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Shopify Payments Review

By
Lori Fairbanks
,
business.com writer
|
Oct 08, 2019
Home
> Finance
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For e-commerce businesses that open up pop-up shops and need a way to accept credit cards in person, we recommend Shopify Payments – the in-house credit card processing service offered by Shopify. This cloud-based e-commerce platform serves more than 800,000 merchants across 175 countries, including well-known brands like Nestle and Red Bull. 

Shopify Payments

Shopify Payments

The Best Mobile Credit Card Processing Solutions of 2020

The Verdict

Shopify Payments, our top processor for online businesses, offers month-to-month terms and simple flat rates. Its mobile credit card payment apps include powerful point-of-sale tools to help you run your online business and accept payments on the go.

It's our choice as the best mobile credit card processing service for online businesses because it makes it easy for you to accept payments across multiple channels: on your website or blog, on social media, and in person at various locations using your phone or tablet. 

Shopify Payments has competitive flat rates, 24/7 phone support and no long-term contract. Its credit card payment app comes with point-of-sale features, and you can choose from two mobile card readers, both of which are EMV compliant. 

Visit our best picks page to see all of our recommendations for mobile credit card processing companies. 

Pricing and Terms

Shopify Payments is very transparent with its pricing and terms. On its website, you can find its rates, fees, and credit card processing hardware costs as well as its acceptable use policy and terms of service for both its payment processing service and e-commerce platform. This information makes it easier to determine whether Shopify Payments meets the specific needs of your business and fits your budget before spending time on the phone speaking with a sales rep. Shopify Payments uses the flat-rate pricing model and offers competitive transaction fees, especially on its higher-tier plans. 

Rates

Here's what it costs to accept credit and debit card transactions using Shopify Payments on each of Shopify's main pricing plans. Custom processing fees are available for large, high-volume businesses through the Shopify Plus plan. 

Shopify Lite and Basic Shopify plans:

  • Cards you accept in person using a card reader: 7%
  • Cards you accept online or manually key in: 9% + $0.30 

Shopify plan:

  • Cards you accept in person using a card reader: 5%
  • Cards you accept online or manually key in: 6% + $0.30 

Advanced Shopify plan:

  • Cards you accept in person using a card reader: 4%
  • Cards you accept online or manually key in: 4% + $0.30 

Fees

Unlike most mobile payment facilitators, Shopify charges a monthly fee to use its services. Although this fee is technically for Shopify's POS and e-commerce software, you can't use Shopify Payments without it. However, it gives you high-quality POS tools with your account and enables you to sell your goods and services online and in person. Each plan ‒ except the Lite plan – comes with a Shopify online store, which includes an e-commerce website and blog. 

Monthly Fee

The monthly fee varies, depending on which plan you choose. If you pay upfront rather than month to month, you receive a 10% discount on an annual plan or a 20% discount on a two-year plan. 

  • Shopify Lite: $9. You can accept payments in person, on social media and on an existing website or blog.
  • Basic Shopify: $29. In addition to the sales channels included with the Lite plan, you can accept payments on your Shopify online store. This plan supports two staff accounts.
  • Shopify: $79. This includes all Basic plan features and supports five staff accounts.
  • Advanced Shopify: $299. This includes all Shopify plan features and supports 15 staff accounts.
  • Shopify Plus: Custom pricing is available for high-volume merchants. 

Optional Fees

Some of Shopify's optional services carry extra costs. Here are some examples. 

  • Custom domain names start at $11 per year. If you don't already have a domain name for your website and prefer not to use the free MyShopify.com domain name that comes with your Shopify subscription, you can purchase one from the company.
  • Some integrations, available through the Shopify App Store, carry monthly fees.
  • If you choose to use an external payment provider or payment gateway instead of Shopify Payments, you will be charged a fee of 0.5% to 2%, depending on your plan. 

Payout

It usually takes one or two business days for Shopify Payments to transfer your processed funds into your business bank account, which is on a par with other top credit card processing companies. You receive an email alert when your funds arrive. If you prefer to receive your funds weekly or monthly, you can set up a payout schedule. 

Terms of Service

Shopify has month-to-month terms and allows you to upgrade to a higher plan or downgrade to a lower one at any time. A discount is available if you sign up and pay in advance for a one- or two-year term, but no refunds are available if you prepay and later cancel, so you want to make sure the service is a good fit for your business before you sign up for longer terms. 

Shopify is a payment facilitator and sets you up as a submerchant under its master merchant account instead of providing you with your own merchant account, so rather than sign a contract, you agree to the company's terms of service. You should read the Shopify Payments' terms of service, the merchant terms of service and the acceptable use policy, which are posted online, before signing up for an account to make sure that you understand your responsibilities and verify that this payment processor supports your business type. 

Like other mobile payment facilitators, Shopify Payments seeks to prevent fraudulent activity and minimize its risk of losing money. It will hold your funds or close your account if it feels there's something suspicious about your account activity, if you have what it considers to be an excessive number of chargebacks or refunds, or if it expects that you will have an excessive number of chargebacks or refunds. 

