Patreon VS PayPal: Comparison

Whether you’re looking to solicit donations, get people to pay for access to your content, or both, we’re here to help you choose between two powerhouse platforms: Patreon and PayPal. Let’s take a closer look at these two payment platforms that, despite their considerable differences, can be used by artists, gamers, podcasters, writers, and video streamers to draw an income.

Patreon VS PayPal: At A Glance Comparison

If you’re looking for a donation and/or subscription service to monetize the content you produce and you’re considering PayPal and Patreon, you should understand the differences between the two platforms. These differences will affect how you can get paid, what portion of your earnings will be taken by the platform, and more.

• Patreon is not for one-time donations. When you use Patreon, you invite people to subscribe to your campaign to access the content you decide to put behind your paywall. This means that you cannot accept a one-time contribution from somebody looking to access one particular piece of content.
• PayPal lets you accept both one-time and recurring payments. While you will have to pay more for the ability to accept recurring/subscription payments, the platform does support both kinds of payments.
• Patreon sets every creator up with a creator page. On this page, you can tell your story, detail your membership levels (if you offer more than one), and post your content. When you publish a post, you can either make its content free for everyone or you can make it subscriber-only. Depending on your Patreon subscription level, you’ll also have access to crowdfunding services like patron management, reward distribution, analytics, and more.
• Unlike Patreon, PayPal does not give you a creator page. If you want to use PayPal to accept donations and/or offer subscriptions on your web page à la Patreon, you can do so, but PayPal won’t provide the page for you — you’ll have to make one yourself. You also won’t get the extra crowdfunding features you can get with Patreon. If you want those, you’ll need to add them yourself through third-party software integrations with services like MailChimp.
• Patreon and PayPal have different fee structures. We’ll discuss fees and payments later, but for now, know that these differences affect how much you’ll pay each month, how much you’ll pay per transaction, how often you can withdraw your earnings, and more.

Where Patreon Wins

If you are a creator looking for a way to monetize your content, Patreon has far more features to help you with this goal than PayPal. That’s because Patreon was created as a crowdfunding platform based on subscription tiers. Winning Patreon campaigns focus on consistently offering new material to subscribers — it appeals to content creators who are looking for a way to diversify revenue streams.

With Patreon, you’ll receive a hosted creator page, communication tools that enable you to connect with your backers, and assistance with reward distribution. With a higher-level Patreon subscription, you’ll get access to features like the ability to offer different membership tiers, unlimited app integrations, analytics tools, team accounts, and a dedicated partner manager. However, as you’ll see in the Fees section, these features come at a price.

Here’s what Patreon does well:

Where Patreon Falls Short

We think Patreon is great for creators, especially ones who are looking for a basic and familiar platform that takes a lot of the guesswork/creative energy out of setting up a subscription service for content. However, if you have extensive web development abilities, you might be frustrated by the limiting interface of Patreon. It’s designed to be easy to use for everyone, which often means that there are few opportunities for customization.

Additionally, Patreon is lacking in terms of reporting. The fees are also quite pricey, especially if you upgrade to a higher subscription tier.

Here are all of the areas where Patreon falls short:

Where PayPal Wins

PayPal, by contrast, lets you take payments and donations, but it’s not an all-in-one crowdfunding platform, and you won’t get a creator page. Anyone with a free PayPal business account can accept one-time donations. To accept recurring payments, however, you’ll need to sign up for the Virtual Terminal or a PayPal Payments Pro account. For other crowdfunding features comparable to what Patreon offers, you’ll need to fill the gap with third-party integrations (thankfully, there’s no shortage of those with PayPal).

PayPal is better for nonprofits interested in fundraising and accepting donations through PayPal.

Here’s a quick look at what PayPal does well:

Where PayPal Falls Short

As we mentioned above, setting up recurring payments isn’t PayPal’s strength. If you’re looking for a way to set up memberships, then PayPal isn’t for you.

Here are some other areas where PayPal misses the mark:

Patreon VS PayPal: Pricing Comparison

There are four main types of fees you’ll pay with Patreon and PayPal: Platform fees (charged either as a monthly fee or as a percentage of your total monthly earnings), per-transaction payment processing fees, payout fees (fees charged when you move funds from your creator balance to your bank account), and currency conversion fees (only charged when a payment is sent in a currency other than your own).

