Etsy vs. Gumroad vs. Direct: The Platform Fee Math for Digital Products

Sell a $29 digital product on Etsy, and you keep about $25.79. On Gumroad, $26.10. Go direct with Stripe, $27.86.

The $2 difference per sale doesn't move the needle at small volume. At 500 sales, it's $1,000. At 2,000 sales, it's $4,000. Whether that matters depends on which platform is sending you buyers.

Here's the fee breakdown, and what the numbers miss.

The fee structures

Etsy

Every digital product sale on Etsy has three guaranteed line items:

• $0.20 listing fee per item
• 6.5% transaction fee on the sale price
• 3% + $0.25 payment processing fee

On a $29 product, those three add up to $3.21 — about 11% of the sale.

The fourth line item is conditional: a 12–15% offsite ads fee on sales that come through Etsy's advertising network (Google, Facebook, Pinterest, Bing). It only applies when a buyer found your listing through one of those ads. Sellers under $10,000/year in Etsy revenue can opt out. Above that threshold, it's mandatory. Many sellers don't realize this fee exists until they see it on a transaction statement.

Gumroad

Gumroad charges a flat 10% per sale, which includes payment processing. No monthly fee. On a $29 product, you pay $2.90 and net $26.10.

Payhip

Payhip's free tier charges 5% per sale plus standard Stripe processing (2.9% + $0.30). On $29: $1.45 + $0.84 + $0.30 = $2.59, netting $26.41. Marginally better than Gumroad, but there's no marketplace discovery — you're driving all your own traffic.

Direct (Stripe checkout)

Build your own checkout and you pay only payment processing: 2.9% + $0.30 per transaction. On $29, that's $1.14, netting $27.86. Best margin, zero built-in discovery.

Fee math at three price points

| Price | Etsy | Gumroad | Payhip (free) | Direct (Stripe) | |-------|------|---------|---------------|-----------------| | $9 | $1.31 (15%) | $0.90 (10%) | $1.01 (11%) | $0.56 (6%) | | $29 | $3.21 (11%) | $2.90 (10%) | $2.59 (9%) | $1.14 (4%) | | $97 | $9.67 (10%) | $9.70 (10%) | $7.96 (8%) | $3.11 (3%) |

Etsy's fee structure is punishing at lower price points. The fixed $0.20 listing fee and $0.25 processing charge hurt on a $9 sale in ways they don't on a $29 or $97 one. At higher price points, Etsy and Gumroad converge — the meaningful gap is between any marketplace and going direct.

What the fees don't measure

The table makes direct checkout look like the obvious choice. It isn't a complete picture.

Etsy has 90 million active buyers searching for products. If your digital product has clear search demand ("budget spreadsheet," "freelancer invoice template," "1099 tax tracker"), Etsy's marketplace drives sales without requiring ad spend or an existing audience. That inbound traffic has real value the fee table can't quantify.

Gumroad and Payhip don't have that kind of discovery engine. You're getting slightly better margins on sales you still have to generate yourself.

Direct checkout makes sense when you've already solved the traffic problem. For most people launching a digital product for the first time, it's not a starting point.

The 1099-K rules in 2026

Payment platforms are required to send you — and the IRS — a Form 1099-K when your gross sales exceed certain thresholds.

For 2025 income: the threshold is $5,000 on a single platform. For 2026 income (reported in early 2027): that threshold drops to $2,500.

The key word is gross. The 1099-K reports total sales before fees. If Etsy reports $5,000 and you paid $550 in fees, your taxable income is $4,450 — but the IRS sees $5,000 on the form. Your own records are what bring that number down at tax time.

If you're selling across multiple platforms, you're reconciling this across several dashboards simultaneously. A spreadsheet logging monthly gross revenue and fees paid per platform takes 20 minutes to build and saves a messy scramble in Q4.

Which platform makes sense to start on

For most people launching a digital product: Etsy or Gumroad, depending on whether there's search demand on a marketplace.

If buyers actively search Etsy for what you're selling, list there. The fee premium is paying for discovery that would otherwise require ad spend you may not have yet.

If your product needs context to land or doesn't fit the Etsy browsing pattern, Gumroad is a clean option. You'll drive your own traffic, but the setup is fast and the fee structure is transparent.

Direct checkout is the long-game move once the audience exists and the margin difference is worth the infrastructure. Not the right starting position.

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If you're selling on multiple platforms and want a clean way to track gross per source, fees paid, and net income by quarter, the 1099 Money System handles that alongside expense tracking and quarterly tax estimates.

For informational purposes only. Not financial, tax, or legal advice.