For most UK online sellers, this payment gateway comparison UK comes down to three real choices: Stripe if you have developer help and want the lowest headline card rate, PayPal if you want instant customer trust at checkout, or a full payment service provider like Worldpay or Adyen once volume justifies a negotiated rate. This guide compares the main UK gateways on fees, supported payment methods including open banking and Buy Now Pay Later, payout timing, chargeback handling and Strong Customer Authentication, plus when a gateway alone isn’t enough.
Payment gateway comparison UK: the main providers
Rates below were checked against provider pricing pages recently and can change without notice, so confirm the live figure before you build pricing assumptions around it.
| Provider | UK card rate | Monthly fee | Type | Best for |
| Stripe | 1.5% + 20p | None | PSP (pooled account) | Developer-led stores, subscriptions, marketplaces |
| PayPal Checkout | Roughly 1.2% to 2.9% + 30p, varies by product | None | PSP | Trust-driven checkout, fast setup, no code |
| Square Online | 1.4% + 25p | None | PSP | Sellers already using Square in-person |
| GoCardless | 1% + 20p (direct debit) | None on Standard | PSP | Subscriptions, invoices, recurring billing |
| Worldpay | From 1.5%, custom above that | Varies by plan | Full acquirer | High-volume retailers wanting a dedicated account |
| Adyen | Interchange++ + roughly £0.13 | Varies | Full acquirer | Larger, multi-market or multi-currency sellers |
| Opayo (Elavon) | Custom quote | Varies | Full acquirer with hosted checkout | Businesses wanting PCI compliance handled for them |
Best payment gateway UK by business type
There’s no single best payment gateway UK for every seller, since the right pick depends on technical resource and volume as much as price.
If you’re a small store with some developer support, Stripe’s 1.5% + 20p rate and documentation make it the default starting point, handling subscriptions, marketplaces and one-off sales from the same account. If you want to launch without writing code, PayPal Checkout gets you live fastest, and shoppers already trust the brand at the point of payment, which can lift conversion for a newer store even where the fee is higher.
Businesses running recurring billing (memberships, subscription boxes, service retainers) tend to do better on GoCardless, since direct debit at 1% + 20p avoids the higher failure and dispute rates of card-based recurring payments. Once monthly turnover passes roughly £50,000, get quotes from Worldpay or Adyen, since a negotiated interchange-plus rate at that volume usually beats any flat-rate PSP.
Stripe vs PayPal UK
Stripe vs PayPal UK is the comparison most first-time sellers actually search, since both let you take online payments the same day with no monthly fee.
Stripe’s advantage is control and cost at scale: a lower headline rate, a genuinely powerful API, and native tools for subscriptions, invoicing and marketplaces. The trade-off is that its raw checkout needs some setup, whether a plugin for Shopify or WooCommerce, or actual developer time for a custom build.
PayPal’s advantage is recognition. Shoppers who’ve never heard of your store still recognise the PayPal button, and for some sectors, higher-value one-off purchases and newer brands especially, that familiarity measurably reduces checkout abandonment. Its fees vary more by product than Stripe’s, so get an exact quote for your transaction pattern rather than assuming the headline rate applies.
At high volume, neither is likely to stay your cheapest option. Both offer custom pricing at real scale, roughly above £400,000 a year for Stripe, but at that level it’s worth comparing against Adyen or Worldpay’s interchange-plus rates too.
Payment gateway fees UK explained
Payment gateway fees UK typically combine a percentage of the transaction with a small fixed fee, and that fixed fee matters more than it looks on a low-value sale. A £5 sale on Stripe’s 1.5% + 20p costs 27.5p, an effective rate of 5.5%, while a £100 sale costs £1.70, an effective rate of 1.7%. If you sell low-ticket items, the fixed fee dominates your real cost far more than the headline percentage suggests.
Beyond the headline rate, watch for: an extra 1% to 1.5% on non-UK issued cards, a currency conversion markup if you accept or settle in a currency other than sterling, dispute fees (commonly £15 to £20 per case), and, on some providers, a separate charge for instant payout rather than standard settlement.
Payment gateway vs full payment service provider
A payment gateway, strictly speaking, is just the technology that captures and transmits card data securely from your checkout to the processor. A full payment service provider (PSP) bundles that gateway with a pooled merchant account, meaning you don’t need your own separate acquiring relationship to start taking payments.
Stripe, PayPal, Square and GoCardless are all PSPs in this sense: you get approved quickly because you’re underwritten as part of their existing merchant account rather than opening your own. Worldpay and Opayo, by contrast, sit closer to traditional gateways on top of a dedicated acquiring relationship, which takes longer to set up but can offer more negotiating room once you’re processing serious volume.
