Melio vs Plastiq: I Stuck with One

Last Updated on February 3, 2024 by Ewen Finser

If you are trying to figure out if Melio or Plastiq is the right payments platform for you, this article is for you!

Payments has been the bane of my existence for as long as I’ve been online. Particularly working with a diverse set of international freelancers, developers, and consultants… it’s just a pain to figure out the best solution.

Then, layer on accepting payments from vendors and partners, and I somehow have 8 different platforms for the specific edge cases that invariably arise.

So, I’m always done to try something new. Hoping it’s the solution to finally solve the payment goose chase.

Melio and Plastiq were not well known entities to me 3+ years ago, but over the last couple years they popped on my radar (probably after another PayPal funds freeze).

In this comparison I’ll share my experience with both & the summary of whether they are legit options.

Main Differences Between Melio and Plastiq

Here’s my high level take on the key differences between Plastiq vs Melio:

• ACH Transfer Fees: Melio offers completely free ACH transfers, whereas Plastiq charges a nominal $0.99 fee per ACH transaction.
• Users: Melio offers unlimited users with no pricing differences, whereas Plastiq only offers up to 3 users free before switching to a premium model ($59/month).
• Pricing Model: Melio and Plastiq both offer their services without a sign-up fee or subscription fee, but Plastiq has a $59 per month plan offering additional features, whereas Melio does not charge monthly fees for its full functionality.
• International Payment Support: Melio supports payments to 55 different countries and allows for International batch payments, whereas Plastiq supports around 50 countries but offers the option to send funds in multiple currencies, giving recipients more flexibility.
• Financing: Plastiq offers a built-in financing option (similar to PayPal Working Capital), while Melio does not offer any sort of financing.

Melio vs Plastiq: A Preliminary Overview

Melio and Plastiq share a common objective: to ease the burden of accounts payable and receivable for businesses. By implementing either of these tools, businesses can save time and money on these oftentimes complex processes.

Both platforms offer similar functionality, allowing users to make and receive payments in various ways, including bank transfers, debit and credit transactions, checks, wire transfers, and ACH. However, there are some key differences between Melio and Plastiq that can influence your business’s choice.

Understanding the Similarities

Looking at the broader picture, Melio and Plastiq are strikingly similar. They both serve as digital payment solutions, facilitating a multitude of payment methods for businesses. The cost of using either tool is also comparable. Neither Melio nor Plastiq charges a signup fee or subscription fee initially (although Plastiq does have paid premium options), making them financially feasible options for businesses of all sizes.

One common issue businesses face is the mismatch between their preferred payment method and that of their suppliers or vendors. Both Melio and Plastiq address this problem by offering a conversion service, which essentially allows businesses to pay in one way and suppliers to receive payment in another.

Pricing & Fee Structure

Pricing is a crucial factor for businesses when choosing a digital payment platform. Both Melio and Plastiq have similar pricing models, with most services being virtually free. However, they both charge a transaction fee for credit card transactions.

Melio’s charge for credit card transactions is 2.9%, which is the exact same as Plastiq.

Plastiq also charges the same fee for debit transactions, a cost that Melio waives. Moreover, Melio allows businesses to decide whether they or their customers will shoulder the transaction fee. In contrast, Plastiq mandates that the customer pays the fee.

My Experience with Melio

I started using Melio in 2021 for simple ACH vendor payments and the signup process was very simple. Easier than PayPal, Stripe, and some other platforms I’ve used.

The interface is clean and straightforward, a marked difference from the “cluttered” feeling of PayPal, for example.

While Melio is gradually expanding their features, I primarily use Melio for sending vendor invoices for ACH transfers as my default option (PayPal) tends to take a considerable chunk in fees, regardless of transfer type.

Things I liked About Melio

Overall, I still use Melio every month for sending out client invoices for US based companies (ACH transfers). That’s saying something!

• Free ACH Transfers: For saving on fees, this is one of my favorite use cases right now for Melio.
• Easy to Use: The app and dashboard are easy to navigate. Less cluttered then PayPal (although less functionality too).
• Lower Fees: Melio really makes money on credit card processing and international payments, but is comparable or better than Plastiq (and many others) in the fee department.
• Now Supports International Payments: When I first started using Melio, they didn’t support international payments. They do now, but with a $20 flat fee. This means you’ll generally see the greatest benefit on large international transfers of $20,000+ (compared to peers).
• QuickBooks Integration: QuickBooks natively supports QuickBooks, so if you already are on QB, using Melio is a fairly simple extension and all of the data syncs nicely on both sides.

My Experience with Plastiq

The signup process was fairly straightforward and not altogether different than my experience with Melio.

