WePay vs. PayPal Fees: An Overview

Paypal was founded in 1998 as an alternative to traditional paper-based banking. The company's main focus is facilitating payments and enabling money transfers between businesses and people. As of 2020, Paypal has over 200 million users, is available in more than 200 countries, and transacts in 25 currencies. 

WePay was founded in 2008 as a way to collect money from various sources in a hassle-free manner. In 2011, the company began focusing on accepting credit card payments for small businesses. JPMorgan Chase & Co. acquired WePay in 2017, and WePay's three main services integrate with Chase bank.

PayPal Fees

PayPal is known and trusted by millions of people. The company uses this trustworthiness in its marketing strategies—an overview of their website encourages businesses to use PayPal and display the PayPal logo as a sign that the merchant is serious about business.

Key Takeaways

  • PayPal is an online payment systems company that facilitates money transfers and serves as an alternative to traditional paper payment methods.
  • WePay is an online payment systems company that provides integrated payment solutions to crowdfunding and SaaS platforms.
  • WePay offers three tiers of service—Link, Clear, and Core—which integrate into WePay's parent company, Chase.
  • Fees and restrictions vary between PayPal and WePay, making one more attractive than the other for some merchants.

PayPal transactions are completed within minutes, and the company promises that the money will be available for deposit or withdrawal to a bank account immediately. Money is secure, privacy is protected, and, since the customer base is so large, transactions are faster than traditional methods where customers enter their shipping information and payment details on the merchant site.

PayPal’s website advertises a 2.9% + $0.30 transaction fee, which works out to $3.20 for a $100 transaction. This sounds simple until you dig deeper and find all the different packages and services available to merchants.

PayPal Merchant Account

Merchants can sign up for merchant accounts and get merchant rates when they have over $3,000 in monthly sales. Merchant account fees for online transactions are 2.9% + $0.30 per transaction. Fees for doing business outside of the United States are 4.4% + $0.30 per transaction.

In addition, these fees exclude merchants whose average sale is less than $10 (micropayment transaction fees are lower at 5% to 6% + $0.05) and different still from the fees for merchants who sell digital goods (5% to 5.5% + $0.05, except Japan which is 5% to 5.3% + $0.05).

Finally, there are the merchants who either don’t want to send their customers to PayPal’s website to finalize payment or those who want phone and fax payment support or virtual terminals for their brick-and-mortar business. PayPal has solutions for those merchants, offering packages that have monthly fees and (sometimes) lower transaction fees.

WePay Fees

WePay, which is a JPMorgan Chase company, is an online payment system that provides integrated payment solutions primarily to SaaS and crowdfunding platforms. It is a bit different from PayPal. For starters, merchants integrate the payment system into their website to make the shopping experience seamless.

WePay has three distinct services. The first is called Link and is a way for merchants to conduct transactions through Chase's integrated payment service, while earnings fees, which can be automatically deposited into Chase bank accounts. The merchant's customers pay 2.9% + $0.25 for each transaction.

The second service WePay offers is known as Clear and is a white-label payment approach that allows merchants to set their own pricing. The service also enables merchants to integrate the payment data into their applications and then control how users experience the process. In short, Clear is a way for companies to leverage WePay's technology to offer online payment using their own brand.

Lastly, Core lets companies fully integrate into Chase's infrastructure, including payment processing and cash management. It gives the merchant control of the user experience and transaction life cycle. Core is the choice for companies that do a lot of transactions, want to become full-fledged payment facilitators, and hope to achieve economies of scale.

Key Differences

While WePay may appeal to merchants who don’t want to fuss with multiple pricing schemes, the services are sometimes more expensive than PayPal. A potentially huge benefit to WePay is that they do not redirect the customer to a third-party site—a feature that costs $10 to $35 per month on PayPal. Lastly, while both services have restrictions on the activities that their services can be used for, WePay’s list of prohibitive activities is much longer than PayPal’s.