Meet the best payment gateways for Shopify payments
What is Shopify?
Shopify is a popular e-commerce platform that boasts more than 20020,000 users and whose payment gateways process more than $10billion in sales each year. Shopify is a forward thinking e-commerce platform that invests heavily in its development teams and actively promotes user innovation.
Shopify’s e-commerce platform is so successful that in September 2015, Amazon closed its own webstore and migrated customers to Shopify.Recently, Shopify also did away with transaction fees in a move that should attract a significant amount of new business as this is not standard practice at all.
This article will help you compare the best payment gateways for Shopify:
- What is a payment gateway?
- Which payment gateways are compatible with Shopify?
- The best payment gateways for Shopify
- Pros & Cons
- Next Steps: Finding the best payment gateway deals
What is a payment gateway?
A payment gateway is a type of e-commerce software that lets online stores process orders by transferring transactional information to your preferred merchant account provider.
By doing this, the payment gateway effectively authorizes payments between payment portals and the processing bank.
There are two types of payment gateway for Shopify: direct and external gateways. If using a direct payment gateway, then shoppers will be able to complete their purchase on your online store, whereas an external payment gateway will redirect shoppers to an external checkout page. Using an approved Shopify-compatible payment gateway can help to ensure that transactions are processed securely and efficiently.
Payment gateway compatibility with Shopify
Although customers are encouraged to use the Shopify platform in its entirety, the company does not limit functionality if users opt to mix and match components and software. This has led to a the development of a large number of Shopify payment gateways, fully optimised to work with this popular e-commerce platform.
In fact, over seventy different pay systems can run in tandem with a Shopify payment gateway, taking credit from all over the world.
As mentioned above, Shopify payment gateways are either embedded ‘directly’ in the site, or follow a link to an ‘external’ payment gateway service.
Some of the more popular payment gateways for Shopify include:
|Direct Payment Gateways||External Payment Gateways|
The best payment gateways for Shopify
With so many payment gateways for Shopify available, it can be hard to work out which is the right one for your business – do you need a direct or external gateway? Should you side with a large, proven brand or opt for a smaller, cheaper option?
Below, we’ve provided a quick rundown for some of our preferred third-party payment gateways.
If you’re still undecided afterwards, you can complete the form at the top of the page and a member of our team will be in touch to advise on the best possible solutions and deals.
PayPal is a an enormous entity in the payment gateway field.
It offers numerous advantages to e-commerce businesses of all sizes. The foremost of these is brand recognition, which improves consumer confidence in your trustworthiness and site security. Paypal is also simple to use, which can encourage more users to convert as well as save you money thanks to a transparent pricing structure.
Yet, despite these myriad benefits, it may prove a little confusing picking the right PayPal payment gateway for your site as the number of versions available may be confusing to anyone unfamiliar with the intricacies of online payments.
For clarity, we’ve listed those that currently work with Shopify below and defined whether they are direct or external gateways.
|Direct Payment Gateways||External Payment Gateways|
|PayPal Express Checkout||Yes||Yes|
|PayPal Website Payments Pro (UK)||Yes||No|
|PayPal Payflow Link||No||Yes|
|PayPal Payments Advanced||No||Yes|
- PayPal Express Checkout is available as both direct and external payment options, and has the advantage of being free.
- PayPal Advanced is external but can be customised to resemble the rest of your ecommerce platform and will cost £20 pcm.
- PayPal Payflow Link offers financial management tools that link back to your store, as its name suggests.
Worldpay is another giant of the payment gateway industry and is accessible in over 100 countries.
Well-known for their excellent customer service and uptime reliability, Worldpay aim to make online transactions as smooth a process as possible. In excellent news for Shopify store operators, Worldpay transaction rates are based on a sliding scale dependent on turnover, which helps you to cut costs depending on your success.
Setting up a Worldpay account takes only 3 – 5 days – but given that many providers offer a same-day service, this is comparatively slow. However, the payment gateway’s overall quality makes Worldpay worth the wait, especially if you are starting out and don’t need to take payments immediately.
Sage Pay should be a well recognised name for e-commerce vendors in the UK, thanks to its payroll and HR packages. Sage tends to focus on mid-level businesses, but then grew through acquisitions and has over 6m customers worldwide.
Sage Pay’s basic “business” packages are only £15 – £20 pcm, but corporate contracts are negotiated. Either way the transaction fee is low, which is good news! However, you should be aware that setting up a Sage Pay account can take over a month because online stores will require security certification first.
Sage Pay payment gateways offer e-commerce stores fantastic growth potential and so would suit businesses that are expanding rapidly or looking to push on to the next level in the near future.
Sage Pay’s other advantages include ease of use and operation, as well as the potential for integrated accounting.
Shopify Payment Gateway
Opting for Shopify’s own, built-in Payment Gateway will mean that you can hit the ground running and be able to take payments within a matter of hours.
Although named after Shopify, the company actually uses the Stripe payment gateway, Stripe.js, which provides a coding barrier. This means that while the Shopify Payment Gateway acts as a service direct from your site, the card details that the customer enters are sent directly to the Stripe server, circumventing security certification because, the vendor is, in effect, using Stripe’s merchant account.
The Shopify Payment Gateway also offers great flexibility to businesses as it comes with a free card-reader, which allows you to take cards from clients in the real world as well as online.
Using Shopify’s own gateway is a good option for businesses looking for minimum hassle when setting up a payment system for their e-commerce store.
Pros and Cons
The pros and cons of any payment gateway always need to be understood in terms of the best fit for the business that will be using the service.
Very small businesses with little technical expertise and no desire to engage with complex financial regulations will have completely different requirements for a payment gateway when compared to a multinational juggling exchange rates, variable taxes, and large customer volumes.
That said, comparing several different providers can be overwhelming and it is easier if broken down into various categories. Only the business owner can know which of these features matter to them and which are irrelevant.
Pricing structures come in both fixed monthly fees and percentage of sales. Many merchant accounts will employ both these fee structures simultaneously. Larger businesses will get a better deal, due to economies of scale, by investing in a stand-alone merchant account, despite the initial cost of doing so.
Shopify leads the way in customer-orientated solutions, doing a great deal to remove the administrative barriers to running your own business and providing a framework for the purchase of a variety of useful features.
The secret to their success, however, is that they make no assumptions about the customers of their service users, making sure that each vendor is able to give their customers a variety of payment options.
When considering third-party payment gateways for Shopify, it is important to research the potential added costs that may be applicable. For example, using certain Paypal gateways can incur a monthly charge.
Next Steps: Finding the best payment gateway deals
Compare the best payment gateways for your online business with BMA.
We help you to find the best deal from the UK’s top merchant account providers, so that you can partner with the best option for your business – now and in the future.
By comparing prices with BMA, you could save up to 30% off of the cost!