Also, like nearly every mobile credit card processor, there are many business types that Shopify doesn't support. Before signing up for an account, you'll want to verify that the goods and services your business sells aren't on Shopify's list of prohibited products or services. If they are, the company will close your account. You can find this list in Section B, paragraph five of the Payments Terms of Service

Shopify Features

Shopify has two mobile apps, and you'll use both to get the most from your Shopify Payments account. The Shopify POS app is for processing payments in person, and you can accept all major credit and debit cards with it. The Shopify app is for managing your sales data, orders, products, customers and staff. Both apps are available for Android and iOS phones and tablets. The Shopify app is also available for the Apple Watch, showing you an overview of your sales data. Here are some examples of things you can do with these apps: 

  • Accept credit and debit cards, including contactless cards and mobile wallets like Apple Pay and Google Pay
  • Record cash payments and checks
  • Split tenders (accept two or more payment types for a transaction)
  • Accept partial payments or deposits
  • Accept tips
  • Issue refunds
  • Email or print receipts
  • Set discounts and taxes
  • Create customer profiles
  • Manage products, add photos, organize into categories, track inventory 

Processing Equipment Options

There are two mobile card readers available for use with Shopify Payments. Both options are EMV compliant, so you can accept chip cards and avoid liability for counterfeit fraud for the cards you accept in person. 

  • Chip and Swipe Reader: $29. This mobile credit card reader connects to your phone or tablet via Bluetooth, and is compatible with Android and iOS devices. With it, you can accept chip and magnetic stripe cards.
  • Shopify Tap and Chip Reader: $49; charging dock: $39. This EMV- and PCI-certified mobile card reader connects via Bluetooth, and is compatible with Android and iOS devices. With it, you can accept chip cards, contactless cards and mobile payments like Apple Pay and Google Pay. 

If you want to connect a receipt printer or barcode scanner to your phone or tablet, you'll need to subscribe to the Shopify plan or higher. 

Dashboard

The dashboard shows you an overview of your sales, and if you also have an online store or sell on social media, you can monitor your traffic. You can see which products sell best and which ones underperform. You can generate reports and export them to a spreadsheet or send them to your accountant. 

Integrations

More than 1,200 apps are available in the Shopify App Store. You can add advanced features to your account and connect to third-party business applications that you may already use, such as accounting software like QuickBooks and email marketing services like Mailchimp. 

Sell on Social Media

You can use Shopify to sell your products on Facebook, Facebook Messenger, Houzz, Instagram and Pinterest. Other sales channels you can sell on include Amazon and eBay. You can see all your sales channel options in the Shopify App Store. 

No Signature Required

When you accept chip cards in person, you're no longer required to capture signatures at checkout. Shopify allows you to opt in to this feature, which can speed up the checkout experience for your customers. However, you can continue to accept signatures if you prefer. 

Additional Considerations

Shopify Payments is for business use only, so if you're looking for a mobile credit card processing service that allows you to accept payments for personal or family use, you'll need to choose a different processor. 

Here's more information to keep in mind before signing up with Shopify Payments. 

Security

Shopify keeps your data secure by complying with Level 1 PCI data security, which has the most stringent security requirements for payment processors. Its card readers are EMV-certified, which has proven to be an effective tool against counterfeit fraud. 

Additionally, the company provides fraud prevention tools for Shopify merchants, including fraud analysis indicators that identify potential issues, such as incorrect CVV codes or attempts to pay with multiple cards. It assigns a fraud recommendation for each order and flags orders it considers to be a medium or high risk on the Orders page for you to review. A free Fraud Filter app from Shopify is available on Shopify's app store, as are multiple third-party fraud prevention apps, and Shopify Plus merchants can use Shopify Flow to create a workflow that notifies you when an order is created that raises red flags. 

The company recently announced a new feature called Fraud Protect for Shopify Payments that analyzes online orders for fraudulent chargebacks. Exact pricing for this feature hasn't yet been released, but the company notes that you'll pay a small fee for each order it classifies as "protected." Then, if there's a chargeback for fraud on an order it flagged as safe, the company will handle the dispute and reimburse you the cost of the order, plus it takes care of the chargeback process for you. 

Customer Support

You can reach customer service by phone 24/7, or by phone, email, live chat or Twitter. If you'd prefer to troubleshoot an issue yourself, the company provides multiple resources to help you, including guides and tutorials, a searchable knowledgebase, a user forum, and a blog. 

Limitations

As with other mobile payment facilitators, you can find complaints online about Shopify Payments holding processed funds and closing accounts. You may be able to avoid these headaches by reading the terms of service for Shopify and Shopify Payments before signing up to make sure that your business type and the products you sell aren't prohibited businesses. You also want to be aware of actions that raise red flags and may cause the company to hold your funds. 

Here are some additional issues to consider before selecting Shopify Payments as your mobile credit card processor: 

  • Adding users to your account can be expensive. The number of staff accounts you can add corresponds with the pricing plan you choose.
  • You'll need to subscribe to the Shopify plan or higher if you want to connect to a receipt printer or barcode scanner.
  • Not all Shopify POS apps are created equal. Although you can ring up sales and accept payments using an iPhone, iPad or Android device, you'll need an iPad if you want to access every feature, as some are lacking on the iPhone and Android versions of the mobile app. You can view a device comparison chart on the company's website.

Editor's note: Looking for a credit card processor? Fill out the below questionnaire to have our vendor partners contact you about your needs.

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Shopify Payments

Shopify Payments

The Best Mobile Credit Card Processing Solutions of 2020

The Verdict

Shopify Payments, our top processor for online businesses, offers month-to-month terms and simple flat rates. Its mobile credit card payment apps include powerful point-of-sale tools to help you run your online business and accept payments on the go.

Lori Fairbanks
Lori Fairbanks
Lori Fairbanks has years of experience writing and editing for both print and online publications. After graduating from Brigham Young University with a Bachelor of Arts in English, she worked as a magazine editor and then as a freelance writer and editor for a variety of companies, including marketing firms and a medical university. She now writes for business.com and Business News Daily about financial systems and services for small businesses, such as accounting software, credit card processing and point-of-sale systems.