Paypal Website Payments Pro Vs – A Review Of Two Credit Card Processing Solutions

As part of my free mini course on how to start an online store, I recommend 2 different credit processing services, Paypal Website Payments Pro and which is an provider.

But the problem with recommending more than one option is that you still have to make a choice. And making the right decision largely depends on the nature of your business and the volume of payments that your shop processes.

The reason I decided to recommend more than one option is because both services have their pros and cons which I’m going to talk about in this article today. I’ve used both credit card processing solutions before so I’ll give you my breakdown and let you make the call.

Which One Is Cheaper?

The first and foremost criteria that most people use to select a credit card processor is price. But when it comes to credit card processing, the different fees are not always straightforward to calculate.

For example, some credit card processors charge you a registration fee, a monthly gateway fee, a statement fee as well as a percentage of your sales.

Some merchants allow you to apply your monthly gateway fee towards your discount rate fees. Some merchants provide a tiered discount rate depending on how much you sell.

There are many different ways to get charged depending on your sales volume and all of the numbers can get confusing depending on the scenario.

The reason I like eMerchant is because they are drastically cheaper, they offer transparent pricing and transaction fees that get cheaper as your business grows.

For example, there are no complicated rules on how you get charged.

You basically pay a flat percentage above the interchange rate which is the “wholesale rate” for credit card processing. Right now, I’m paying under 2.2%.

After researching many different credit card merchant account and gateways, the rates for eMerchant are very reasonable, the service is very dependable and they provide good support as well. Now let’s take a look at Paypal Website Payments Pro.

The fees for Paypal Website Payments Pro are fairly straightforward as well but the rates are more expensive and tiered depending on your sales volume.

  • There’s a $30 monthly fee
  • For a monthly sales volume of $0.00 USD – $3,000.00 USD, you get charged 2.9% + $0.30 USD
  • For a monthly sales volume of $3,000.01 USD – $10,000.00 USD, you get charged 2.5% + $0.30 USD
  • For a monthly sales volume >$10,000.01 USD, you get charged 2.2% + $0.30 USD

Update: Paypal removed all quantity discounts on credit card processing now so everyone pays 2.9%!

Overall, eMerchant is always going to be cheaper than Paypal Website Payments Pro.

Which One Is More Convenient?

Money is important but it’s not everything. When you sign up for eMerchant, you are more or less signing up for a vanilla merchant account and gateway.

In other words, you’ll be able to process credit cards but that’s about it. What’s nice about Paypal is that they offer additional features that are very convenient.

For example, your online store is probably going to accept regular Paypal in addition to credit cards. Paypal Website Payments Pro allows you to accept both Paypal standard payments and credit cards all through the same account.

This is really nice simply because you’ll have one less account to deal with. In other words, that’s one less account where you’ll have to transfer money out of and into your business checking every single month.

The other really nice thing about Paypal is that they offer an extremely convenient and easy to use one click shipping platform. Whenever someone makes a purchase from your shop, the address information can be sent directly to Paypal.

Then, using their multi-order shipping interface, you can quickly and easily ship all of your packages and print shipping labels from Paypal’s website. The best part is that all of the shipping fees are automatically deducted from your Paypal account.

If you run a small online store, that you means you don’t have to sign up for a 3rd party shipping platform like You don’t have to deal with downloading and uploading customer addresses to a separate shipping service. You can do everything without leaving Paypal’s website!

The Intangibles

Sounds pretty good right? But the one caveat with Paypal is that Paypal is not a true bank. With and your own merchant account and gateway, any money that you receive is automatically yours once it reaches your bank account and no one can easily take it away from you.

With Paypal however, they get to call the shots with your money and can place holds on your account whenever they feel like it. For example, let’s say that Paypal detects some abnormal charging patterns with your account.

Without any warning, they can freeze your assets and prevent you from accessing your funds. A full on fraud investigation can last for several months and during this period you will not be able to withdraw your money from your account.

While this has never happened to me (knock on wood), there are many websites out there such as that are filled with stories and complaints from Paypal users who have had their money frozen for long periods of time.

Which Should I Choose?

If you don’t care about the integrated shipping that Paypal offers and you don’t mind having yet another bank account, going with eMerchant is a no brainer.

However, if you hate maintaining a bunch of different accounts and want a nice, integrated way of shipping your orders, you should consider signing up for Paypal Website Payments Pro.

While it starts out more expensive, once you reach a monthly sales volume of greater than $10000, the difference in discount rate is not that big of a deal.

The other major thing you have to consider is whether you are comfortable with Paypal having full control over your funds. If you are even remotely worried about having your assets frozen, then avoid Paypal altogether.

Once again, this has never happened to me before but just be aware that it’s a possibility. Good luck with your decision!

Ready To Get Serious About Starting An Online Business?

If you are really considering starting your own online business, then you have to check out my free mini course on How To Create A Niche Online Store In 5 Easy Steps.

In this 6 day mini course, I reveal the steps that my wife and I took to earn 100 thousand dollars in the span of just a year. Best of all, it's free and you'll receive weekly ecommerce tips and strategies!

