Choosing a Payment Processor for Your Small SaaS Project Without Upfront Banking Requirements

Starting a small-scale SaaS (Software as a Service) venture can be exciting, but selecting the right payment processing solution is crucial, especially when operating as an individual or small team without a formal business entity. If you’re in the early stages of your project and want to keep setup requirements minimal—particularly around banking and Know Your Customer (KYC) procedures—there are several options to consider.

The Challenge of Standard Payment Gateways

Many popular payment processors, such as Stripe and LemonSqueezy, typically require users to connect a bank account during the onboarding process. This requirement can be a hurdle for entrepreneurs testing the waters, especially when:

• The project’s profitability is uncertain.
• You prefer to keep personal and business finances separate only once revenue is more predictable.
• You want to minimize initial setup friction related to tax IDs or detailed KYC procedures.

Looking for a Flexible Payment Gateway

Ideally, you’d like a payment gateway that:

• Supports recurring billing and subscription plans
• Does not mandate connecting a bank account upfront
• Allows adding a bank account later for payouts
• Has a straightforward KYC process, involving only basic document verification
• Does not require complex tax documentation initially

Potential Solutions and Recommendations

While many payment processors are geared toward registered businesses, some options cater to solo entrepreneurs, individuals, or early-stage startups with minimal onboarding complexities:

1. Use Payment Gateways with No Upfront Bank Account Requirement

Some providers permit onboarding without immediate bank linkage, allowing you to accept payments and set up payouts later:

• PayPal: Primarily designed for individual use, PayPal allows you to accept recurring payments and settle funds into your PayPal account. You can link your bank account later for withdrawals, making it a flexible choice for early testing.

• Stripe (with caveats): While Stripe usually requires bank details upfront, some regions and use cases may allow account creation with minimal initial hurdles. You can set up a Stripe account to accept subscriptions and add your bank details subsequently.

• Square: Similar to PayPal, Square allows processing payments and then linking bank accounts later for payouts. Its onboarding process is straightforward and often suitable for small operations.

2. Alternative or Niche Payment Platforms

• Paddle: Focused on SaaS and software businesses, Paddle handles subscriptions and simplifies tax and compliance management. Its