How is Braintree different from PayPal?

Remay Villaester (May)
6 minute read

You probably know that nowadays, there’s an urgency to pay for products and services in various industries, such as SaaS companies, e-commerce shops, and services like Uber and many others. Did you know that almost 50 percent of modern online shoppers these days will likely abandon their shopping carts if your application or website does not have their preferred method of payment?¹ However, there are over seventy payment systems, and each system has different terms, features, and fees.

If you have decided to add a modern payment platform to your website or mobile application, we will advise you on some alternative methods of payment online. So, let's draw our attention to PayPal and Braintree payment platforms. This is because they are the leaders in today’s market. And if you are looking to incorporate a reliable payment platform into your website or mobile app, you will likely make a choice from among these two options.

We will discuss ‘how is Braintree different from PayPal’ and also demonstrate how you can save money by using TransferWise for Business in addition to your payment gateway for sending and receiving transfers in different currencies.

Things to Consider when Choosing a Payment Gateway

There is no doubt that a payment gateway is an essential middleman in the overall payments process. When your customers make a purchase on your website with a credit card, then a payment gateway will encrypt the data and send it to your payment processor for timely authorization. On approval, the payment gateway will let your e-commerce platform know, so that the transfer of funds may take place.²

Keep in mind that selecting the most suitable payment gateway solution for your e-commerce business can usually decide whether your online store will be profitable or not. So, it is advisable to closely monitor and assess the payment bottom-line of the online store in order to ensure both long-term success as well as profitability.

Here are a few things that you should consider.

1. Security features

Note that the first and most important place to begin is with security. This is why the most secure and reliable payment gateways usually feature P2PE (point-to-point encryption). And this fully protects your confidential data across a stable and secure environment during all steps of the transaction.³

2. Sign-Up Charge

If you’re just starting your e-commerce shop or working on a fixed budget, then it is advisable to use a service provider that has no sign-up fees.

However, if you want to have some specific features or are planning to sell a large volume of merchandise, payment gateways that have a sign-up fee might be more effective and suitable in the long run.

3. Compliance with Payment Gateway Requirements

Merchants and online stores that accept payments online also need a payment gateway to fully and effectively protect their customers and businesses while meeting all compliance requirements.

In this regard, PCI DSS (Payment Card Industry Data Security Standard) is a widely known industry set of effective security standards for businesses that accept, store, process, or transmit their credit card data. Note that to make compliance simpler and less burdensome for most merchants, many payment gateway providers take on full responsibility for ensuring that your credit offers align with all local legislation.

So, how is Braintree different from PayPal? We will explore this in the next section.


PayPal bought Braintree back in 2013.⁴ One of the key issues with PayPal was the redirection of users from the seller or merchant’s site to the PayPal server. Also, it required users to be registered service users. So, you can imagine that it was the main reason for dissatisfaction for both parties. Hence, the decision to purchase Braintree solved this problem.

The great thing about Braintree is that it provides developers with adjusted API interfaces and SDKs in 6 programming languages along with amazing ready-made solutions for baskets. And with PayPal's Commerce feature, dealers can easily integrate many purchase buttons into apps, like Pinterest and Facebook Messenger, which is great.⁵


There is no doubt that PayPal can also become an excellent alternative to several other integrated payment systems on your website or mobile application. Of course, you can integrate it as the main solution; however, keep in mind that many brands usually consider it as a good alternative.

This is because some users do not want their sensitive credit card information to be stored on all trading platforms where they order. Also, you will be glad to know that PayPal is a good choice for startups as well as small vendors. This is because it pools money from all of the merchants into one aggregate account, and that is very convenient.

And all platforms support PayPal. And since PayPal redirects customers to its site, you do not need any payment gateway integration as well. If you would like to add PayPal Express, then redirection will usually be skipped, and, hence, Express API will submit all of the required information.

4. Cost

Cost is an important factor when choosing a payment gateway for your business. Here is how these 2 platforms compare in terms of cost.

Note that Braintree does not charge a monthly payment to process online payments, which is great. Braintree charges a commission on a per-transaction basis at a rate of about 1.9% from transaction amount in addition to 20 cents for each transaction.⁶

Braintree pricing for accepting cards and digital wallets:

1.9% + £0.20 per transaction

  • An additional 1% fee applies to transactions from cards issued outside of the EU / EEA.
  • A flat £20 fee is assessed for chargebacks
  • Processing fees are not returned for refunded transactions.
  • American Express transactions will be charged 2.4% + £0.20.
  • For merchants that have their own American Express account, Braintree can pass through American Express transactions at a cost of £0.20 per transaction with no additional Braintree fees. Merchants may be subject to additional fees assessed by American Express under their direct card acceptance agreement with American Express.
  • Discounted rates are available for business processing over £50K per month.
  • Interchange plus pricing is also available for merchants in Europe.

PayPal Pricing

With PayPal, you do not need to pay any subscription fee. You will be charged a standard rate of 3.4% plus 30 cents for each transaction within the UK. The additional fix fee will depend on the currency you receive.⁷

Save more on your sales with TransferWise

If you’re a global trader, you probably know how important it is to pay attention to the conversion rate and fee to exchange your sales money to local currency because if you don’t use the right partner, you could end up paying up to 4% on fees. That’s £40 for every £1000 of your sales which for some online sellers can almost amount to their profit margin.

The solution is to have multi-currency accounts like TransferWise. With this additional financial tool, you can receive money on different currencies for free and convert them in your local currency at the real market rate, no mark-up for a small and transparent fee - up to 19x cheaper than using PayPal for currency conversion.

This modern solution can also be integrated to your favorite accounting software like QuickBooks, FreeAgent, and Xero to simplify your tax reconciliation.

The account also comes with a multi-currency debit card that you can use to pay vendors and suppliers or simply for your daily purchases. Combining this service with your Braintree or PayPal can mean saving up 4% on fees.

Plus, TransferWise has a team ready to help businesses fully automate their payouts and more using the API.

Start saving today with TransferWise

Or, get in touch to learn more


  1. Quick Sprout blog post
  2. Securion Pay blog post
  3. PCI Security Standards blog post
  4. Forbes blog post
  5. Braintree price page
  6. Braintree Price page
  7. PayPal merchant fee

This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from TransferWise Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.

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