Fees, tax handling, payouts and coverage side by side, plus how many verified RevMRR startups use each.
The short version
Both are merchants of record, so tax and VAT are handled either way. The choice mostly comes down to fees, payouts and features.
On the standard published rate, Paddle (5% + 50¢) is cheaper per transaction than FastSpring (5.9%).
Pick FastSpring for: software, SaaS, game and digital-product sellers with meaningful international consumer revenue, who would otherwise have to register for VAT and sales tax across many jurisdictions, and who value not owning fraud and chargeback exposure more than they value the last few points of margin. Also strong for teams selling subscriptions where dunning, proration and localised checkout would otherwise be an engineering project..
Pick Paddle for: software, SaaS, AI and digital product companies selling to customers in many countries, especially small teams without a finance function, who would rather pay a premium than register for VAT in twenty jurisdictions and be liable when they get one wrong..
Founded in 2005, based in Santa Barbara, California, United States
Founded in 2012, based in London, United Kingdom
Payment methods
Cards, Apple Pay, Google Pay, Local Payment Methods
Cards, Apple Pay, Google Pay, Local Payment Methods
Best for
Software, SaaS, game and digital-product sellers with meaningful international consumer revenue, who would otherwise have to register for VAT and sales tax across many jurisdictions, and who value not owning fraud and chargeback exposure more than they value the last few points of margin. Also strong for teams selling subscriptions where dunning, proration and localised checkout would otherwise be an engineering project.
Software, SaaS, AI and digital product companies selling to customers in many countries, especially small teams without a finance function, who would rather pay a premium than register for VAT in twenty jurisdictions and be liable when they get one wrong.
Used on RevMRR
Not connectable yet
0 verified startups
FastSpring
FastSpring solves a specific and genuinely painful problem: selling digital goods to consumers in dozens of countries without building a global tax, fraud and refund operation. As merchant of record it absorbs all of that, and after twenty-one years it is one of the few companies in the category with a long enough track record to judge. The cost of that is a commission that is a multiple of card processing, and FastSpring will not quote it publicly. If you are choosing it, choose it because tax and compliance are the constraint — not because you think it is a cheaper way to take a card.
+ Twenty-one years in business — founded in Santa Barbara in June 2005 — which in the merchant-of-record category is a very long track record.
+ A BBB A- with the only stated deduction being a failure to respond to one complaint. That is a clean file by payments standards.
+ The tax burden genuinely moves. FastSpring is the legal seller, so sales tax, VAT and GST registration and remittance across 200-plus regions are its obligation, not yours.
+ Fraud and chargeback losses sit with FastSpring rather than being passed through, which aligns its risk decisions with the seller's revenue.
+ One commission covers everything — subscriptions, tax, fraud, invoicing, affiliate tools — with no subscription fee and no minimum volume, so there is no module-by-module upsell.
+ Payout mechanics are documented in unusual detail for this industry: three schedule options, a stated $100 minimum, the 14-day settlement delay and the refund-method charges are all published rather than left to a sales call.
– No published rates at all. The pricing page describes the model and then routes you to sales, so you cannot compare FastSpring to an alternative without entering a sales process.
– The commission is a multiple of card processing. Third-party reviewers cite a baseline near 5.9% plus $0.95 and up to 8.9% for lower-volume or higher-risk accounts; even discounting competitor sources, nobody claims this is cheap.
– The fixed per-transaction component is brutal on small subscriptions. A low monthly price point pays a much higher effective rate than the headline percentage suggests.
– A 45-day monitoring hold applies to new accounts before the first payout is scheduled. That is a real launch cash-flow problem if you are not expecting it.
– A 14-day settlement delay applies to every transaction on top of the payout schedule, and there is a $100 minimum payout below which balances roll over.
– As merchant of record you give up the payment stack: no gateway choice, no interchange negotiation, no direct acquirer relationship, and limited leverage if the rate stops working for you.
Paddle sells one thing that a payment processor cannot: it becomes the legal seller of your software, which moves global sales tax and VAT registration, filing and liability off your company and onto Paddle's. For a small software team selling into dozens of countries, that is worth real money and a great deal of avoided risk, and 5% + 50¢ with no monthly fee is an honest, published price for it. The costs are equally concrete — the rate is roughly double a card processor's, payouts arrive once a month on the 15th rather than daily, FX margins of 2% to 3% when a sale converts into your balance currency, up to a further 1.5% if you take payout in a different currency, and a $15 SWIFT fee can apply on top, and both the customer relationship of record and the tax registrations belong to Paddle, which makes leaving a project rather than a cancellation.
+ One flat, published price: 5% + 50¢ per checkout transaction, with no monthly fee, no migration fee and no setup cost. You can model your cost exactly before you sign up, which is rare in payments.
+ As merchant of record, Paddle takes on global sales tax, VAT and GST — registering, collecting, filing and remitting wherever your sales create an obligation — and carries the liability for getting it right. That is the whole product, and it is genuinely hard to replicate in-house.
+ Fraud screening and disputes run against Paddle's merchant account, not yours, so your business does not accumulate a chargeback ratio with the card networks — the metric that gets ordinary merchants terminated.
+ Subscription billing, dunning and churn-prevention tooling — including the ProfitWell products Paddle bought for $200 million in May 2022 — are bundled into the base rate rather than sold as tiers.
+ Sensible payout controls: you choose your own payout threshold anywhere from $100 to $100,000, and where your payout currency matches your bank's local currency the transfer is typically free.
Fees are each provider's standard published rate for a domestic online card payment and can change. Confirm on the provider's pricing page before deciding.
+ Real scale and funding behind it. Paddle said in July 2025 that it serves over 6,000 digital product companies, was growing 40% year over year, and had raised more than $300 million from investors including KKR, FTV Capital and 83North, plus a $25 million round led by CIBC Innovation Banking.
– 5% + 50¢ is roughly double what a card processor charges. On a $100,000 month that is $5,000 plus per-transaction fees against perhaps $3,000 with a mainstream PSP — the tax work has to be worth $2,000 a month to you, and above a certain volume it stops being.
– Payouts are monthly, not daily. Paddle processes on the 1st and sends by the 15th, with up to three working days after that, and there is no on-demand withdrawal. A business used to next-day settlement is looking at a structural change to its working capital.
– Currency conversion is charged twice over: a margin of 2% to 3% when a sale is converted into your balance currency, and up to a further 1.5% on a payout taken in a different currency. SWIFT transfers to certain countries carry a $/£/€15 wire fee. None of it appears in the headline 5% + 50¢.
– Chargebacks cost 20 USD/GBP/EUR or 40 CAD/AUD, the fee is not returned even when Paddle wins the dispute, and it is charged again when a pre-chargeback alert arrives and Paddle refunds proactively — so a dispute you never see can still bill you.
– Digital products only. Paddle is built for software, SaaS and AI companies; it is not a route to accepting payments for physical goods or in-person services.
– Trustpilot sits at 3.9 with a hollow middle — 73% five-star against 21% one-star — and the seller-side complaints are the serious kind: accounts blocked with payouts frozen and no explanation given, and domain validation checks stuck for over a month with support unresponsive. Much of the rest of that corpus is end customers who saw Paddle on a card statement rather than merchants.
