Lago

Stripe Billing bundles recurring subscriptions directly into its proprietary processing ecosystem, locking usage calculations to its hosted ledger and fee schedules. Lago decouples event metering and rating logic from payment rails, giving developers a self-hosted engine to manage consumption models on their own servers. This architecture lets teams route transactions through any payment gateway while keeping customer usage data internal.

Why Lago instead of Stripe

Stripe Billing handles standard recurring tiers cleanly, but engineering workflows strain once pricing depends on high-volume consumption. Ingesting millions of telemetry events or compute minutes into Stripe creates tight coupling with proprietary rate limits and rigid charge intervals. Lago shifts that metering workflow into your own stack. Services push raw consumption events into Lago through an API or client SDKs, where an internal aggregation engine computes billable units across dimensions like sum, maximum, or unique counts. Once invoices finalize, Lago orchestrates payment collection through Stripe, Adyen, or GoCardless, treating the processor as a settlement endpoint rather than the owner of your pricing logic.

The trade-off centers on operational responsibility versus architectural autonomy. Stripe operates as a closed cloud that absorbs gateway failures and collects processing cuts on every invoice. Lago requires running a Go backend with PostgreSQL and Redis, meaning ops leads must maintain infrastructure reliability, backups, and queue capacity during usage spikes. Decoupling billing logic from payment processing avoids vendor lock-in and eliminates revenue-share fees as transaction volume expands. For teams also evaluating Merchant of Record providers like Paddle or 2Checkout, Lago offers a different model: it provides no sales tax remittance or legal merchant entity, leaving tax automation and merchant accounts in your hands.

What it does well

• High-throughput event ingestion: Ingests and aggregates telemetry events without per-event SaaS charges, keeping infrastructure costs predictable as client workloads expand.
• Flexible pricing configuration: Operators design tiered, graduated, package, or hybrid plans through an admin dashboard without changing application database schemas.
• Payment gateway independence: Routes finalized invoices to Stripe, Adyen, or GoCardless, enabling ops leads to add regional payment providers without rewriting core billing code.