Pick / avoid summary (fast)
Skim these triggers to pick a default, then validate with the quick checks and constraints below.
- ✓ You want to offload tax/compliance and be operationally lighter
- ✓ You’re selling digital products globally and want MoR simplicity
- ✓ You have a small team and need fast time-to-market
- ✓ You need mature subscription operations and lifecycle handling
- ✓ Revenue recovery and dunning sophistication matter for your economics
- ✓ You want more control over billing ops, reporting, and workflows
- × Higher transaction fees (5% + payment processing) compared to alternatives
- × Less flexibility - Paddle controls the checkout and payment experience
- × Higher price point compared to some competitors
- × Setup and onboarding can be lengthy for complex implementations
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CheckIf operational overhead is the constraint, MoR wins; if control and recovery tooling are the constraint, Recurly wins.
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CheckConfirm MoR coverage, dunning scope, and reporting needs on official pages.
At-a-glance comparison
Paddle
Paddle takes a unique approach to subscription billing by acting as a merchant of record, handling not just billing but also payments, tax compliance, and fraud prevention. This all-in-one model removes the complexity of global tax compliance and payment processing, allowing businesses to focus on their product. Paddle is particularly popular with software vendors and SaaS startups selling digital products globally, as it handles VAT, sales tax, and other compliance requirements across 200+ countries. The platform provides a complete checkout experience optimized for conversion, with built-in support for multiple payment methods and currencies. While Paddle's merchant of record model means they handle the customer relationship for transactions, this trade-off delivers significant simplification for teams that want to avoid the operational burden of global compliance.
- ✓ Complete merchant of record solution - handle payments, tax, and compliance
- ✓ Eliminates complexity of global tax compliance (VAT, sales tax, GST)
- ✓ Conversion-optimized checkout with localized payment methods
Recurly
Recurly is an enterprise-grade subscription management platform built to handle the most complex billing scenarios while maintaining ease of use. The platform excels at revenue recovery and subscription optimization, with sophisticated algorithms that maximize customer lifetime value. Recurly's strength lies in its ability to handle diverse subscription models, complex proration logic, and multi-tier pricing structures without custom code. The platform provides robust financial tools including automated revenue recognition, comprehensive tax management, and detailed analytics. With a focus on subscription intelligence, Recurly helps businesses understand subscriber behavior, predict churn, and optimize pricing strategies. Its proven track record with enterprise clients makes it a trusted choice for businesses processing significant recurring revenue.
- ✓ Exceptional revenue recovery rates through sophisticated algorithms
- ✓ Handles extremely complex subscription and pricing models
- ✓ Strong financial reporting and revenue recognition capabilities
What breaks first (decision checks)
These checks reflect the common constraints that decide between Paddle and Recurly in this category.
If you only read one section, read this — these are the checks that force redesigns or budget surprises.
- Real trade-off: Paddle’s merchant-of-record model reduces tax/compliance ops but limits control; Recurly gives more subscription ops and recovery depth but leaves you owning payment/tax operations.
- Stripe-coupled speed vs gateway flexibility: Are you committed to one payment processor or do you need multi-gateway support?
- Subscription complexity vs implementation ownership: Do you need usage-based billing, hybrid pricing, or complex proration?
Implementation gotchas
These are the practical downsides teams tend to discover during setup, rollout, or scaling.
Where Paddle surprises teams
- Higher transaction fees (5% + payment processing) compared to alternatives
- Less flexibility - Paddle controls the checkout and payment experience
- Limited customization of billing logic and workflows
Where Recurly surprises teams
- Higher price point compared to some competitors
- Setup and onboarding can be lengthy for complex implementations
- UI feels dated compared to newer platforms
Where each product pulls ahead
These are the distinctive advantages that matter most in this comparison.