Platform Fees

• With Patreon, your platform fee is a percentage of the contributions you earn, and the rate depends on your subscription level. With a Patreon Lite subscription, you’ll pay 5% of your monthly earnings. With a Patreon Pro subscription, the fee is 8%, and with Patreon Premium, it’s 12%. Of course, you’ll get more advanced features and support with pricier subscriptions.
• With PayPal, you won’t pay any platform fee if you just have a standard business account. These accounts allow you to accept one-time contributions, but if you want to be able to take recurring payments, you’ll need to sign up for either a Virtual Terminal or the Payments Pro plan (which includes the Virtual Terminal and other features, but which also charges a slightly higher processing rate than an account using the Virtual Terminal on a standalone basis). Either of these options costs $30/month, with recurring billing itself costing an additional $10/month, meaning you’ll be paying $40/month to accept recurring payments with PayPal.

Payment Processing Fees

• With Patreon, for each payment over $3 you process, you’ll pay 2.9% + $0.30 per transaction, and for payments of $3 or less, you’ll pay 5% + $0.10 per transaction — the lower fixed portion of the fee helps make low-dollar monthly subscriptions more viable.
• With PayPal, determining your processing costs has become much more complicated since the company changed its fee structure in August 2021. If you have a standard business account, you’ll pay $3.49 + $0.49 per transaction — but if you receive lots of small donations and you’re able to sign up for the Micropayments plan (and it’s possible that you won’t be approved), the rate becomes 4.99% + $0.09 per transaction. Now, to accept recurring payments, you’ll need to either a) get the standalone Virtual Terminal, in which case you’ll be paying $2.59 + $0.49 per transaction, or b) sign up for Payments Pro, in which case you’ll pay $2.89 + $0.49 for most transactions and 3.49% per American Express transaction. Furthermore, when receiving payments in a currency other than your own, you’ll pay an additional merchant fee (separate from the currency conversion fees).

Payout Fees

• With Patreon, US creators receiving a payout via direct deposit pay $0.25 per payout. If you’re receiving a payout via PayPal, you’ll pay 1% of the amount transferred with a minimum of $0.25, capped at $20 (you have the option of accepting PayPal payments and receiving payouts via PayPal when using Patreon, though your processing rates and payout fees will be different than they would be if you were using PayPal directly… sorry; it’s complicated).
• With PayPal, receiving a payout will cost you 2% of the total transaction amount, capped at $1 for US transactions and $20 for international transactions. However, this changes if you take payouts through the Payouts API, in which case you’ll pay a flat $0.25 per payout.

Currency Conversion Fees

• Patreon charges creators a 2.5% currency conversion fee on all payments made in a currency other than the creator’s payout currency.
• PayPal charges a 3% to 4% currency conversion fee on all payments made in a currency other than the recipient’s payout currency.

Check out our PayPal pricing article for a complete breakdown of PayPal’s complex fee structure. For more details on Patreon’s subscription plans and fees, see our Patreon review.

Which Is Best For My Business?

If you’re looking to fund your creative business or project by accepting donations or offering subscriptions, Patreon and PayPal can both be used to facilitate earning an income. Here’s the bottom line:

• If you already have a website or blog (or you’re prepared to create one) and you simply want to solicit one-time contributions from your readers and site visitors with a donation button, go with PayPal.
• If you want to accept recurring donations or sell subscriptions to your content and you want an all-in-one platform that helps you handle all aspects of the crowdfunding process, go with Patreon.
• If you want to accept recurring donations or sell subscriptions, you want to keep as much of what you earn as possible, and you and/or your team are prepared to handle the technical work necessary, go with PayPal.

If you specifically want to sell access to your content on an ongoing basis, Patreon is a much more complete crowdfunding solution. If Patreon sounds close to what you’re looking for, but not quite a great fit, check out the best Patreon competitors.

PayPal, on the other hand, is better if you intend to take individual donations on a one-off basis. It’s entirely possible to use PayPal to draw subscription income, too. Just know that it will require more effort on your part, and you may need to hire a developer. And if PayPal is close to what you want, but you’d like to explore competitors, check out the best PayPal alternatives.

If you’ve used either PayPal or Patreon to earn money through donations or subscriptions, we’d love to hear about your experience.