Verified Shopify Account

Shopify Payments is a payment service provider that lets you accept payments as soon as you sign up. It provides all the primary payment methods and allows you to receive payments in local currencies, a great way to increase customer conversion.

Shopify Payments integrates with your Shopify store, eliminating the need to enter credentials for third-party payment providers.

However, it is essential to note that Shopify Payments is only available in specific countries and has specific business requirements for each. Additionally, you must activate two-factor authentication on your Shopify account to use Shopify Payments.

Why should I use Shopify Payments?

Shopify Payments is a payment service provider that is easy to integrate into your online store. You can accept all primary payment methods and sell in different local currencies. Moreover, you can translate your store into multiple languages.

If you already have a Shopify account, using Shopify Payments is an intelligent decision as it helps you save costs and makes your life easier.

You won't have to pay any transaction fees using Shopify Payments. Also, it's free to use and integrate with your store, which could save you a lot of money compared to using a third-party payment provider.

Since it's integrated with Shopify, you can track all your transactions and payments in one place. This makes your business operations smoother and more streamlined.

Is Shopify Payment Safe?

Yes, Shopify Payments is a secure payment service provider. Shopify is certified as Level 1 PCI DSS (Payment Card Industry Data Security Standard) compliant, the highest level for merchants processing more than 6 million card transactions annually. All Shopify stores automatically receive PCI compliance.

Additionally, Shopify uses two fraud filters, Card Verification Value (CVV) and Address Verification System (AVS), to provide enhanced fraud analysis indicators. These filters help protect your store from fraudulent payments.

What does Shopify Payments charge?

Here's an overview of the prices of the different Shopify plans available, along with the transaction fees they charge:

• Shopify Starter: $5 + 5% transaction fees
• Basic Shopify: $24 + 2% transaction fees
• Shopify: $69 + 1% transaction fees
• Advanced Shopify: $299 + 0.5% transaction fees
• Shopify Plus: $2,000 + custom (quote-based) transaction fees

You can use Shopify for free for three days as a trial period. You can also choose the Starter Plan and pay only USD 1 monthly for your first three months. After that, the cost will be USD 5 per month.

There are no setup or cancellation fees with Shopify - only the monthly subscription fee. Shopify Payments is free and included with every Shopify subscription plan.

Transaction fees

When you make a sale on Shopify, you need to pay a transaction fee to the platform. However, if you use Shopify Payments as your payment service provider, you won't have to pay any transaction fees. Shopify only charges a transaction fee when you use a third-party payment provider.

It's important to note that this only applies to the Shopify Basic, Shopify, and Advanced Shopify plans. If you're a Shopify Starter member, you'll have to pay a 5% transaction fee regardless of the payment provider you use.

Processing fees

When you use Shopify Payments to process transactions, you will be charged a credit card processing fee per transaction. This fee covers the costs and risks involved in handling the transaction. The amount you'll be charged in processing fees depends on your Shopify subscription plan, the type of card used, and whether it's an international or domestic card.

Additional fees

Shopify allows you to sell products in your customer's local currency. However, when a customer buys something, a currency conversion fee will be charged to you. This fee is the difference between the currency you receive payment in and your payout currency.

If your business is based in the US, you will be charged a currency conversion fee of 1.5% for all international transactions. If your business is based outside the US, the currency conversion fee is 2%.

If you accept credit card payments, you may sometimes experience a chargeback. A chargeback occurs when a customer disputes a charge on their credit card. In such cases, if the bank decides to favor the customer, the disputed funds will be taken from you, and you will be charged a chargeback fee of USD 15.

However, you can appeal against chargebacks. If your appeal is successful, you will receive a refund for the payment and the chargeback fee.

Every paid Shopify plan comes with Shopify POS Lite. This gives you access to a mobile POS system, order and product management, and the ability to build customer profiles.

You can upgrade to Shopify POS Pro if you need more advanced POS features such as inventory management, analytics, and scalability. This upgrade comes with an additional monthly fee of USD 89 per location.

What is the requirement to use Shopify Payments?

Before you can start using Shopify Payments, you must check if it's available in your location and comply with the regional requirements.

If your business is based in the US, you're lucky because Shopify Payments is available nationwide. However, not all types of US businesses are eligible. Some prohibited business types include financial and professional services, intellectual property infringement, regulated or illegal products and services, and unfair, predatory, or deceptive practices.

