A choice every founder selling online has to make early, and one that is tedious to reverse.
Using a payment processor directly. You are the seller. Fees are lower. You are responsible for sales tax and VAT wherever your customers are, for invoices, and for disputes.
Using a merchant of record. The provider is the legal seller and resells your product. They collect and remit tax in the countries they cover. Fees are higher, and you depend on their rules about what can be sold and when you are paid.
Questions that decide it for most people:
- Where are your customers? Selling across many countries makes tax the main problem.
- Where is your company? Some providers do not serve some countries.
- What do you sell? Some categories are restricted.
- How much is your time worth against the fee difference?
- Do you need features such as usage billing, seat-based plans or trials?
Reply with what you use, what you pay in fees all-in, and what you would pick if you started today. Please do not treat anything here as tax advice. Check your own situation with an accountant.