Choosing the right online payment methods Shopify offers isn’t just about accepting money – it’s about building customer trust, reducing cart abandonment, and ultimately boosting sales.
But with Shopify payment options available, navigating the choices can feel overwhelming. From Shopify’s own integrated solution to various third-party payment gateway Shopify integrations, understanding each can make a significant difference to your bottom line.
This comprehensive guide will walk you through everything you need to know about setting up and optimizing your payment systems. You’ll discover the best online payment methods for Shopify, learn how to set up payments on Shopify, understand the Shopify payment processing fees, and much more.
Understanding Shopify Payments: Your Go-To Option
When you create a Shopify store, the most straightforward and often recommended payment gateway Shopify offers is “Shopify Payments.” This is Shopify’s own integrated payment processing solution, designed to work seamlessly with your store.
What is Shopify Payments?
Shopify Payments acts as an all-in-one payment processor built directly into your Shopify admin. This means you don’t need a separate third-party account (like a PayPal Business account or a Stripe account) to start accepting payments. It simplifies the entire process, from setup to managing transactions and payouts. It automatically allows you to accept major Shopify credit card payments like Visa, Mastercard, American Express, and Discover, along with popular digital wallets.
Pros of Shopify Payments:
- Simplified Setup and Management: Activating it is usually a few clicks within your Shopify admin. All your payment data, orders, and payout information are consolidated in one place, making reconciliation much easier.
- No Additional Transaction Fees: This is a major advantage. If you use Shopify Payments, Shopify does not charge an additional transaction fee (typically 0.5% to 2% depending on your plan) that it charges for sales processed through third-party gateways. You only pay the standard credit card processing fee.
- Integrated Reporting: Get detailed insights into your transactions, payouts, and chargebacks directly from your Shopify dashboard.
- Built-in Fraud Prevention: Shopify Payments comes with integrated fraud analysis tools that help identify and flag potentially risky orders, enhancing your secure online payments Shopify efforts.
- Support for Local Currencies and Payment Types: It often supports local payment methods and currencies based on your store’s location, making it easier to sell internationally.
- Accelerated Checkouts: It automatically integrates with Shop Pay, Shopify’s own accelerated checkout, offering a fast checkout Shopify payments experience.
Exploring Other Popular Online Payment Methods for Shopify
While Shopify Payments is an excellent starting point, diversifying your Shopify payment options with other providers can cater to a wider customer base and offer specific functionalities.
– Third-Party Payment Gateways
Many merchants opt for third-party Shopify payment providers for various reasons, such as serving customers in regions not supported by Shopify Payments, utilizing specific features, or leveraging existing relationships with payment processors.
PayPal:
- Overview: One of the most recognized and widely used online payment solutions globally. Offering Shopify PayPal setup is almost a no-brainer due to its immense brand recognition and customer trust.
- Benefits: High customer familiarity and trust, PayPal Express Checkout offers a fast checkout Shopify payments option without redirecting customers to a new page, excellent for international sales.
Stripe:
- Overview: A highly developer-friendly and flexible payment gateway known for its robust API and global reach. Many businesses in India use Stripe.
- Benefits: Supports a vast array of global payment methods, excellent for subscription services, robust fraud detection tools, and highly customizable checkout experiences.
PayU & Razorpay (Highly Relevant for India):
- Overview: These are dominant payment gateways in India, offering comprehensive solutions tailored for the Indian market. They support various local payment methods like UPI, Net Banking, EMI options, and major credit/debit cards.
- Benefits: Deep integration with Indian banking systems, competitive pricing for local transactions, robust fraud detection specific to India, and excellent for domestic sales.
Amazon Pay:
- Overview: Allows customers to use their Amazon account information (including shipping address and payment method) to complete purchases on your Shopify store.
- Benefits: Leverages customer familiarity and trust with Amazon, leading to a quick and seamless checkout experience, potentially reducing cart abandonment.
– Digital Wallets
Digital wallets are increasingly popular for their speed, convenience, and enhanced security. Integrating these is key for a fast checkout Shopify payments experience.
- Apple Pay: Allows customers to make purchases using their iPhone, iPad, Mac, or Apple Watch with just a touch or glance (Face ID). Extremely fast checkout, high security through tokenization, popular among iOS users.
