Shopify Payments: What you need to know about the payment gateway of the Shopify e-commerce platform

Are you an online merchant or owner of a Shopify shop and came across Shopify Payments while searching for the right payment provider? Now you're wondering what the term means and which payment methods are supported?

I'll show you exactly that in a moment.

Best of all, with the help of my instructions, you'll have no more problems setting up and configuring the payment gateway by the end of this blog post.

Let's get started right away.

Definition: What is Shopify Payments?

Shopify Payments is Shopify's official payment gateway, which can be used by many of its online shop customers and merchants. It fully integrates with your Shopify shop and allows you to manage all payment matters from one dashboard using its features.

Previously, German and Austrian online shop operators had to do several things to accept payments:

1. Enter credentials: they had to enter their own credentials into Shopify.
2. Create merchant account: Alternatively, they had to set up a special merchant account.
3. Third-party payment solution: Or they had to integrate at least one third-party payment solution such as PayPal.

With Shopify Payments, there is now a simpler and standardised solution. This enables operators to process all payments reliably and securely directly via Shopify. Customers can pay with various payment methods:

• Credit cards (Visa, Mastercard, American Express, Maestro)
• Debit cards
• Apple Pay and Google Pay
• Shop Pay
• Instant bank transfer
• Klarna: purchase on account
• EPS bank transfer (especially in Austria)
• Bancontact
• iDEAL

I'll now show you how to set up the payment gateway.

Step-by-step instructions: Set up Shopify Payments

 

 

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After setting up Shopify Payments, your customers can pay with the activated payment methods in your online shop.

Approval processes for payment methods

Before you can use the various payment methods, some of them require approval. The approval processes for credit cards and local payment methods start automatically after Shopify Payments is activated.

Configure Shopify Payments

After setting up the payment gateway, you have various options for configuring Shopify Payments.

You can

• set up payout notifications and fraud prevention,
• edit your bank information and customer statements,
• update the tax details,
• Download invoices for your tax return and
• confirm your identity.

Now let's look at the countries where Shopify Payments is currently available.

In which countries can Shopify Payments be used?

Shopify Payments is currently available in the following countries. However, this does not limit the online shop reach, as the integration of external third-party providers is possible in other countries.

Supported countries & regions 2024

If you can't find the country you want in this list, you can check which other payment gateways are supported by Shopify here.

Which payment methods does Shopify Payments include?

Many of the payment providers available from Shopify Payments are very popular. However, they may vary by country and region.

Klarna: Purchase on account

Purchase on account is one of the most popular payment methods among German-speaking companies and customers in the D-A-CH region - especially in Germany.

Sofortüberweisung

Customers often use the payment method Sofortüberweisung (Sofort GmbH/Klarna) for their payments in Germany. To complete the payment process for their online purchase, customers use their online banking access data.

Credit card payments: VISA, Maestro, MasterCard and American Express

Online purchases in Germany are rarely paid for with a credit card. This is quite different from Austria, where it is right behind the most popular payment method.

Bank transfer with eps (Austria)

The eps bank transfer from Austria is similar to the instant bank transfer. Although buyers make their payment using their own access data in online banking, no sensitive buyer data is forwarded.

Google Pay and Apple Pay

In the D-A-CH region, the payment methods Google Pay and Apple Pay are currently not used frequently, as they play a minor role compared to other payment methods. Nevertheless, the use of these strong brands has a positive effect on online shops due to their appeal.

Debit cards

Debit cards, also known as ATM cards in Austria, are one of the most popular forms of cashless payment. They enable both in-store payments and online purchases. In contrast to credit cards, the amount is debited immediately from the current account. Modern debit cards such as the Debit Mastercard offer additional functions such as contactless payment and worldwide acceptance. In Germany, the national debit card system is known as girocard.

Bancontact

Bancontact is the leading electronic payment method in Belgium. Over 80% of Belgian online shops offer this payment option. Customers can use it to make direct online transfers from their bank account. Bancontact is fast, secure and widely used, with over 15 million cardholders. It enables merchants to receive payments within about 10 minutes.

iDEAL

iDEAL is an online payment system from the Netherlands that has been in existence since 2005. It allows customers to make direct transfers from their bank account, similar to Sofortüberweisung in Germany. iDEAL is widely used in the Netherlands and is also offered by some international merchants who have many Dutch customers. The system is based on online banking and is particularly popular as it is a secure and familiar payment method for Dutch consumers.

Shop Pay

Shopify Pay is Shopify's own payment method. With Shop Pay, regular customers can speed up their checkout process in a Shopify online shop.

So that regular customers do not have to enter their payment information such as email address, credit card number and shipping information again and again in the checkout of a Shopify shop, this information is saved beforehand with the wizard.

Tip: For some payment methods such as Shop Pay or PayPal, dynamic checkout buttons can be placed on the individual product pages.

By clicking on the buttons, online shoppers skip the shop's shopping basket.

If you want to know how much it will cost you to use Shopify Payments, read on.

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Shopify Payments fees

Shopify users usually have to pay transaction fees for payments via external payment gateways in addition to the payment provider fees.

These are:

• 2 % for Shopify Lite and Basic Shopify
• 1 % for Shopify and
• 0.5 % for Advanced Shopify

By using Shopify Payments, these transaction fees do not apply.

After activating the payment gateway, the following fees apply (the transaction fees are cancelled):

Additional fees:

Shop operators are charged a fee of 15 euros for every chargeback. This may sound like a lot at first, but such fees are in line with the usual industry standard.

