The best alternatives to PayPal a glance

Imagine your day-to-day life without online shopping. For many people, removing this modern convenience would be tantamount to shortening the opening hours of brick-and-mortar retail locations. In other words, it would present a major setback for their quality of life. It doesn’t matter whether it’s clothing, electronics, or food — online shopping gives users the possibility to comfortably shop at home and order goods with one click.

When it comes to online shopping, the advantages for the consumer are clear: goods are ordered from home and promptly delivered to your doorstep (most of the time shipping is free). If the product isn’t right for you, you can simply send it back on its way to the retailer. Again, these shipping costs are also gratis. And while there are many online payment methods available, one of the most popular options for online shoppers is PayPal. The online payment service is both simple and secure; however, the Bay Area multinational has been the target of much criticism due in part to its questionable practice of freezing accounts as well as its tendency to at times underperform in security matters. But what PayPal alternatives are there? We take a look at some of the most well-known and best PayPal alternatives on the market.

Amazon Pay

Amazon Pay is the online retail giants very own payment service. Amazon Payments profits immensely from its parent company’s notoriety and reputation, which is why many other popular online shops opt for this payment option.

Amazon Pay allows users to process purchases in participating shops with their Amazon account, which only requires an e-mail address and a password to complete a purchase. Here, the provider uses the payment information that’s already been registered with Amazon. All that’s needed is an active Amazon account. The advantage here is that there’s no need to handover sensitive payment information to third parties. Amazon acts as the intermediary between customer and retailer. The customer shouldn’t expect any additional costs for setting up and using the account. The retailer, on the other hand, should expect to pay 1.9 % of the total purchase price plus an additional 35 cents for each transaction: the same fees as PayPal. Billing is carried out via credit card.

Advantages Disadvantage
No separate account required Can only be used together with an Amazon account
No billing until goods are sent Consumer protection concerns: Amazon has information on the customer’s payment behavior and consumer history

Apple Pay

Apple’s alternative to PayPal is a mobile payment service. Apple Pay is only available for a limited target group that has access to newer Apple products. The payment service acts first and foremost as an NFC-based wallet for the iPhone, allowing Apple Pay to carry out so-called contactless payments at the checkout register.

Recently, some online stores have started to support this method of payment. Apple Pay was only available in the United States for a long time; however, it has since expanded its services to France, the United Kingdom, and Switzerland. Due to its immense market power, it’s highly likely that this PayPal alternative will also spread to other countries in coming years.

Advantages Disadvantages
Online payment as well as on-site contactless payment possible Exclusively available to Apple users
No storage of payment data on the devices Not widely available outside of the United States
High security standards  

Android Pay

When it comes to mobile payments, it’s essential not to forget the second most important player. With Android Pay, Google brought its own payment service to the market. As the successor of Google Wallet, Android Pay is the internet giant’s second attempt to get a foothold in the payment services industry. Android Pay is used for in-app payments as well as for transactions at brick-and-mortar retailers. Third-party providers are also able to integrate the function into their online shops. Payment takes place via an app with one click. The idea is similar to that of Apple Pay: credit card information is stored and securely managed and no payment information is sent to the merchant. Using Android Pay is free, however, customers outside of the United States will have to wait, as it has yet to expand beyond American borders.

Advantage Disadvantage
High security standards Exclusively available to the US market at the moment
Can be used independently of Google as a separate App  


This next option takes a look at PayPal alternatives from the merchant’s perspective. Founded in 2005 by Israeli entrepreneur, Yuval Tal, this money transfer and payment company is especially well suited to small and medium sized business as well as freelancers. As a registered Member Service Provider (MSP) of Mastercard, Payoneer is available in over 200 countries. Users can opt to either have funds transferred to a bank account or into a reloadable prepaid debit card, which can then be used to carry out transactions. Low currency conversion fees also make this an attractive option for cross-border wire transfers, which is why it’s a very popular solution for Airbnb hots as well as freelancers with international clients.

Advantages Disadvantages
Available worldwide Somewhat high credit card rates
Low currency conversion rates  
Small business/freelancer friendly  


The UK-based payment system Skrill, formerly known as Moneybookers, works on a prepaid basis. Via credit or debit card, users pay into a customer account. The prepaid credit can then be used for later purchases or online orders. Paying via the customer account doesn’t require any bank or credit card information to be transferred to the merchants. The prepaid idea is also valuable for allowing users to set budgets for themselves. But this model is also associated with its own unique risks: Customers have to pay before they’re able to use the service, meaning their accrued credit could be lost (e.g. in instances of bankruptcy).

Advantages Disadvantages
No transfer of sensitive data No cancellation possible
Complete cost control Still not wide spread in terms of use
  Higher security standards only with verified accounts
  Charges for additonal services
  Potentially prone to phishing attacks
  Prepaid model risks

Prepaid model risks

As seen above, there are many alternatives to the online payment service, PayPal. The popularity of the service is often deciding for many customers (i.e. how many shops does this payment service offer?). In this regard, there’s simply no beating PayPal; however, other providers are stronger with regards to features such as flexibility and data protection.

Provider Fees Payment form Advantages Disadvantages
Amazon Pay For merchants 1.9 percent plus and additional 35 cent per transaction Credit card No need to register additional account with merchant, no transfer or payment information to third parties Can only be used with an Amazon account, questionable data protection practices
Apple Pay Fees for users not known, for credit card companies: 0,15% per transaction Credit card Security, useful for different applications Exclusively available for apple product
Android pay None Credit card No account necessary, no transfer or sensitive data Ib.
Payoneer 1% for each payment received Credit card (specifically Mastercard) Available in over 200 countries; small business-friendly Somewhat high credit card rates
Skrill None Credit card/debit card Manageable budgeting due to prepaid system, no transfer of bank data to merchants Not as widespread, no cancellations possible, additional services and high security standards are fee based