For most online sellers starting out, a PSP is the practical choice. Switching to a dedicated acquiring setup usually only pays off once a negotiated rate would meaningfully beat the PSP’s flat percentage, typically somewhere in the tens of thousands of pounds a month.
Supported payment methods: open banking and Buy Now Pay Later
Cards and digital wallets (Apple Pay, Google Pay) remain the baseline, but two other methods now show up on most UK checkouts.
Open banking payments, often branded Pay by Bank, let a customer pay directly from their bank account rather than entering card details, authorising the payment through their banking app. GoCardless offers this through Instant Bank Pay, and Stripe supports it too. It typically costs less per transaction than a card payment and settles faster, though customer familiarity is still lower than cards.
Buy Now Pay Later (BNPL) changed status significantly this year. From 15 July 2026, most BNPL products, now formally classified as Deferred Payment Credit, became regulated by the FCA. Providers including Klarna and Clearpay must now run affordability checks before approving a purchase, and customers get access to the Financial Ombudsman Service if something goes wrong. If you’re adding a BNPL option to checkout, confirm the provider is on the FCA’s register or operating under its temporary permissions regime before integrating, since this is a genuinely new requirement most older comparison guides won’t mention yet.
Strong Customer Authentication at checkout
Strong Customer Authentication (SCA), required under the Payment Services Regulations 2017 and enforced for UK e-commerce since 14 March 2022, means most online card payments need extra verification, usually via 3D Secure, before they’re approved. Nearly every modern gateway handles this automatically, triggering a one-time passcode or banking-app prompt only when the card issuer requires it. Some low-value or low-risk transactions qualify for an exemption and skip the extra step, which is worth checking if checkout abandonment on card payments seems unusually high.
Payout timing and chargeback handling
Payout timing varies meaningfully between providers. Stripe typically pays out on a rolling basis, often around two business days after a transaction once your first payout cycle (commonly seven to fourteen days for a new account) has completed. PayPal moves funds into your PayPal balance close to instantly, with a further one to two business days to reach your bank account. Worldpay and other traditional acquirers generally settle the next working day.
Most gateways charge a dispute fee, commonly £15 to £20, when a customer raises a chargeback, often refunded if you contest and win. Stripe and PayPal both provide a dashboard for submitting evidence, but the underlying deadline is set by the card scheme, generally around 120 days for the customer to raise a dispute and considerably less time for you to respond.
Selling in multiple currencies
If you sell beyond the UK, check whether a gateway supports settling in multiple currencies rather than converting everything to sterling automatically, what markup applies to conversion (commonly around 2%), and whether it supports local payment methods relevant to your customers, such as iDEAL in the Netherlands or Bancontact in Belgium.
Stripe, Adyen and Worldpay all support multi-currency settlement, letting you hold and pay out in the currency you were paid in rather than losing a conversion margin on every sale. For a smaller store selling mostly to UK customers, the standard conversion markup is rarely worth optimising around, but a business with meaningful EU or US sales can save a noticeable amount over a year with a multi-currency account.
FAQs
What is the best payment gateway for a small online business in the UK?
For most small UK online sellers, Stripe offers the best combination of low headline fees and flexibility, while PayPal Checkout suits businesses wanting the fastest, code-free setup. The right choice depends more on your technical resource and sales volume than on any single “best” answer.
Is Stripe or PayPal cheaper in the UK?
Stripe’s standard rate of 1.5% + 20p is generally lower than PayPal’s headline rate, though PayPal’s actual cost varies by product and can come close to Stripe’s for some transaction types. Get an exact quote from both based on your typical transaction value rather than comparing headline percentages alone.
What’s the difference between a payment gateway and a payment service provider?
A payment gateway is the technology that securely transmits card data from checkout to the processor, while a full payment service provider bundles that gateway with a pooled merchant account, letting you take payments without your own separate acquiring relationship. Stripe, PayPal and Square are all payment service providers in this sense.
How long does it take to get paid after an online sale?
Timing depends on the provider: PayPal moves funds into your account balance almost instantly with a further day or two to your bank, Stripe typically pays out around two business days after the transaction once your account is established, and traditional acquirers like Worldpay generally settle the next working day.
What is Strong Customer Authentication and does it affect my checkout?
Strong Customer Authentication (SCA) is a UK requirement, enforced for e-commerce since 14 March 2022, requiring extra verification, usually via 3D Secure, for most online card payments. Most gateways handle this automatically, though it can add a step to checkout that occasionally affects conversion.
What happens if a customer disputes a payment through my gateway?
The gateway usually charges a dispute fee, commonly £15 to £20, and gives you a window to submit evidence such as delivery confirmation or order correspondence before the case is decided. The underlying timeline is set by the card scheme rather than the gateway, generally allowing the customer up to around 120 days to raise the dispute in the first place.
