solobuildWhat Paddle actually is
Paddle is a merchant of record built for software companies. Like Lemon Squeezy, it becomes the legal seller to your customer, which means it collects the payment, handles sales tax and VAT around the world, and pays you the rest. Your customer's receipt has Paddle's name on it, not yours.
Paddle has been doing this for software companies longer than most of its rivals. It covers subscriptions, failed-payment recovery, fraud and chargeback handling, and invoicing for business buyers. Its support team also answers your customers' billing questions, which is work you would otherwise do yourself.
What it costs
The standard pay-as-you-go plan charges 5% plus 50 cents per checkout transaction, with no monthly fee. Products priced under $10, and sales that need invoicing rather than card checkout, go through custom pricing arranged on a call.
A few costs do not show up in the headline. Currency conversion spreads are commonly reported in the 1.5% to 2% range on non-USD sales. Refunds return the customer's money but not the original transaction fee, so a product with many refunds costs more than the math suggests. Payouts run on a rolling schedule with a holding period, which is slower than Stripe.
The approval process
This is the part to plan around. Paddle reviews every account by hand before you can sell. A straightforward product typically takes three to seven business days, and anything unusual takes longer.
Founders have reported rejections for reasons that are not documented publicly. Common ones include a legal business name that does not exactly match the name on the website, or no prior history of processing payments. Some builders describe going through two or three rejection cycles with generic feedback in between. Multiple solo sellers have also reported needing a registered business or tax ID to get through.
The practical advice is simple. Make sure your entity name matches your website exactly, have your terms, privacy, and refund pages live, and do not schedule a launch until you are approved.
Where Paddle is strongest
Paddle earns its fee when tax work would otherwise be expensive. If you sell to businesses in a dozen countries, need to send invoices and accept purchase orders, and do not want to answer billing tickets, Paddle hands off a meaningful amount of work. It is also a long-standing company focused only on this job, which makes it a steadier long-term bet than a platform in the middle of being merged.
Where Paddle frustrates
The approval process is the main complaint, followed by the hidden costs above. Paddle is also built for software, so it is not the right tool for selling ebooks, courses, or templates to individual buyers. Creator features like storefronts and file delivery are not its focus.
Who Paddle is for, and who should look elsewhere
Paddle is a strong fit for an established SaaS product with international customers and B2B buyers, where the tax question is large enough to be worth handing off for good.
Look elsewhere if you are launching your first product soon, since Lemon Squeezy or standard Stripe will be faster to set up. If your buyers are mostly in the US, standard Stripe is cheaper. If you sell digital downloads rather than software, a creator platform like Gumroad fits better. Our guide to Stripe vs Lemon Squeezy vs Paddle compares all three at real revenue numbers.
The bottom line
Paddle is the grown-up merchant of record for software. It costs the same headline rate as Lemon Squeezy, asks more of you before it lets you sell, and gives you a more settled platform in return. Budget a week or more for approval, and it can carry your billing for years.