If you are interested in the general costs of the various Shopify plans, then I can highly recommend our article Shopify costs.

Throughout this article, you've probably already noticed some of the benefits of Shopify's payment solution - but there are more.

Advantages of Shopify Payments

The elimination of transaction fees is admittedly one of the most frequently mentioned advantages of Shopify Payments.

Shopify Payments is also easy to install and can be configured in just a few steps (more on this later). The commissions are transparent, so there are no unwanted surprises when payments are received.

However, using the Shopify solution when setting up your Shopify online shop offers you even more advantages.

Guaranteed security from Shopify

Shopify Payments comes from an established and reputable company that has the full trust of its users

Use of additional payment gateways possible

In addition to this payment gateway, Shopify users can also install other third-party gateways such as Stripe or PayPal, as Shopify Payments is compatible with them.

Support for Shopify POS (point of sale) payments

If you use the Shopify POS payment gateway in your shops, you can also use Shopify Payments. You should first activate credit card payments.

Real-time money tracking

From the Shopify admin panel (dashboard), you can access the real-time money tracking system to keep an eye on your online shop's finances.

Multi-currency

If you operate internationally with your Shopify online shop, you can use Shopify Payments to offer your products in the respective local currency. As a result, your customers can pay in their usual currency.

Otherwise, you can set up a separate storefront for each desired currency.

Let's now take a look at the negative aspects of the payment gateway.

Disadvantages of Shopify Payments

If you opt for Shopify Payments, the advantages outweigh the disadvantages, but there are still some drawbacks.

Unauthorised companies

There may be restrictions at country level for certain products, services and industries.

These include

• Financial service providers
• Gambling providers
• illegal shops
• Adult entertainment

High chargeback fees

As you have already learnt, a fee of 15 euros is charged for every chargeback. With a high transaction volume, this can add up to a considerable sum.

Not available worldwide

The payment gateway is not yet accepted in all countries. However, the list of countries is getting longer and longer.

Next, I'll show you how to set up the Shopify payment gateway.

Advantages and disadvantages at a glance

Security with Shopify Payments

The security of payments is of the utmost importance for merchants and their customers. Shopify Payments offers a robust security system that goes far beyond the mere processing of transactions.

PCI DSS compliance

Shopify Payments is fully PCI-DSS (Payment Card Industry Data Security Standard) compliant. This means that all credit card data is processed and protected according to the highest industry standards. As a shop operator, you don't have to worry about the complex requirements of PCI compliance - Shopify takes care of this for you.

3D Secure 2.0

For additional protection against credit card fraud, Shopify Payments implements 3D Secure 2.0. This technology enables additional verification of the cardholder during the checkout process without unnecessarily slowing down the checkout process.

Fraud Analysis

Shopify Payments uses advanced fraud detection algorithms. The system analyses every transaction in real time for suspicious patterns. Various factors are taken into account, such as

• Matching billing and shipping address
• IP address of the buyer
• Order history
• Unusual purchase patterns

If fraudulent activity is suspected, the transaction is automatically flagged for manual review or declined.

Data encryption

All sensitive data transmitted via Shopify Payments is secured with SSL/TLS encryption. This applies to the transmission between the customer and the Shopify server as well as to the communication between Shopify and the financial institutions.

Two-factor authentication

For access to the Shopify admin panel, where sensitive payment information can be viewed, Shopify offers two-factor authentication. This adds an extra layer of security and protects against unauthorised access, even if the password has been compromised.

Regular security audits

Shopify conducts regular security audits and penetration tests to identify and fix potential vulnerabilities in the system before they can be exploited.

Data protection compliance

Shopify Payments is GDPR compliant and thus fulfils the strict European data protection standards. This is particularly important for merchants serving customers in the EU.

Transparency in the event of security incidents

In the unlikely event of a security incident, Shopify has clear protocols in place for notifying affected online merchants and customers and for quickly resolving the issue.

Through these comprehensive security measures, Shopify Payments offers not just a payment gateway, but a holistic security system. This makes it one of the most secure online payment solutions. This allows merchants to focus on their core business while being confident that their transactions and customer data are protected in the best possible way.

Conclusion: What you've learnt about Shopify Payments

In this comprehensive guide, you've gained an in-depth insight into Shopify Payments, the official payment gateway from Shopify. We have highlighted the most important aspects:

• Shopify Payments is an integrated solution that simplifies payment processing for Shopify users and eliminates transaction fees.
• It supports a variety of payment methods, from credit cards to local payment options and digital wallets.
• Availability spans numerous countries, with support growing steadily.
• The fee structure is transparent and varies depending on the Shopify plan chosen.
• Key benefits include ease of installation, compatibility with other gateways, POS support and multi-currency capabilities.
• Disadvantages such as restrictions for certain industries and high chargeback fees should be considered.
• Setup is straightforward and is facilitated by a step-by-step guide.
• Shopify Payments offers a robust security system with PCI-DSS compliance, fraud analysis and data encryption.

As you can see, Shopify Payments is a powerful, secure and user-friendly payment solution for Shopify users. It offers seamless integration into the Shopify platform and covers most payment needs. Despite some limitations, the benefits clearly outweigh the drawbacks for most online merchants.

With the knowledge gained from this article, you are now well equipped to integrate Shopify Payments into your online shop.