Note: This post above may contain affiliate links, which means that I may receive a commission if you make a purchase when clicking a link. Please consult our privacy policy for more information.

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About Steve Chou

Steve Chou is a highly recognized influencer in the ecommerce space and has taught thousands of students how to effectively sell physical products online over at

His blog,, has been featured in Forbes, Inc, The New York Times,  Entrepreneur and MSNBC.  

He's also a contributing author for BigCommerce, Klaviyo, ManyChat, Printful, Privy, CXL, Ecommerce Fuel, GlockApps, Privy, Social Media Examiner, Web Designer Depot, Sumo and other leading business publications.

In addition, he runs a popular ecommerce podcast, My Wife Quit Her Job, which is a top 25 marketing show on all of Apple Podcasts

To stay up to date with all of the latest ecommerce trends, Steve runs a 7 figure ecommerce store,, with his wife and puts on an annual ecommerce conference called The Sellers Summit.  

Steve carries both a bachelors and a masters degree in electrical engineering from Stanford University. Despite majoring in electrical engineering, he spent a good portion of his graduate education studying entrepreneurship and the mechanics of running small businesses. 

32 thoughts on “Paypal Website Payments Pro Vs – A Review Of Two Credit Card Processing Solutions”

  1. Vincent D says:


    Nice write up! But I gotta warn you very hard about Paypal. Never keep so much money in your Paypal account. They can freeze your account and hold your money for 180 days. When you asked why, they will come up with BS such as “We determine that having a business relationship with you was risky”, or “Your sale patterns indicate that you have unusual business activities”, or “We suspect that your account is linked to another account, we will need to verify before we can release your fund”. They have total control over your money. It’s more like a pleasure for you to do business with them and you are at their mercy, but they don’t give a rat ass about you and your business.

    I have been with Paypal about 3-4 years now and never thought anything would happen to me if I just follow their rules. However, I was wrong!

    1. Steve says:

      Hey Vincent,
      Out of all of the bloggers and marketers I know, only one has ever had problems with Paypal. Paypal decided to place an arbitrary limit of 10000 per day on his account so when he hit this limit one day, everything was frozen and he couldn’t accept more payments. After this happened, I immediately called Paypal to make sure that there was no limit imposed on my account. These arbitrary are not documented anywhere. Outside of that though, I’ve been happy with them.

      1. Gary says:


        It happened to me too.

        My account was frozen several years ago with no appeal. Luckily I had withdrawn all of the funds before that. They said I violated their TOS. It’s still frozen. I can’t make sales or purchases. And of course I can’t open another account. I am not even sure what i did, and they aren’t being specific.


  2. Mark says:

    Thanks for the article Steve! I’m currently in the process of getting a merchant account with and I’ll be running my website/checkout through Volusion. I was glad to see your article about this and it helped to reassure me that I was making the right decision. Volusion has a fully integrated checkout through and I thought you might be interested to hear what my monthly fees will be. These are the exact numbers in my contract: 17.99/month – Gateway Access Fee, $10.00/month – Monthly Statement Fee, $3.41/month – Monthly PCI Compliance Fee. So my total monthly fee is $31.40. I will also be charged 2.15% + $0.34 for each credit card transaction. I also pay $19.00/month for my Volusion website.

    1. Steve says:

      Hey Mark
      Awesome! Once you have your website up in addition to all of the sales you’ve been getting from FB, you’ll be raking it in soon enough. It’s probably too late, but the provider I mentioned in the post sounds about half as expensive as your merchant and PCI scans are free as well. May want to check them out.

  3. Art says:

    Very useful comparison of Paypal website payments pro and To this point, I’ve only used Paypal and don’t really have problems because I don’t really make any money. I don’t like the thought of having money I’ve earned being withheld by Paypal for no good reason. I didn’t know that was a direct link to the bank account! This useful for me to know because I plan to do drop-shipping so I won’t need shipping services Paypal provides. Plus, with your discount link, that’s a pretty sweet deal my friend! Thanks

    1. Steve says:

      Thanks. I’ve never had any problems with PP before, but it’s just something to be aware of. Good luck!

  4. Charlene Proctor says:

    Really glad I ran across this article. I am just about to launch my 1st product and have decided to use paypal. I did not realize that paypal has so much control over funds. Guess I will have to cross fingers and trust it will all run smooth. Thanks again for the well written article.

    1. Steve says:

      Glad to be of help. You should be fine with PP

  5. Ivan Walsh says:

    If you do get a business account with Paypal, make sure to get it verified.

