Joshua D'Costa Growth & Marketing Jan 31, 2025 | 5 min
Developers working on a desktop
One of the most prominent names in the payment processor is Stripe, a platform known for its developer-friendly interface and extensive features. However, for SaaS businesses, the easiest way to handle their recurring billing solution is to switch to a Merchant of Records (MoR). A MoR will not only work as a payment processor but will handle chargebacks, legal compliance, tax audits, and much more.
In this blog, we will explore the limitations of Stripe and how a Merchant of Record (MoR) solution is the best Stripe alternative.
Stripe is an American payment processing platform that has gained immense popularity among businesses of all sizes. It offers a wide range of features, including invoicing, subscription billing, and support for over 195 currencies.
However, despite its many advantages, Stripe has several disadvantages that may hinder Micro-SaaS founders and solopreneurs:
Stripe's recent shift to an "invite-only" model in countries like India has restricted access for many potential users.
Stripe primarily serves as a payment gateway, necessitating additional tools for subscriptions, taxes, and invoicing. This can complicate the payment infrastructure for businesses that require a more streamlined solution.
Stripe is only available in 46 countries and it has limited support in several countries, including Germany, Israel, India, Hong Kong etc,. This limitation can restrict market access for businesses looking to expand globally.
Managing sales tax across different jurisdictions is burdensome. Although Stripe has launched Stripe Tax, the tax calculation engine is limited to few countries and merchants still need to register, file, and remit taxes themselves in various regions.
Merchant of Record (MoR) solutions offer a compelling alternative to traditional payment processors. By acting as the intermediary between the business and its customers, MoRs handle all aspects of payment processing, including compliance, tax management, recurring payments, and customer support.
This is especially beneficial for Micro-SaaS founders and solopreneurs who often lack the resources to manage these complexities themselves.
Dodo Payments is an excellent Stripe alternative for Micro-SaaS founders who are looking for a Merchant of Record solution. Manages all aspects of Merchant of Records, Dodo Payments covers everything from simplifying taxes to being a global payment processor.
Localized Payment Options Dodo Payments supports local payment methods allowing businesses to cater to diverse customer bases while providing personalized checkout experiences.
Cross-Border Tax Compliance The platform automates the calculation, collection, and remittance of VAT, GST, and sales taxes in over 190+ countries, ensuring compliance with minimal effort.
Subscription Management It efficiently handles recurring payments with features like automated retries and detailed invoicing, helping minimize involuntary churn.
License Key Provisioning The license key management system helps merchants secure their digital products by generating, managing, and tracking unique license keys.
Paddle is another Merchant of Record option that offers comprehensive tools for subscription management and global tax compliance. It addresses the critical aspects of payment management, covering everything from customer acquisition to renewals and expansions.
Though Stripe is an excellent Payment processing platform, it’s not a complete payment solution. Whereas, a right Merchant of Record will be a game-changer for your MicroSaaS business, taking care of everything from payment processing to ensuring tax compliance under one roof.
If you’re looking to transition away from payment processors like Stripe and ensure your business continues to thrive in 2025, consider Dodo Payments as your go-to Merchant of Record partner.
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Stripe acts as a payments processor/gateway or merchant account provider, while a Merchant of Record is the legal seller on transactions and assumes tax, compliance, refund, and chargeback liability.
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