Once you've confirmed that your business type is eligible, you must ensure that you have an appropriate US-based complete checking account with ACH transfer functionality.

After confirming your eligibility and bank account, you must set up two-factor authentication to use Shopify Payments. Then, you can enter the necessary information about your store, banking, and personal information. Shopify's partners will use this information to verify your personal and business identity.

Pros and cons of Shopify Payments

After discussing all its features, let's compare the pros and cons of Shopify Payments.

Pros

Fraud protection: Utilizing CVV and AVS fraud filters can safeguard your store against payment fraud.

PCI-compliant: Shopify Payments is certified at Level 1 PCI DSS, which makes credit card transactions secure. PCI compliance automatically extends to all Shopify stores.

No transaction fees: When using Shopify Payments as your payment service provider, you can avoid transaction fees and save money compared to third-party payment providers.

Easy to integrate: If you already have an online store on Shopify, incorporating Shopify Payments is simple. It allows you to manage everything from one place.

POS system: All Shopify subscription plans include Shopify POS Lite. This gives you access to fundamental POS capabilities, such as an in-store mobile POS system, order and product management, and the ability to develop customer profiles. Additionally, you can upgrade to more advanced POS features by paying an additional USD 89 per month per location.

Cons

Monthly fees for more advanced plans: Shopify's monthly subscription fees increase for Advanced Shopify and Shopify Plus

Alternatives to Shopify Payments

PayPal

PayPal is a well-known finance company that offers services for businesses to make international payments. Having a PayPal account is widespread worldwide and can be a convenient option. However, checking the PayPal fees before initiating any transaction is essential.

PayPal's business offerings vary slightly from country to country. They provide various services, including payment solutions and invoicing. It's crucial to check the details regarding international transfers. The costs associated with a business account can differ from those incurred when paying privately. While there is no fee to open an account, it doesn't mean that it won't cost anything. The cost could comprise various charges, such as currency conversion and recipient fees.

Despite the additional costs, some PayPal business packages come with various features, and the company name recognition makes it an excellent option to consider. However, knowing the costs before opening a PayPal business account is essential.

Stripe

Stripe is a platform that offers a range of tools for internet businesses in over 25 countries. It allows enterprises to bill customers, accept payments, and set up a marketplace with a global payments platform.

One of the things that customers love about Stripe is that its tools can be used both as they are or customized to suit the specific needs of a business. Add a single line of pre-written code to your website to accept payments or design your payment flow using Stripe's building blocks. Additionally, you can easily add a plug-in to your website or blog.

Most people pay fees for Stripe on a "Pay as you go" basis, meaning you pay a percentage plus a fixed fee for all transactions. However, if you prefer, you can purchase a tailored package that suits your business needs.

Stripe charges a fee of 2.9% + $0.30 for domestic card payments, with an additional 1.5% for international cards. If you require currency conversion, Stripe charges an extra 1% fee if two or more currencies are involved.

Stripe also supports cheaper payment methods, such as local ACH payments. Domestic wire payments are also supported, although they can be more expensive.

2Checkout (Now Verifone)

Verifone, previously known as 2Checkout, offers a variety of payment options to its customers. It has an impressive international reach as it provides 87 currency options in over 200 countries. Moreover, Verifone's support team can assist you in any of 15 languages if you need assistance.

Verifone provides global payments, hosted checkouts, a payment API, shopping carts, and recurring billing. You can either embed the code in your site for a fully integrated payment option or choose a hosted checkout option, where you can use the default options available online.

In the US, the transaction cost for each customer is 3.5% + $0.35 for the smallest subscription package. However, prices can increase quickly if you're dealing with international payments. If your customer is outside the US, you may have to pay an additional 2% cross-border fee for certain countries.

Authorize.net

Authorize.net is a payment gateway partner that has been around since 1996. They offer several ways to accept card payments, including online, on a mobile device, by mail, or by phone if your customer provides their credit card information. You can also use a card reader to accept payments in person. This is an excellent option for online and offline businesses, such as a craft business that sells at fairs and on their website.

Authorize.net is available in the United States, Canada, United Kingdom, Europe, and Australia, making it possible to accept international card payments.