Shopify Payments Review: What You Need To Know About Shopify’s In-House Payment Processor

Pros

• Predictable flat-rate pricing
• No early termination fee
• All-in-one payments
• Good for eCommerce
• Multicurrency-acceptance

Cons

• Sudden account terminations are possible
• Funding holds are common

What Is Shopify Payments?

Shopify Payments is Shopify’s integrated payment processor. It allows new Shopify merchants to start processing payments almost immediately. Using Shopify Payments means you won’t have to integrate an outside payment provider, nor will you have to pay the per-transaction fee Shopify charges when you use an outside processor.

However, despite its convenience, Shopify Payments has some flaws. Read our full Shopify Payments review to get a sense of the benefits as well as the more common complaints.

Shopify Payments Products & Services

Merchants who sign up for Shopify to sell online can choose to use Shopify’s in-house credit card processor, Shopify Payments. Shopify Payments is made possible through a partnership with Stripe (which provides the back-end processing) and is now available in addition to around 100 alternative third-party gateways (such as PayPal).

Let’s now summarize the products and services on offer from Shopify Payments.

Shopify Payment Processing Features

• Omnichannel Platform: Shopify has evolved from an online-only service to a complete omnichannel package. You can use Shopify’s multiple products and merchant services to set up a site and sell online and in person. You don’t even need to set up a full online shop to sell on Facebook and Instagram.
• Shop Pay: Shop Pay is an accelerated eCommerce checkout solution that you can easily enable when you use Shopify Payments. Shop Pay allows customers to save their payment information for future purchases securely. Then, when customers return to purchase at any Shopify store (including yours), the checkout process goes by much faster, resulting in fewer abandoned carts for you. Read our Shop Pay explainer to learn more.
• Developer Tools: Shopify Payments provides API documentation and step-by-step guides.
• Security Features & PCI Compliance: Shopify Payments is PCI compliant, and there are no additional fees related to compliance. Also, users of Shopify Payments get access to 3D Secure Checkout, which reduces fraudulent purchases by requiring customers to verify their identities.
• Chargeback Management: When you are issued a chargeback, Shopify will compile evidence and send it to the bank on your behalf. Shopify’s fraud analysis features should hopefully reduce the number of chargebacks you have to contest.
• Shopify Shipping: This built-in shipping suite provides tools to calculate real-time shipping rates, buy and print shipping labels, and track your shipments. Shopify Shipping is a somewhat new feature, and it’s free for all Shopify merchant accounts, but it is only available for orders shipped from the US and Canada.
• Checkout Options: Shopify updated the checkout flow experience for the COVID-19 era so that you can offer what you need to stay safe and still sell to your customers. While this feature is technically separate from the payment screen and Shopify Payments specifically, we’ve included these updated features here for your knowledge:
  • Local & Curbside Pickup: Merchants can now allow options in the checkout for picking up orders in-store, curbside, or from any other location. Additionally, notifications on the updated Shopify POS app show when a buyer has arrived for curbside pickup.
  • Local Delivery: In all countries, merchants will soon be able to define their local delivery area by zip code and postal code or by radius. This update also lets you add local delivery fees and minimum order amounts for delivery.

Shopify Payments Hardware & Equipment

• Shopify POS: Shopify’s point of sale system allows you to process in-person transactions on a mobile device or a tablet, and it syncs inventory information between your online and brick-and-mortar stores. Read our full Shopify POS review for more.
• Shopify Card Readers & Accessories: Shopify offers two inexpensive mobile card readers: the Shopify Tap & Chip Reader and the Chipper 2X BT Reader ($49 each). However, if you’re looking for something more robust, Shopify now offers the all-in-one Shopify POS Go. For $399, you’ll get a touchscreen card reader + barcode scanner that actually runs the full Shopify POS app right from the device. The Shopify POS Go strengthens Shopify’s in-person selling capabilities and accepts tap, chip, and magstripe payments.
• Hardware Rentals: Shopify partners with Fello to offer hardware rentals. Available hardware includes tablets, tablet stands, card readers, barcode scanners, cash drawers, and receipt printers.

While using Shopify Payments for payment processing is very convenient for Shopify merchants, it has some drawbacks. The biggest shortcoming is the inherent account instability that comes with a payment service provider (PSP). PayPal, Square, Shopify Payments, and Stripe are all PSPs.

