011. It focuses on making payment integration simple through clean APIs and excellent documentation.

PayPal has been processing online payments since 1998 and is recognized worldwide. Most internet users already have PayPal accounts, which can increase conversion rates.

Fee Structure

Stripe

• Standard rate: 2.9% + $0.30 per successful transaction
• International cards: +1% additional
• Currency conversion: +1% additional
• No setup fees, no monthly fees, no hidden fees

PayPal

• PayPal Standard: 2.9% + $0.30 per transaction
• PayPal Pro: 2.9% + $0.30 + $30/month
• International fees: 3.9% + fixed fee
• Cross-border fees: Additional 1.5%
• Currency conversion: 2.5% above market rate

Winner: Stripe for transparent pricing, PayPal for domestic-only transactions.

Developer Experience

Stripe Integration

Stripe's API is RESTful, well-documented, and developer-friendly:

<?php

require_once('vendor/autoload.php');

\Stripe\Stripe::setApiKey('sk_test_...');

// Create a charge
try {
    $charge = \Stripe\Charge::create([
        'amount' => 2000,  // Amount in cents ($20.00)
        'currency' => 'usd',
        'source' => $_POST['stripeToken'],
        'description' => 'Order #12345'
    ]);

    // Charge succeeded
    echo "Payment successful! Charge ID: " . $charge->id;

} catch(\Stripe\Error\Card $e) {
    // Card declined
    $error = $e->getMessage();
    echo "Error: " . $error;
}

Frontend (Stripe Checkout):

<form action="/charge.php" method="POST">
    <script
        src="https://checkout.stripe.com/checkout.js"
        class="stripe-button"
        data-key="pk_test_..."
        data-amount="2000"
        data-name="Your Company"
        data-description="2 widgets ($20.00)"
        data-image="/img/logo.png">
    </script>
</form>

PayPal Integration

PayPal offers multiple integration methods. The modern REST API:

<?php

require __DIR__ . '/vendor/autoload.php';

use PayPal\Rest\ApiContext;
use PayPal\Auth\OAuthTokenCredential;
use PayPal\Api\Payment;
use PayPal\Api\PaymentExecution;

$apiContext = new ApiContext(
    new OAuthTokenCredential(
        'CLIENT_ID',
        'CLIENT_SECRET'
    )
);

// Create payment
$payer = new \PayPal\Api\Payer();
$payer->setPaymentMethod('paypal');

$amount = new \PayPal\Api\Amount();
$amount->setTotal('20.00');
$amount->setCurrency('USD');

$transaction = new \PayPal\Api\Transaction();
$transaction->setAmount($amount);

$redirectUrls = new \PayPal\Api\RedirectUrls();
$redirectUrls->setReturnUrl('http://yoursite.com/return.php')
             ->setCancelUrl('http://yoursite.com/cancel.php');

$payment = new \PayPal\Api\Payment();
$payment->setIntent('sale')
        ->setPayer($payer)
        ->setTransactions([$transaction])
        ->setRedirectUrls($redirectUrls);

try {
    $payment->create($apiContext);
    // Redirect to approval URL
    header('Location: ' . $payment->getApprovalLink());
} catch (Exception $ex) {
    echo "Error: " . $ex->getMessage();
}

Winner: Stripe for cleaner API and better documentation.

User Experience

Stripe Checkout

Pros:

• Beautiful, responsive modal
• Stays on your website
• Remembers card details (with permission)
• Mobile-optimized
• Accepts Apple Pay/Google Pay

Cons:

• Requires users to enter card details
• Some users hesitant to enter cards on unfamiliar sites

PayPal Checkout

Pros:

• Users redirected to PayPal
• Many users already have accounts (faster checkout)
• High trust factor
• Guest checkout available

Cons:

• Redirects away from your site
• Longer checkout flow
• Can feel disconnected from your brand
• Some users don't have PayPal accounts

Winner: PayPal for user recognition, Stripe for seamless UX.

Subscription Billing

Stripe Subscriptions

<?php

// Create a customer
$customer = \Stripe\Customer::create([
    'email' => 'customer@example.com',
    'source' => $_POST['stripeToken']
]);

// Create a subscription
$subscription = \Stripe\Subscription::create([
    'customer' => $customer->id,
    'items' => [['plan' => 'plan_id']],
]);

// Handle webhooks for failed payments, cancellations, etc.