- Google Pay: Similar to Apple Pay, Google Pay enables quick and secure payments across various Android devices and web browsers. Broad reach across Android devices and Chrome browsers, simple user experience.
- Shop Pay: Shopify’s own accelerated checkout experience. Once a customer saves their details with Shop Pay, they can complete future purchases on any Shopify store in just a few taps. Significantly reduces checkout time, improves conversion rates, excellent for repeat customers.
– Buy Now, Pay Later (BNPL) Services
BNPL services allow customers to pay for their purchases in interest-free installments, typically over a few weeks or months. This is a powerful tool to increase average order value and conversion rates.
- Klarna: Offers flexible payment options, including “Pay in 4” installments or “Pay in 30 days.”
- Affirm: Provides transparent, budget-friendly installment plans.
- Afterpay/Clearpay: Allows customers to pay in four interest-free installments.
- Benefits: Attracts budget-conscious customers, reduces purchase friction for larger items, boosts conversion rates by making purchases more affordable.
Manual Payment Methods
For specific business models or customer preferences, manual payment methods can be useful, though they require more administrative effort.
- Cash on Delivery (COD): Widely used in India, particularly for new customers or those hesitant about online payments. Builds trust, caters to customers without digital payment options.
- Bank Deposits/Transfers: Allows customers to directly deposit money into your bank account. Useful for large B2B orders or custom orders.
- Money Order/Cheque: Less common for e-commerce but can be offered in niche scenarios.
How to Set Up Payment Methods on Your Shopify Store?
Setting up your Shopify accepted payments is a straightforward process within your Shopify admin. Here’s a step-by-step guide:
– Access Payment Settings:
- From your Shopify admin, go to Settings > Payments.
Activating Shopify Payments (If Applicable):
- If you’re eligible and it’s not already set up, you’ll see a prominent option to “Complete account setup” or “Activate Shopify Payments.”
- Click this and follow the prompts:
- Business Details: Enter your business type (sole proprietorship, private limited company, etc.), legal business name, address (e.g., Pimpri-Chinchwad, Maharashtra), and Goods and Services Tax Identification Number (GSTIN) if applicable.
- Personal Details: Provide information for the store owner.
- Bank Account Details: Enter your bank account information where payouts will be deposited.
- Two-Factor Authentication (2FA): Ensure 2FA is enabled for security.
- Once activated, you can customize settings like which specific card types to accept.
Adding Third-Party Providers:
- In the “Payments” section, look for “Third-party providers.”
- Click “Choose provider.”
- You’ll see a list of available gateways. You can search for specific ones like “PayPal,” “Stripe,” “PayU,” or “Razorpay.”
- Click on the desired provider. You’ll either be prompted to:
- Connect an existing account: If you already have an account with that gateway, you’ll be redirected to their site to log in and authorize the connection.
- Create a new account: If you don’t have an account, the link will take you to their signup page.
- Once connected, ensure the gateway is “Activated” in your Shopify settings.
Enabling Digital Wallets & BNPL:
- Digital wallets like Shop Pay, Apple Pay, and Google Pay are often automatically enabled once you activate Shopify Payments.
- For BNPL services (Klarna, Affirm, Afterpay), you’ll typically find them under “Alternative payment methods” or through specific apps in the Shopify App Store. You’ll need to create an account with the BNPL provider and then connect it to your Shopify store.
Setting up Manual Payment Methods:
- Under “Manual payment methods,” you can add options like “Cash on Delivery,” “Bank Deposit,” or “Money Order.”
- Click “Add manual payment method,” give it a name (e.g., “Cash on Delivery – Pay when you receive”), and add payment instructions for your customers.
Testing Your Payment Setup:
- Crucial Step! Before launching, always test your payment methods.
- For Shopify Payments and most third-party gateways, there’s a “test mode” or specific test card numbers you can use to simulate a transaction without real money.
- Place a test order from the customer’s perspective to ensure everything is working correctly from product selection to successful payment.
Conclusion
Choosing and configuring the right online payment methods in Shopify is more than just a technical task; it’s a strategic decision that directly impacts your store’s performance. By thoughtfully selecting and integrating diverse Shopify payment options, you empower your customers with flexibility, build trust through secure transactions, and ultimately, drive more sales.