Also called third-party processors or aggregators, PSPs accept merchants before officially reviewing them for eligibility. Later, when these PSPs do review merchants and find them ineligible (high-risk merchants are generally ineligible), they place holds on funds and even terminate non-compliant accounts without warning. The best way to avoid this risk is to study a PSP’s terms of service and acceptable use policy before signing up.

That said, Shopify Payments is a very solid option for Shopify merchants who want a convenient omnichannel platform with room to grow — including accepting international currencies with automatic currency conversion. Read our article on how to use Shopify for a deeper look at exactly how Shopify works.

Fees & Rates

There are two main financial advantages to using Shopify Payments in conjunction with Shopify:

1. No Shopify Transaction Fee: Shopify will waive the 0.5%-2.0% commission it would otherwise charge on each of your sales. Plus, if you use Shopify Payments, you can also use PayPal Express without incurring Shopify’s transaction fees. Depending on which option your customer uses to check out, you’ll just pay the Shopify Payments or PayPal transaction fees.
2. Discounted Payment Processing: Most flat-rate credit card processors charge 2.9% + $0.30 per eCommerce sale. Shopify Payments charges this standard processing rate for users on the Lite and Basic subscriptions. However, Shopify’s credit card processing rate decreases for users on the Shopify ($79/month) and Shopify Advanced ($299/month) plans.

For your reference, here’s a breakdown of the four main eCommerce plans Shopify offers:

Shopify Plus (Enterprise)

Merchants earning over a million eCommerce dollars per year are eligible for the Shopify Plus enterprise plan. While the standard rate for Shopify Plus is $2,000/month, rates are negotiable, so you’ll need to contact Shopify for special pricing. Check out our full review of Shopify Plus for more information.

Additional Fees

Like all payment processors, Shopify Payments charges a flat-rate fee for each chargeback that customers issue. The amount of this fee varies by country. In the US, it’s $15, which is the industry average (see Shopify’s list of chargeback fees). Shopify states that if the chargeback resolves in your favor, you get this chargeback fee refunded to you.

Except for the chargeback fee, Shopify does not charge any additional monthly fees, payment security fees, hidden fees, or setup fees on its payments service. Read our complete Shopify fees and pricing guide for an even more in-depth look at Shopify pricing.

Sales & Advertising Transparency

Shopify Payments does a great job in terms of sales and advertising transparency. You’ll find all pricing information for rates and fees clearly on the website, and users haven’t reported any bait-and-switch tactics or shady sales gimmicks listed online.

Contract Length & Early Termination Fee

With Shopify Payments, there are no long-term contracts to sign. You pay per transaction, and you can cancel at any time. Since there is no contract, there is no early termination fee (ETF).

Like other merchant account providers, Shopify Payments can terminate your account if you violate its Terms of Service (read Shopify’s Prohibited Businesses section before getting started with Shopify). However, if it does terminate your Shopify Payments account, that does not necessarily mean your online store account will be terminated as well.

The Shopify Payments Terms of Service (for US merchants) states: “Termination of this Agreement will not necessarily terminate your Shopify Platform Terms unless Shopify determines otherwise.”

If your Shopify Payments account is terminated but not your Shopify store, you’ll have to pay Shopify’s 0.5%-2.0% transaction fee when you find another processor.

Customer Service & Technical Support

Shopify keeps its customer service and technical support in-house, including support for Shopify Payments. You can contact support 24/7 via phone, live chat, or email. Here’s a quick breakdown of Shopify Payments’ support options:

• Phone Support & Live Chat: Shopify offers both live chat and phone support, which will help you contact a Shopify representative with general knowledge. They may escalate your issue to the Shopify Billing department, which will respond via email.
• Online Knowledgebase: Shopify has dedicated an entire section of its knowledgebase to payments. You can find answers to many of your questions within these resources. Having used this database to look for help with a question I had, I found my answer in only a few seconds.
• Email Support: Reach Shopify gurus or the Shopify Billing department via email.
• User Forum: Shopify has an active user forum. Use this forum to ask questions to fellow merchants. Occasionally, Shopify representatives also respond to questions on the forum.

