Authorize.net vs PayPal: A Comparison

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    As your business grows, you may want to think about offering more payment options to your customer base. Using services like Authorize.net and PayPal can provide greater flexibility in terms of accepting payment installment plans, multiple currencies, and touchless payments. 

    Learning about the pros and cons of each platform, along with its pricing range, can help you decide which option is a better fit for your business. 


    Authorize.net vs PayPal

    Authorize.net is a payment gateway that allows eCommerce businesses to accept transactions through a payment processor. On the other hand, PayPal is a comprehensive payment processing service that combines a payment gateway with providing payment processing in-house. 

    Pros and Cons of Authorize.net 


    • Provides 24/7 customer support: If you run into any problems with Auth net gateway billing, they offer phone support at all times unless it is a holiday, along with online chat options and a comprehensive knowledge base.  
    • Relatively affordable cost: When it comes to merchant accounts, Authorize.net charges flat-rate transaction fees cheaper than PayPal’s since PayPal charges more for American Express payments.   
    • Offers recurring billing options: Unlike PayPal, Authorize.net includes recurring billing in all plans, and you don’t have to pay extra fees to use this feature 


    • Lacks currency options: Authorize.net only supports local currency options for American and Canadian businesses. However, UK and European businesses can use up to 8 currencies while Australian businesses can use 3.  
    • Monthly fees can add up: Authorize.net charges a $25 monthly fee, but this can be worth it depending on the number of sales you make per month. 
    • Lacks a free trial: You will need to pay their fees to try out their service, although there are no long term contracts 

    Pros and Cons of PayPal


    • Transparent pricing: PayPal provides clear information on transaction fees on their website 
    • Easy signup process and use: PayPal’s account system and user interface is easy to use for beginners and payment integration is also simple for those with no programming knowledge
    • Accepts plenty of currency types: Unlike Authorize.net, PayPal is available in more than 200 countries/regions and takes 25 currencies
    • Good customer support: PayPal offers phone support from 8 am-8 pm CST from Monday to Friday in addition to text support and an online community 


    • Higher transaction fees: Compared to auth net gateway billing, PayPal is generally more pricey based on their transaction fees 
    • Charges extra for services: If you need automated recurring billing, you will need to pay extra unlike Authorize.net which provides it for free  
    • Higher merchant fees: PayPal charges higher rates for some newer products, like PayPal Checkout, and Pay with Venmo

    Overview of Authorize.net’s Features

    Authorize.net provides users with two different plans for payment processing, one with a payment gateway only and one with a merchant account and a payment gateway. It integrates with plenty of popular platforms, including BigCommerce and Magneto. 


    This plan is ideal for small businesses looking for a complete solution. It comes with automated recurring billing, which is useful for businesses that sell subscription-based goods and services, but they charge extra for ACH payments.

    Payment Gateway Only

    For those who already have a merchant account, Authorize provides this option. It allows you to combine all your transactions from a single day into a batch that is sent to payment processing networks. It comes with automated recurring billing, but you will also need to pay extra for ACH. 

    Overview of PayPal’s Features

    PayPal offers two plans for small businesses: PayPal Payments Standard and PayPal Payments Pro. PayPal’s services are also compatible with many eCommerce platforms such as Wix, BigCommerce, and Shopify. 

    PayPal Payments Standard

    To integrate PayPal payments without a web developer, all you’ll need to do is copy and paste their code or use a plug-in with an existing shopping cart which can take about 15 minutes all in all. 

    PayPal Payments Pro

    For a more advanced payment solution, this plan gives you a virtual terminal so you can accept cards through mobile and other devices that don’t have a card reader and accept phone payments as well.

    Authorize.net vs. PayPal: Pricing Comparison

    Monthly fees
    $25 per month PayPal Payments Standard charges zero monthly feesPayPal Payments Pro costs $30 per month.
    Transaction fees
    2.9% + 30 cents per transaction with a merchant account.10 cents per transaction and 10 cents daily batch fee for payment gateway only account. PayPal offers discounted pricing for nonprofits, but transaction fees are variable according to their website. 
    Other fees
    Custom pricing is available for businesses that process sales volumes of over $500,000 per year.Add-on recurring billing services cost $10 per month.Add-on Fraud Protection Services cost $10 per month plus 5 cents per transaction.

    Quick heads up Learn 6 PayPal Alternatives for Business Owners

    Frequently Asked Questions

    These answers can help you understand the basics of payment processing for Authorize.net and PayPal. 

    Does Authorize.net hold payments?

    Authorize.net can hold funds due to chargeback reasons and other factors. 

    Can I cancel PayPal authorization?

    PayPal sellers have the ability to cancel a PayPal order or authorization unless the payment has already been completed. 

    Is Authorize.net owned by Visa?

    Yes, Authorize.net is a subsidiary of Visa and was initially acquired in 2010. 

    Final Thoughts

    Ideally, PayPal is the best fit for small online businesses with customers from around the world. However, Authorize.net provides more affordable pricing for businesses on a budget. 

    Feel free to check out our comparison of top online payment processors at Processing Card today!