Stripe excels at recurring billing with:

• Flexible plan creation
• Metered billing
• Trial periods
• Proration
• Detailed analytics
• Dunning management

PayPal Subscriptions

PayPal supports recurring payments but with less flexibility:

// PayPal billing agreements/subscriptions require more setup
// Uses Billing Plans API

Winner: Stripe for SaaS and subscription businesses.

International Support

Stripe

• Supports 135+ currencies
• Available in 46 countries (expanding)
• Local payment methods (SEPA, Alipay, etc.)
• Automatic currency conversion
• Multi-currency support

PayPal

• Supports 25+ currencies
• Available in 200+ countries
• Widely recognized internationally
• Local PayPal accounts worldwide

Winner: PayPal for global reach, Stripe for currency flexibility.

Security and PCI Compliance

Both Stripe and PayPal handle PCI compliance, so you don't have to:

Stripe:

• Card details never touch your server
• Tokenization with Stripe.js
• Level 1 PCI compliant
• Built-in fraud detection (Radar)

PayPal:

• Payments processed on PayPal's servers
• Level 1 PCI compliant
• Fraud protection included

Winner: Tie—both are secure and PCI compliant.

Features Comparison

| Feature | Stripe | PayPal | |---------|--------|--------| | Transaction Fee | 2.9% + $0.30 | 2.9% + $0.30 | | Monthly Fee | $0 | $0 (Standard) / $30 (Pro) | | Setup Fee | $0 | $0 | | International | +1% | +1.5% | | Payout Time | 2 days | Instant (with fee) | | Dashboard | Excellent | Good | | API Quality | Excellent | Good | | Documentation | Excellent | Good | | Subscription | Native | Available | | Webhooks | Excellent | Good | | Testing | Easy | Complex | | Mobile SDKs | iOS, Android | iOS, Android |

Our Recommendations

Choose Stripe When:

1. Building a SaaS application - Superior subscription management
2. Modern user experience matters - Seamless on-site checkout
3. Developer experience is priority - Cleaner API, better docs
4. Targeting tech-savvy users - They're comfortable entering cards
5. Need advanced features - Marketplace, Connect, Sigma analytics
6. International customers - Better currency handling

Example: Subscription SaaS

// Stripe makes this straightforward
$subscription = \Stripe\Subscription::create([
    'customer' => $customer_id,
    'items' => [
        ['plan' => 'basic_monthly'],
    ],
    'trial_period_days' => 14,
]);

Choose PayPal When:

1. Targeting general consumers - High recognition and trust
2. International business - Available in more countries
3. Customers prefer PayPal - Many users have accounts
4. eBay integration - Owned by eBay, natural integration
5. Micropayments - PayPal Micropayments has lower fees for small transactions
6. Chargebacks are a concern - Strong seller protection

Use Both?

Many successful e-commerce sites offer both options:

<div class="payment-options">
    <button id="stripe-button">Pay with Card</button>
    <button id="paypal-button">Pay with PayPal</button>
</div>

This maximizes conversion by letting customers choose their preferred method. At ZIRA Software, we typically implement both for e-commerce projects.

Real-World Implementation Tips

Stripe Best Practices

1. Always use webhooks for payment confirmations
2. Implement idempotency keys to prevent duplicate charges
3. Use metadata to store order IDs and customer info
4. Enable Radar for fraud detection
5. Test thoroughly with Stripe's test cards

PayPal Best Practices

1. Use IPN (Instant Payment Notification) for payment verification
2. Verify IPN messages to prevent fraud
3. Handle all payment states (pending, completed, refunded)
4. Store PayPal transaction IDs for reference
5. Test in sandbox thoroughly

Performance Comparison

In our benchmarks at ZIRA Software:

Stripe:

• API response time: 200-300ms
• Checkout loading: < 1s
• Payment processing: 2-3s

PayPal:

• API response time: 300-500ms
• Redirect overhead: 1-2s
• Payment processing: 3-5s

Winner: Stripe for performance.

Conclusion

There's no universal winner—the right choice depends on your specific needs:

Stripe wins for:

• Developer experience
• Subscription businesses
• Modern, seamless UX
• Advanced features

PayPal wins for:

• User recognition
• International availability
• Consumer trust
• Existing PayPal users

For maximum conversion, consider offering both.

At ZIRA Software, we've built e-commerce platforms processing millions in transactions using both gateways. We can help you choose and implement the right payment solution for your business.

Ready to integrate payments into your application? Contact ZIRA Software for expert payment gateway integration and e-commerce development.