Reviews are mixed on the quality of Shopify’s customer service. Some users have excellent experiences, while others do not. That said, we have found Shopify representatives to be informed and prompt in their responses, and the knowledgebase is robust.

User Reviews

We at Merchant Maverick read as many user reviews as possible when researching a payment processor. The challenge with Shopify Payments is that while reviews of Shopify are plentiful, reviews of Shopify Payments, in particular, are much rarer. For this reason, and because you’ll be using Shopify Payments with Shopify, we’re providing reviews for the Shopify platform as a whole.

Here’s what users think on some of the major consumer review sites:

• G2 Consumer Reviews: 4.4/5 stars with 4,199 reviewers
• Better Business Bureau: A+ rating from the BBB with a 1.11/5-star rating from 87 customer reviews (Keep in mind that BBB users typically come with complaints in mind!)
• Apple Store: 4.5/5 stars with 8,600 reviews
• Capterra: 4.5/5 stars with 5,877 reviews

Negative Shopify Payments Reviews & Complaints

Here are some of the issues we spotted among negative reviews:

• Ineligibility: Some merchants complain that they are not eligible for Shopify Payments. For some, this is because Shopify Payments is unavailable in their country. In other cases, Shopify has revoked payment services because the business was deemed “high-risk.”
• Shopify Holds Funds: Merchants frequently complain about their funds being withheld in reserve, but this is standard practice if an account has an elevated chargeback risk.
• Add-Ons Can Increase Costs: Some merchants have noted that they needed additional apps to get the functionality they required from their Shopify store and that this can quickly drive your costs higher.
• Not As Flexible As Some Solutions: Some users have noted what one Capterra reviewer has picked up on: “Shopify is not nearly as flexible as something like WooCommerce or Magento because you don’t have access to the server’s back-end code or the database.” However, while this will negatively impact a small proportion of sellers, most merchants will benefit from not having to be in charge of maintaining the server and database.

Make sure you read the Terms of Service for every solution you sign up with, including Shopify and Shopify Payments. It could save you a world of pain.

Positive Shopify Payments Reviews & Testimonials

Customers choose Shopify Payments for many reasons, and among the major review sites, positive reviews comprise the majority. Praise for Shopify includes:

• No Shopify Transaction Fees: While there will always be processing fees when you use Shopify Payments, you no longer have to pay the extra 0.5%-2.0% Shopify transaction fee associated with your Shopify plan.
• Potentially Lower Processing Fees: Higher-level Shopify merchants benefit from lower rates. You may find that Shopify’s credit card processing fees are competitive with other major processors.
• Ease Of Use: Customers like how easy it is to take payments. No technical skills (e.g., coding) are needed to get an eCommerce site up and start selling. You won’t need developers to connect with Shopify Payments, and payment management seamlessly integrates into your admin panel.

Final Verdict

Shopify Payments, and the Shopify eCommerce platform as a whole, is a top-notch solution that suits a wide variety of eCommerce businesses, which is why we’re giving it 4.5 out of 5 stars. However, it’s not for everybody.

While it doesn’t happen to the vast majority of accounts, we’ve read enough reports of merchants getting their accounts terminated by Shopify Payments to know that it does happen. If you have any doubt about whether your business qualifies, speak with the risk department directly before signing up. It’s better to be completely honest about your business from the get-go than to fudge the details and hope it will all work out (it won’t).

For most merchants, Shopify offers outstanding value. The platform allows for a lot of flexibility and provides even more cost-efficiency when it comes time to scale up. You’ll have all the tools you need to start selling on your site or outside marketplaces and social media channels. If you decide that Shopify is for you, our guide on selling through Shopify will help you get started.

There are great benefits to having integrated payments, and if your store follows all the rules, Shopify Payments could be the best choice for your store. If not, check out our post on the top Shopify alternatives for more options!

The Merchant Maverick Seal of Approval 🏆

Shopify Payments	Visit Site

After hours of in-depth research and evaluation, we can confidently recommend this brand to our readers. Get started today and see Shopify Payments for yourself.

The Merchant Maverick Seal of Approval 🏆

Shopify Payments	Visit Site

After hours of in-depth research and evaluation, we can confidently recommend this brand to our readers. Get started today and see Shopify Payments for yourself.

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