There’s no way around it – choosing a payment gateway for any eCommerce business is a pain. It turns out accepting card payments online isn’t as simple as you would like – and things only get more complicated when you throw offline sales into the mix.
Then you have the sheer number of providers to choose from, most of which are known for crappy contracts, hidden fees and woeful customer service.
Sounds good, right? Well not according to the guys over at Shopify. The Canadian firm that built its own eCommerce platform – because the rest weren’t good enough – returned to develop Shopify Payments in 2013. The aim is to take the pain out of accepting online payments and dealing with the usual crop of providers. So how does it compare to the other payment gateway options?
Shopify Payments features
Shopify Payments isn’t a fully-fledged merchant account service. What that means is it doesn’t process the payments itself. A firm called Stripe handles that side of things and you can find an impartial review here.
A quick note on payment service reviews: it’s tricky to find reviews that really highlight the flaws of providers. Merchant Maverick, which wrote the review I just linked to, is pretty good at this. Never trust a review that only says good things about a payment provider.
So, instead of processing payments, Shopify plays the role of payment gateway – essentially the interface for managing everything. And there are three main types of payment you can accept:
- Process card payments online
- In-store card payments with Shopify POS
- Shopify Mobile for accepting payments on the go
These options are fairly typical of any modern payment processor. Once again, it’s Stripe handling the payments; Shopify provides the software and hardware you’ll be using. There are some notable features in that software, too:
- Payment dashboard to manage transactions
- Repeat payments for subscription services, incremental payments, etc.
- Email notifications when new funds reach your bank account
- Pending section to quickly view transactions where funds haven’t yet reached your account
- Tax reporting
That’s a healthy set of features for a wide range of business types. The main downside at this stage is Shopify Payments is only supported in Canada, the US, Australia and the UK.
Shopify users from other countries will have to explore other options for now. If that’s the case (or you’re not using Shopify) then I would suggest checking out Braintree.
Contracts and fees
Since Shopify Payments first hit the scene, various new platforms have emerged to provide a similar service. These firms are a huge step away from having a merchant account through a bank.
A key difference is you don’t have to sign any contracts. This is huge because the vast majority of complaints about providers stem from lengthy contracts, cancellation fees switching to another provider.
Instead, Shopify comes with a monthly subscription fee and the freedom to cancel whenever you choose. This has become more common with the rise of specialist online payment gateways. The likes of PayPal and Braintree are among the other contract-free providers.
One niggle with Shopify is you have to pay a transaction fee on every payment. The good news is you can wipe those fees away by using Shopify Payments as your gateway. Instead, you’re only paying the percentage fee based on each transaction.
Getting set up
Aside from the whole contracts and fees issues that come with many providers, the setup process can be a chore. This is especially true with those pesky banks. You have to hand over basically every detail of your business and more personal information than you would like. And then you get the joy of waiting around while they decide whether or not you deserve an account.
The real killer is you often end up getting labelled as a ‘high-risk’ company. Sometimes this means you get refused outright; other times you get hit with sneaky fees. This is a serious problem with going through banks.
Thankfully, the digital breed of payment gateway providers are much easier to set up. Shopify Payments has you up and running in a matter of minutes, ready to sell products right away. The same can be said for PayPal, Braintree and a select few other providers. It’s just a shame more of them don’t follow suit.
If you run into any problems with Shopify Payments, you’ll be glad to know you’re in good hands. This is one area Shopify really gets right, regardless of which services you sign up to. Which also happens to be an area most payment providers fail horrendously in.
Just check out the comments (aka complaints) section of Merchant Maverick or Card Payment Options reviews. They make for pretty scary reading. I often wonder if payment providers are actually trying to piss off every business owner they can.
Back to Shopify, you get 24/7 phone, email and live chat support for anything urgent. You also have an extensive collection of resources for less pressing issues:
This is pretty important considering the generally poor service from payemnt firms. Again, Paypal and Braintree are an improvement but Shopify beats them both in terms of customer care.
So how does Shopify Payments weigh up?
If you’re running a Shopify store then Shopify Payments is definitely an optin you want to explore. Not only does it waver the transaction fee you’ll otherwise have to pay – it walks all over traditional payment providers.
Much of this comes down to the Stripe collaboration and how they handle payments. Where Shopify takes control is by offering a smooth payment gateway that’s designed to close more sales. With less friction along the checkout process, Shopify aims to help you sell more products.
In terms of the other digital payment providers, there isn’t too much between them. Shopify’s customer care is probably the only thing that sets it apart here – although it’s no small thing. In this case, it will come down to whether you’re already using Shopify or not.