Paddle advantages
- ✓ Merchant-of-record model reduces tax/compliance operational burden
- ✓ Fast path to selling globally with fewer internal ops demands
- ✓ Good fit for small teams prioritizing simplicity
Recurly advantages
- ✓ More control over subscription operations and revenue recovery
- ✓ Better fit when dunning and churn reduction are key
- ✓ Enterprise maturity for complex subscription lifecycle needs
Pros and cons
Paddle
Pros
- + Complete merchant of record solution - handle payments, tax, and compliance
- + Eliminates complexity of global tax compliance (VAT, sales tax, GST)
- + Conversion-optimized checkout with localized payment methods
- + Simple pricing model - no hidden fees or setup costs
- + Fast implementation with minimal technical resources
Cons
- − Higher transaction fees (5% + payment processing) compared to alternatives
- − Less flexibility - Paddle controls the checkout and payment experience
- − Limited customization of billing logic and workflows
- − Customer data ownership is shared with Paddle as merchant of record
- − Advanced subscription features less comprehensive than specialized platforms
- − Revenue recognition tools are basic
- − Limited integration with enterprise financial systems
- − Not ideal for businesses requiring full control over customer relationships
- − Reporting capabilities less advanced than dedicated billing platforms
- − B2B quote-to-cash workflows are limited
Recurly
Pros
- + Exceptional revenue recovery rates through sophisticated algorithms
- + Handles extremely complex subscription and pricing models
- + Strong financial reporting and revenue recognition capabilities
- + Excellent multi-currency and global tax compliance
- + Proven enterprise scalability and reliability
Cons
- − Higher price point compared to some competitors
- − Setup and onboarding can be lengthy for complex implementations
- − UI feels dated compared to newer platforms
- − Limited native integrations compared to some competitors
- − Revenue experimentation features less advanced than specialized tools
- − Customer portal customization more limited than some alternatives
- − Some advanced features require custom development
- − Reporting interface could be more intuitive
Keep exploring this category
If you’re close to a decision, the fastest next step is to read 1–2 more head-to-head briefs, then confirm pricing limits in the product detail pages.
FAQ
How do you choose between Paddle and Recurly?
Choosing between Paddle and Recurly depends on your business priorities and technical requirements. Choose Paddle if you're a software vendor wanting merchant-of-record simplicity and tax compliance handled for you. Choose Recurly if you need more sophisticated subscription management, revenue recovery, and financial operations control.
When should you pick Paddle?
Pick Paddle when: You want to offload tax/compliance and be operationally lighter; You’re selling digital products globally and want MoR simplicity; You have a small team and need fast time-to-market; You prefer a bundled approach to checkout, taxes, and payments.
When should you pick Recurly?
Pick Recurly when: You need mature subscription operations and lifecycle handling; Revenue recovery and dunning sophistication matter for your economics; You want more control over billing ops, reporting, and workflows; You can own merchant responsibilities (tax/compliance) yourself.
What’s the real trade-off between Paddle and Recurly?
Paddle’s merchant-of-record model reduces tax/compliance ops but limits control; Recurly gives more subscription ops and recovery depth but leaves you owning payment/tax operations.
What’s the most common mistake buyers make in this comparison?
Choosing MoR for simplicity without accepting control limits, or choosing an ops-heavy platform without planning for tax/compliance ownership.
What’s the fastest elimination rule?
Pick Paddle if you want merchant-of-record simplicity and to offload tax/compliance operations.
What breaks first with Paddle?
Needing full control over the customer payment relationship and billing model (MoR becomes a constraint). Enterprise integrations and workflows (ERP/RevRec) beyond a MoR-first operating model. Pricing/contract complexity that doesn’t fit the platform model cleanly.
What breaks first with Recurly?
Advanced enterprise quote-to-cash needs that require a heavier platform. Complex revenue recognition and financial workflows as finance requirements expand. Process governance when pricing/catalog changes happen frequently across teams.
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Sources & verification
We prefer to link primary references (official pricing, documentation, and public product pages). If links are missing, treat this as a seeded brief until verification is completed.