  6. Ellie says:

    Hi Steve,
    excellent information about these 2 merchant accounts.
    Currently we are trying to figure out how to find a better system for our online cart. We use mals cart and then process cards over the phone (not ideal, but it has been working good for our small business)… most of our business is via farmer’s markets, online, referrals and over the phone.
    We have also started looking at using Square with the ipad. In order to start using something like (which would be more appealing due to it being a cheaper option over payapl)… do you think it would be worth it to change to use
    I guess our questions are: 1) what would the first change we should make be… to change the cart we use? (we like and are used to mals cart, but we have only used the free version and it doesn’t have any extra features. (also, we are a small business and every extra expense takes a big cut out of the budget -additionally, any change we make takes time and energy to figure out and to fix any thing that goes wrong).
    2) should we first change to using something like which would be great to automate payments without having to call them in over the phone (saving time)
    3) are there any cost effective solutions that combine all the different things a small business like ours does: farmer’s markets, shows, online, and over the phone… (the square app is great for processing cards on the spot, having the ability to call credit cards in ensures that the orders are correct and there aren’t any issues or changes that should be made before they are called in)

    I hope the questions make sense… I know there are a lot of people who use mals cart and do so because it so easy and cost effective to use!

    Thanks for all your great advice and help to so many small business people! -Ellie + Sophia

    1. Brian Anderson says:

      Paypal now has an adapter like square you can take with you to shows. I have been primarily using Square, but Paypal can become cheaper quickly with just even a small bump in volume. Many vendors are providing these services, Intuit has a card reader for iPhone/iPad as well.

  7. Arturo says:

    Hi Steve,

    My wife and I have been following your blog for many months now and we love all the information in it.

    We’re getting ready to launch her online store and we’re at the point where we have to start thinking about credit card processors online so your article was exactly timed for us. I don’t like the stories about PayPal that I’m hearing and so I wanted to check out MerchantPlus like you recommend. Unfortunately, as of today their SSL certificate has expired (it expired on 10/29/2011). I’m worried that a merchant for whom not having a valid SSL certificate means the end of their business model has allowed the SSL certificate to expire and has been using an expired SSL for 15 days!! Since you use them are you having any issues with their certificates? Is it possible that the certificate that expired is for a part of their website that doesn’t process transactions? Also, do you know if they have an API of some kind?


  8. Steve says:

    Hi Arturo,

    Are you sure that you are on the right site? Their SSL certificate looks perfectly fine with me.

  9. Steve says:


    So I looked at their cert in detail and it expires 4/2012 which means that they didn’t just renew it either. Can you send me the link where it’s expired?

  10. Arturo says:

    Hi Steve,

    The link is I talked to their customer service reps, and it looks like that page should not have an SSL after all, but they’re looking into it. Sorry about the false alarm.


  11. Vincent D says:

    Just FYI. The public is getting angry over Paypal’s freezing accounts and only leave it up to automated machine to resolve the problems (or humans that speak like machines).

    I’m seriously looking for a Paypal’s alternative. Google Checkout is so far so good but lately it is not in their business focus so their applications are not being updated to be compatible with new ecommerce websites 🙁

  12. Raul says:

    Hi Steve nice article, I work online and I’m a newbie, so I have my payment through paypal and I think I got ripped off when I withdraw my money, so thanks for this great article I’m thinking of switching to Merchant Plus. but anyway thanks for this article it’s a big help.. 🙂

  13. Traci Bunkers says:

    Thanks for the informative article! One thing I’m not quite clear on is if I signed up for Merchant Plus, would I still need to sign up for to have the gateway? So that would be $19.95/month for Merchant Plus + $9.95/month for$29.90/month plus transaction fees, correct? (But it would be a little cheaper if your coupon is still good–I didn’t see any dates for when this was posted, or if the coupon has an expiration date.)


    1. Steve says:

      Yes you are correct. The coupon code listed above has no expiration date so feel free to use it anytime.

  14. Sam Lau says:

    Paypal is no good and they come up with lame excuses when they are not dealing fairly with their customers. I will choose to go with Authorize any how. Pls beware of Paypal as they are up to no good.

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  16. Persian and Oriental Rugs says:

    We were using Paypal for our website for the last few years but its risky to work with them as they will frequently nag you with holds, additional info required type of questions. is no brainer for us then after reading your analysis we’re seriously considering Merchant Plus. Thanks for your analysis!

  17. Alan says:

    I started to accept at my ebay store. Now I am accepting both Paypal and credit card payments. The problem i am running into is that transactions that are being purchased by credit card are being held up by Paypal. How can this be and will I be paying fees to both the credit card company ( and Paypal?

  18. Michael says:

    Hi Steve,

    Greetings from Singapore. Chanced upon your website and I learnt a ton from your insightful writings.

    I would like to ask if there is a difference between merchantplus and merchantinc? Seems merchantinc is considered a good alternative to paypal. Never had issues with paypal but looking for alternative. As they say, never put all your eggs in one basket!



  19. Anna Kieken, PhD says:

    Re: Paypal Website Payments Pro Vs – A Comparison Of Two Credit Card Processing Solutions
    Excellent, excellent article! Your ability to analyze, compare, and contrast are stunning. And your writing is clear and accessible. All the best.

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  21. Navinsam says:

    Hi Steve,

    I have a serious question to ask you or anyone with experience.

    Is the a way for a person living outside of the United States to get

    I do not recommend paypal for any serious business owners. I’ve no idea how you keep using it making the money you are, but paypal is horrible for long term business.


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