Stripe vs Lemon Squeezy vs Paddle 2026
The definitive comparison of payment processors for SaaS, digital products, and subscription businesses. Learn about Merchant of Record services, global tax compliance, and which platform is right for you.
Quick Verdict
Best for developers who want full control and don't mind handling tax compliance themselves.
Best all-in-one solution for indie hackers and SaaS founders. Built-in MoR, affiliates, and more.
Best for established SaaS companies needing comprehensive MoR with enterprise features.
🚨 Major Update: Stripe Acquired Lemon Squeezy (July 2024)
In July 2024, Stripe acquired Lemon Squeezy, signaling a major push into the Merchant of Record space. Lemon Squeezy continues to operate independently, but future integrations are expected. This also means Stripe is now offering its own MoR service (Stripe Managed Payments) at ~7.9% + $0.30 per transaction.
Platform Overview
Each platform serves different needs. Here's a quick breakdown to help you understand the key differences.
Stripe
Developer-first payment infrastructure
2.9% + $0.30
per transaction
- Flexible APIs & SDKs
- 135+ currencies supported
- Advanced fraud detection (Radar)
- Subscription billing tools
- Global payouts to 50+ countries
- Extensive documentation
Best for: Developers who want maximum control and are willing to handle tax compliance
Lemon Squeezy
All-in-one commerce for SaaS
5% + $0.50
per transaction
- Full Merchant of Record
- Automatic global tax handling
- Built-in affiliate system
- License key management
- Email marketing tools
- Abandoned cart recovery
Best for: Solo founders, indie hackers, and small SaaS teams
Paddle
Complete commerce for SaaS
5% + $0.50
per transaction
- Full Merchant of Record
- Tax compliance in 200+ markets
- Revenue recovery tools
- Multi-product catalogs
- First-level customer support
- Advanced analytics
Best for: Established SaaS companies needing hands-off tax compliance
What is Merchant of Record (MoR)?
A Merchant of Record is the legal entity that sells products to customers. When you use an MoR like Lemon Squeezy or Paddle, they become the seller of record, not you. This means:
MoR Handles
- • Global sales tax calculation & remittance
- • VAT/GST compliance in 100+ countries
- • Invoicing with proper tax documentation
- • Chargeback and fraud protection
- • Legal liability for transactions
Without MoR, You Handle
- • Register for VAT in each EU country
- • File tax returns in multiple jurisdictions
- • Maintain compliant invoices worldwide
- • Handle audits and legal requirements
- • Assume full liability for transactions
💡 Pro Tip: If you're selling to customers in the EU, UK, or other VAT regions, an MoR can save you 10-20+ hours per month on tax compliance alone.
Pricing Breakdown
Understanding the true cost is crucial. Here's a detailed breakdown of what you'll actually pay.
Stripe
Additional:
- • *MoR via Managed Payments (beta)
- • +0.5% for instant payouts
- • Currency conversion: 1%
Lemon Squeezy
Additional:
- • +0.5% for subscriptions
- • Tax handling included
- • No monthly fees
Paddle
Additional:
- • Tax handling included
- • No monthly fees
- • Volume discounts available
💰 Real Cost Example: $10,000 MRR (50% international)
| Platform | Domestic ($5K) | International ($5K) | Total Fees | You Keep |
|---|---|---|---|---|
| ~$160 | ~$210 | ~$370 | $9,630 |
| ~$410 | ~$460 | ~$870 | $9,130 |
| ~$275 | ~$350 | ~$625 | $9,375 |
| ~$275 | ~$375 | ~$650 | $9,350 |
*Estimates based on standard pricing. Actual fees may vary based on transaction sizes, payment methods, and volume.
Feature Comparison
A detailed breakdown of what each platform offers.
Core Features
Additional Features
Technical & Support
Geographic Coverage
Pros & Cons
Stripe
Pros
- Lowest base fees (2.9%)
- Best-in-class API & docs
- Most payment methods
- Advanced fraud protection
- Huge ecosystem
Cons
- No built-in tax handling
- MoR service expensive
- Requires more setup
- No affiliate system
Lemon Squeezy
Pros
- Full MoR included
- Built-in affiliates
- Email marketing tools
- Easy to set up
- Backed by Stripe
Cons
- Higher base fees (5%)
- Less mature than Paddle
- Limited enterprise features
- Acquisition uncertainty
Paddle
Pros
- Established MoR (10+ years)
- 200+ market coverage
- Customer support included
- Revenue optimization
- Volume discounts
Cons
- Higher base fees (5%)
- Restrictive business categories
- Slower support (reported)
- Account closures (rare)
Our Recommendations
Solo Founder / Indie Hacker
Go with Lemon Squeezy. The built-in MoR, affiliate system, and email tools save you from integrating 3-4 different services. The higher fee is worth the time saved on tax compliance alone.
Developer Building Custom Solution
Choose Stripe if you're comfortable handling tax compliance or only sell in one region. The API is unmatched, and you'll have complete control over the checkout experience.
Established SaaS ($50K+ MRR)
Consider Paddle for its enterprise features, customer billing support, and volume discounts. At scale, they can often match or beat Lemon Squeezy's effective rate.
Global Sales (Lots of EU/UK customers)
Use an MoR! Either Lemon Squeezy or Paddle. The VAT headache alone isn't worth the ~2% savings of using Stripe directly. Trust us on this one.
Frequently Asked Questions
Can I switch from Stripe to Lemon Squeezy later?
Yes, but it requires migrating your customer data and subscriptions. Lemon Squeezy provides migration tools, but plan for 2-4 weeks of work for a clean transition. The sooner you switch, the easier it is.
What happens to Lemon Squeezy after the Stripe acquisition?
As of early 2026, Lemon Squeezy continues to operate independently. Stripe has indicated they'll maintain the product, but future pricing or feature changes are possible. The Stripe backing actually adds stability.
Do I really need an MoR if I only sell in the US?
If you only sell to US customers, Stripe is fine. However, most SaaS companies eventually get international customers. The moment you have EU/UK sales, you'll want an MoR.
Which has better analytics?
Stripe has the most comprehensive analytics and reporting. Paddle has good revenue analytics built for SaaS. Lemon Squeezy is improving but currently offers basic analytics. All three integrate with tools like Chartmogul or Baremetrics for advanced metrics.
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