It’s true that a great product is important for the success of any eCommerce business. However, that is not the only criterion. There are several other factors that determine whether the business is successful. Among these factors, a reliable and seamless payment gateway is a significant one
Shopify offers a range of payment gateway options, and understanding how they work is crucial to ensuring that you get paid quickly and securely. This article will walk you through everything you need to know about Shopify’s payment gateways, so you can make the best choice for your online store.
What Is a Payment Gateway?
A payment gateway is a technology that allows customers to pay for goods and services online. It encrypts sensitive payment information (such as credit card details) to ensure that transactions are secure. Shopify integrates with various payment gateways to help store owners process payments easily. Whether you’re selling digital products, physical goods, or services, choosing the right payment gateway is crucial for smooth transactions.
Shopify Payments: The Built-in Option
Shopify Payments is Shopify’s own payment gateway, and it’s integrated directly into the platform. It’s the most straightforward option for Shopify users and offers several benefits.
Pros of Shopify Payments:
- No Transaction Fees: Unlike third-party gateways, Shopify Payments doesn’t charge additional transaction fees. This means you only pay the standard payment processing fees.
- Seamless Integration: Shopify Payments is built into your store, making setup quick and easy. You don’t need to worry about configuring third-party payment processors.
- Multiple Payment Methods: Shopify Payments supports a wide range of payment methods, including credit cards, Apple Pay, Google Pay, and Shopify’s own Buy Now, Pay Later options.
- Faster Payouts: Shopify Payments ensures that your funds are deposited into your bank account faster than some third-party payment providers.
Cons of Shopify Payments:
- Limited Availability: Shopify Payments isn’t available in all countries. If you’re operating in a country where it’s not supported, you’ll need to use a third-party payment gateway.
- Account Holds: Shopify Payments can place holds on your account if your business is flagged for high-risk activities or chargebacks, which can delay payouts.
Third-Party Payment Gateways
If Shopify Payments isn’t an option for you or you prefer to use another payment provider, Shopify also integrates with over 100 third-party payment gateways. These gateways allow you to accept payments from various credit card providers, PayPal, and other local payment systems.
Some popular third-party payment gateways include:
- PayPal: A widely trusted payment option that allows customers to pay with their PayPal accounts or credit/debit cards.
- Stripe: A global payment processor known for its ease of use and flexibility.
- Authorize.Net: A popular gateway for merchants in the United States, offering secure payment processing.
Pros of Third-Party Payment Gateways:
- More Payment Options: Third-party gateways often support more local payment methods and currencies, making them a good choice for international businesses.
- Flexibility: Some third-party payment processors allow you to customize the checkout experience more than Shopify Payments.
Cons of Third-Party Payment Gateways:
- Transaction Fees: Shopify charges an additional transaction fee when you use a third-party payment gateway. These fees can range from 0.5% to 2%, depending on your Shopify plan.
- More Setup Required: You may need to create an account with the third-party provider and configure settings to integrate with Shopify, which can take more time and effort than using Shopify Payments.
- Possible Delays in Payouts: Some third-party gateways have longer payout processing times compared to Shopify Payments, so you may experience delays in receiving funds.
How to Choose the Right Payment Gateway for Your Shopify Store
Choosing the best payment gateway depends on several factors, including your location, the types of products you sell, your customer base, and your business needs. Here are some considerations to keep in mind when choosing a payment gateway:
- Transaction Fees: Shopify Payments eliminates transaction fees, but third-party gateways often have their own fees. Make sure to factor these costs into your decision.
- Payment Methods: Consider the types of payments you want to accept. Shopify Payments supports major credit cards, PayPal, and mobile wallets like Apple Pay and Google Pay. Some third-party gateways may offer additional payment methods.
- Global Reach: If you sell internationally, you might want to choose a gateway that supports multiple currencies and local payment methods.
- Security: Payment gateways must comply with PCI DSS standards to ensure secure transactions. Both Shopify Payments and reputable third-party gateways follow these standards, but it’s always good to verify.
- Customer Experience: A seamless checkout process can improve your customers’ shopping experience. Shopify Payments is fully integrated into your store, which often provides a smoother, faster experience than third-party options.
Setting Up a Payment Gateway on Shopify
Setting up your payment gateway on Shopify is relatively simple. Here’s a basic overview of the process:
- Log into your Shopify account and go to the “Settings” section.
- Click on “Payments” to open the payment setup page.
- If you’re using Shopify Payments, simply enable it and follow the prompts to enter your business information and banking details.
- For third-party gateways, click on “Choose a provider” and select your preferred gateway from the list.
- Follow the setup instructions provided by the payment gateway provider to integrate it with your Shopify store.
Once set up, you can start accepting payments instantly. Shopify’s user-friendly interface makes it easy to test and manage your payment methods.
Conclusion
Choosing the right payment gateway is an essential step in building a successful Shopify store. Whether you opt for Shopify Payments for its simplicity and lower fees or a third-party gateway to access more options, understanding your payment gateway choices ensures you can run your business smoothly and get paid without unnecessary delays. Take the time to evaluate your options, consider your business needs, and make an informed decision that will support your store’s growth.