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Square vs. PayPal Here: Which Is Right for Your Business?

Maddie Shepherd

Staff Writer at Fundera
Maddie Shepherd is staff writer at Fundera. Beyond her deep knowledge of small business financing, Maddie's specialty is business credit cards—she'd love to help match your business with the credit card that benefits you most!

Choosing the perfect point of sale system for your business is no joke. Credit card processing statistics show not only that credit card payments are growing at the highest rate but also that U.S. merchants spent $7 billion in credit card processing fees in 2017. So it’s no wonder that small businesses are taking their point of sale choice seriously now more than ever.

Square and PayPal are two of the most popular, well-regarded, and easy-to-use point of sale options on the market. As a result, many small business owners narrow down their search to Square point of sale systems and PayPal Here.

But how should you decide between Square vs. PayPal Here? Both of these app-based, device-enabled point of sale systems offer some pretty stellar features, so choosing between Square vs. PayPal Here will depend on your business’s unique needs. As such, we’ve compiled all the pertinent information you’ll need to compare and contrast Square and PayPal Here:

The Details on Square Point of Sale System Offerings

Of all the top PayPal alternatives we’ve researched, Square is really one of the only competitors that can sit with PayPal as a household name. To be sure, small business payment processing isn’t such a widely discussed topic, but because Square has been able to disrupt and democratize point of sale systems so drastically, they’ve been an easily recognizable brand.

But beyond the Square brand, what can Square point of sale systems offer your small business? The first step to choosing between PayPal vs. Square will be learning about the core details of these two options. So, let’s dive into the info you need on Square to make the best decision possible:

Square Features

If you end up opting for Square in the Square vs. PayPal Here showdown, you’ll be able to choose between two Square point of sale software options: Square Point of Sale and Square for Retail.

Square Point of Sale is a free app and comes with the following features:

  • Open tabs
  • Split tabs
  • Manage inventory
  • Track employee hours
  • Reconcile tips and commissions based on timecards

On the other hand, Square for Retail will cost your business $60, but for that cost you’ll be able to access all the capabilities of the Square POS app, plus:

  • Inventory alerts
  • In-app purchase orders
  • Inventory tracking across multiple locations
  • Elevated customer relationship management capabilities

square vs. paypal

Square Hardware Pricing

Square POS hardware comes in many different shapes, sizes, and, of course, prices. There are five Square reader options, and they range in pricing from free all the way up to $999, so you’ve certainly got options.

Here are the details on Square reader pricing:

While three of the five Square hardware options are mobile, smart device-reliant readers, two of them are countertop POS systems, and one of these countertop POS systems is completely stand-alone and doesn’t require a smart device.

With these five Square reader and POS system options, you’ll be able to mix and match to build the perfect POS fleet for your small business.

Square Payment Processing Fees

Square’s fees depend on a few factors. For manual card entry, Square charges 3.5% of the transaction value, plus $0.15 per transaction. For payments that you process through a piece of Square hardware (other than the Square Register), you’ll have to pay an even 2.75% of the transaction value. And payments that you process through the Square Register will cost 2.5% of the transaction value, plus $0.10 per transaction.

The Details on PayPal Here Offerings

PayPal’s Square counterpart is their payments app PayPal Here. Through PayPal Here, you’ll be able to reader cards and process payments through a smart device in person—without having to manually enter their card information. Here’s more information to help you decide if PayPal Here is your winner in PayPal vs. Square:

PayPal Here Features

With the free PayPal Here app, you’ll be able to customize your business profile, customize your receipts, and calculate sales tax. Additionally, you’ll be able to create a product list with pictures and descriptions, which will mean quicker, easier checkout processes for employees and customers.

You’ll even be able to set up employee roles and permissions within the app. With these roles and permissions, you’ll be able to track sales by employee in the app, as well.

PayPal Here Hardware Pricing

Unlike the rainbow of POS hardware options offered by Square, PayPal Here’s hardware options are limited to card readers that rely on a smart device function. Here are the details on the four card reader choices that PayPal Here offers small businesses:

Compared to Square hardware options, PayPal Here hardware options are a bit more sparse. All of them rely on a smart device, and all of them are completely mobile, non-countertop points of sale. If you’re looking for a countertop system, then Square will be your only option in Square vs. PayPal Here.

PayPal Here Payment Processing Fees

Just like Square, PayPal Here charges payment processing fees based on how you process a given payment. In fact, PayPal vs. Square fees don’t look much different from each other: For transactions you manually enter, you’ll pay 3.5% of the transaction value, plus $0.15 for each transaction. For payments you process through a PayPal Here card reader, you’ll simply have to pay 2.7% of the transaction value.

To invoice a customer through PayPal Here, you’ll have to pay 2.7% of the invoice value, plus $0.30 per invoice.  And, finally, if a transaction involves a cross-border transfer, then you’ll have to pay an additional 1.5% of the transaction amount.

square vs. paypal

Where Square Wins in Square vs. PayPal Here

Where does Square beat its opponent in Square vs. PayPal Here? Well, there are a few fundamental perks to opting for Square over PayPal Here. For one, Square offers many more hardware options than PayPal Here, especially if you’re looking for a countertop POS system option. Plus, Square offers a free card reader when you open your account with them, which PayPal Here doesn’t.

Beyond hardware offerings, Square POS also offers two software options to choose from, and both of these options offer much more powerful inventory tracking and customer tracking than PayPal Here can.

All in all, if you’re primarily processing payments in person, then we suggest you choose Square in deciding between Square vs. PayPal Here. The superior countertop hardware, inventory tracking, and customer tracking that Square offers makes it more ideal for retail businesses that typically process face-to-face payments.

Where PayPal Here Wins in Square vs. PayPal Here

The way we see it, PayPal Here should really be your winner for Square vs. PayPal Here if you’re already processing a majority of your payments through PayPal’s online payment processing. Whereas Square POS systems are more stand-alone points of sale, we see PayPal Here as a supplement to a PayPal account for businesses that primarily process payments online.

So, if you’re looking to have a more convenient way to charge your customers if you’re processing a one-off, in-person payment, then PayPal Here would be ideal for that. Their slightly lower payment processing fees are a nice add-on to the convenience that PayPal Here offers, but the software and hardware that PayPal Here offers aren’t quite enough to serve as a full-fledged POS system for high-volume, in-person retail businesses.

The Verdict on Square vs. PayPal Here

At the end of the day, it’s hard to go wrong when the two options you’re debating are Square vs. PayPal Here. These two products have proved that online and device-based payment processing are far from short-lived payment processing trends; rather they’re a whole new era of convenient, accessible point of sale technology. Deciding the better option for your business between Square vs. PayPal Here will be about your business’s specific needs and situation: Retail businesses in need of a countertop, high-powered point of sale should go with Square, while primarily online businesses (especially those who already use PayPal for online payment processing) will do well to opt for PayPal Here.

Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved, or otherwise endorsed by any of these entities.

Maddie Shepherd

Staff Writer at Fundera
Maddie Shepherd is staff writer at Fundera. Beyond her deep knowledge of small business financing, Maddie's specialty is business credit cards—she'd love to help match your business with the credit card that benefits you most!

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