That said, one slightly disconcerting note was that my email confirmation link went to my Gmail spam folder right away. This may just be a Gmail thing, but this doesn’t typically happen to me and signing up for new platforms.

The first thing you’ll need to do is all of the standard financial disclosures (know your customer), beneficial ownership, entity details, etc…

From there, the dashboard is fairly simple to navigate. I ended up spending most of my time in the Payments tab.

The Vendor tab is a an easy way to add frequent payees and was similar to Melio’s process here.

The “wallet” area is where you can add credit cards, bank accounts, or financing lines (something that you can apply through via Plastiq.

Things I Liked About Plastiq

All in all, I had a good experience with Plastiq. It’s nothing fancy, Some of the features that stood out to me were:

• Simple Sign Up Process: I was setup in about 10 minutes and ready to send payments to vendors.
• Built-in Short Term Financing: I haven’t actually used their service, but it’s nice to have a one-stop solution if we need. No need to send over statements or additional verification as you are already validated in their system. Reminds me a bit of PayPal Working Capital in this sense.
• Free to use: There are premium plans for additional features, but the core functionality is free.
• Integrations: Plastiq seems to integrate with more third-party platforms, Netsuite, Oracle, Sage Intacct and others.
• Next Day International Wire Transfers: This is a great feature depending on if you current bank has this or not. Also transfers (in general) were a bit faster than Melio (ACH and wires).
• Account Permissions: Plastiq functions similar to Mercury Bank with their extensible user roles and permissions. This isn’t something that Melio has yet. The first 3 users are free, then there’s a pricing plan for additional.

Melio vs Plastiq Fees & Pricing

Melio and Plastiq BOTH have a free tier and Melio never charges a subscription fee. Plastiq DOES have a user-based pricing scale, once you exceed 3 account users (e.g. larger than a small businesses).

Melio makes money off of transaction fees, with the follow schedule:

Plastiq also has a similar pricing schedule, but with these nuances:

As you can see here, the differences are minimal, but Plastiq does charge a nominal ACH fee of $0.99, has slightly lower paper check fees, and a slightly more expensive expedited check / same day payment fee at 0.2%.

My summary of the fees alone is that Melio is slightly less expensive overall and doesn’t have an user-based pricing. Going on fees alone, Melio is the clear winner (but that’s not everything).

Melio vs Plastiq Integrations Compared

Both Melio and Plastiq don’t have a ton of native integrations, but they have added some useful ones.

Melio Integrations:

• QuickBooks
• Xero

Plastiq Integrations:

• QuickBooks
• Xero
• Sage Intacct
• Oracle Netsuite

Plastiq obviously stands out with their Sage and Oracle integrations, making it suitable for a larger enterprises, whereas Melio feels more squarely focused on freelancers and SMBs.

Cross-border Payments

Cross-border payments are another area where Melio and Plastiq diverge. Plastiq supports global payments, allowing businesses to pay for products or services in over 40 countries and more than 20 foreign currencies.

However, Melio recently added a substantial list of global country support, although they still can only send and receive in USD.

Melio and Plastiq Alternatives

The payment space is heating up with some newcomers joining the industry stalwarts. Below are some other competitors I’ve considered and myself or our editorial team have compared:

• Veem: For international payments, Veem has a very cost effective, low fee structure and supports a variety of currencies. It’s a bit more complicated than either Melio or Plastiq, so may be overkill for most SMBs. Veem vs Melio compared.
• PayPal: A necessary evil for me, but it’s hard to beat the universal user base and broad feature-set. I want to use other solutions, but still run a high volume of transactions (revenue and expenses) through PayPal. PayPal vs Melio compared.
• Stripe: For custom, technical checkouts, and subscription invoicing, it’s hard to beat stripe. Probably a very different use case than Melio or Plastiq, but I’ve setup bespoke invoicing before with Stripe. Stripe vs Melio compared.
• Bill.com: Bill is a great option for large enterprises with complex AP rules and requirements. The upside is that Bill.com has a large suite of accounting and finance tools and also integrates widely with other popular tools. Bill.com vs Melio compared.

So Which is Best? Melio or Plastiq?

I really like both of these options for more affordable (than PayPal) payments and invoicing.

That said, I felt that Plastiq is more suitable for larger enterprises (or at least mid sized businesses), while Melio is a great option for sending / receiving invoices with no or low fees.

Personally, I used both, but stuck with Melio because of the free ACH transfers. This ends up being a small, but significant portion of our business every year.

Plastiq was similar, but slightly more expensive (for ACH). For large volume transactions or bigger accounting teams, I can see how Plastiq makes sense tho. Also, if you need any sort of revenue based financing, Plastiq has that built-in, which Melio does not.