The verdict
If you run a shop, freelance or sell to consumers who like paying with an account they already have, I'd pick PayPal, mainly as a payment method next to cards and local methods. If you sell software, subscriptions or usage-based services internationally and want a merchant of record to handle tax, I'd pick Polar.
I would not use PayPal as the only payment layer for a software business that scales. It does not handle tax as a merchant of record would, and it is not built for complex billing. I would not use Polar for a simple local shop either. Check Polar's supported countries and acceptable use policy before you build on it.
Side by side
| 6 points compared | ||
|---|---|---|
| Starts at | $20/mo | |
| Free plan | Yes | Yes |
| API | Yes | Yes |
| MCP server | Yes | Yes |
| Dunning & churn recovery | Yes | Yes |
| Hosted self-serve checkout | Yes | Yes |
| Links |
Plans and pricing
PayPal
- Standard business accountFree
Polar
- StarterFree
- Pro$20/mo
- Growth$100/mo
- Scale$400/mo
Who each is for
Choose PayPal if…
Pick PayPal if you sell online to consumers and want to cut friction at checkout. Many people trust an account they already hold, and some will leave a shop that does not offer it.
It is also the quickest way to get paid. You can send a payment link or an invoice without a website, a storefront or hardware, and you can go further with a full API and a sandbox.
The fee depends on country, method and volume, so read the table for your case. Small orders feel the fixed part most. For Dutch buyers, iDEAL has its own fee and often matters as much. PayPal's seller protection has conditions, so read them before you rely on it.
Choose Polar if…
Pick Polar if you are a developer or a small software team selling subscriptions, licences or usage-based services to customers in many countries. As merchant of record, Polar calculates, collects and remits the tax, and you receive a payout.
It handles meters for API calls or tokens, seat-based and unit-based pricing, and automated benefits such as licence keys, file downloads, GitHub repository access and Discord roles. There are SDKs, framework adapters, a sandbox and an official MCP server that uses OAuth.
You can start on the free plan and compare the paid tiers as volume grows. The trade-off is less control than your own set-up, and usage billing only works if your product emits clean events.
Other options worth a look
Handle global subscriptions, payments and tax compliance without managing VAT registration across 300+ markets.
Acts as merchant of record for software and digital product sales, handling global tax compliance.
Manages subscription billing, invoicing and revenue recognition for recurring businesses with your own payment gateways.
Send invoices, track expenses, reconcile banks and prepare VAT returns for Dutch small businesses.
Ties agency projects, time, budgets and profitability together in one place for managing client work.