Shopify Payment Methods: Every Option Explained (and Which Ones Actually Convert)

The average online store loses 70% of potential sales at checkout. The number one reason? Not enough payment options. Here is every Shopify payment method available, what it costs, and which ones are worth enabling today.

Shopify Payments: The Built-In Default

Shopify Payments is Shopify's own payment processor, powered by Stripe behind the scenes. It comes baked into every Shopify plan and is the simplest way to start accepting credit and debit cards. No third-party accounts. No extra approvals. Just toggle it on and you are live.

The biggest advantage? Zero additional transaction fees. Every other payment gateway on Shopify comes with a 0.5% to 2% surcharge on top of the gateway's own processing fees. Shopify Payments eliminates that entirely. You only pay the standard card processing rate.

Shopify Payments supports Visa, Mastercard, American Express, Discover, JCB, and Diners Club. It also unlocks access to Shop Pay, Apple Pay, and Google Pay automatically. If your business is in a supported country (US, UK, Canada, Australia, and many EU nations), this should be your primary gateway.

Shop Pay and Accelerated Checkouts

Shop Pay is Shopify's accelerated checkout. When a customer uses Shop Pay, their shipping address, billing details, and card info are pre-saved. Checkout takes seconds instead of minutes. According to Shopify, Shop Pay converts 1.72x better than standard checkouts on mobile. That is a massive lift.

Shop Pay also supports carbon-neutral shipping. Every order placed through Shop Pay has its delivery emissions offset automatically. For eco-conscious brands, this is a selling point worth highlighting.

Beyond Shop Pay, you should enable Apple Pay and Google Pay as well. These are one-tap payment options that work on mobile devices and supported browsers. Customers do not need to type a single digit. The faster someone can pay, the less likely they are to abandon.

PayPal

PayPal remains one of the most trusted names in online payments. Over 400 million people have PayPal accounts worldwide. Many of them prefer it because they do not have to share card details with individual stores.

Shopify includes PayPal Express Checkout by default. When you first set up your store, a PayPal account is created using your store email. You will want to confirm and configure this account to ensure payouts are directed correctly.

PayPal charges 2.99% + 49 cents per transaction for standard online payments. If you are already using Shopify Payments as your primary gateway, there are no additional Shopify transaction fees on PayPal orders. Offer both. Some customers will always prefer PayPal.

Stripe as a Standalone Gateway

Because Shopify Payments runs on Stripe infrastructure, most merchants do not need a separate Stripe account. However, if Shopify Payments is not available in your country, Stripe can be added as a third-party gateway through Shopify's payment providers list.

Keep in mind that using Stripe independently means you will pay Shopify's additional transaction fee (0.5% to 2% depending on your plan) on top of Stripe's own processing rate. If Shopify Payments is available to you, use it instead and get Stripe's infrastructure without the extra cost.

Buy Now, Pay Later Options

BNPL has exploded in ecommerce. Letting customers split purchases into installments removes the biggest barrier to high-ticket purchases: sticker shock. Here are the main BNPL options on Shopify.

Shop Pay Installments

Available for US merchants using Shopify Payments. Customers can split orders between $50 and $999 into four interest-free payments, or choose monthly installments for larger orders up to $17,500. You get paid in full upfront. Shopify and Affirm handle the installment collection. No risk to the merchant.

Klarna

Klarna offers "Pay in 4" (four interest-free payments over six weeks), "Pay Later" (full payment in 30 days), and longer-term financing. It is available in over 40 countries and has a massive user base, especially in Europe. Adding Klarna to your checkout can increase average order value by 30% or more for stores selling products above $100.

Afterpay

Afterpay (known as Clearpay in the UK) splits purchases into four equal payments due every two weeks. It is particularly popular with younger shoppers in the US and Australia. Integration is straightforward through the Shopify admin, and you receive the full payment upfront minus a small merchant fee.

Third-Party Payment Gateways

Shopify supports over 100 third-party payment gateways. These are useful when Shopify Payments is not available in your region, or when your business requires a specialized processor. Some popular options include:

• Authorize.net: Long-standing US gateway with robust fraud tools
• 2Checkout (Verifone): Good for international sales with local payment methods
• Worldpay: Major enterprise gateway with global reach
• Adyen: Used by large-scale brands for multi-currency processing
• Mollie: Popular in Europe with competitive rates

Remember: any third-party gateway triggers Shopify's additional transaction fee. On the Basic plan, that is 2% per order on top of the gateway's own charges. On Shopify, it is 1%. On Advanced, it is 0.5%. Factor this into your cost calculations.

Crypto Payments

Shopify merchants can accept Bitcoin, Ethereum, Litecoin, and other cryptocurrencies through integrations like BitPay, Coinbase Commerce, and CoinGate. These operate as third-party payment apps rather than native integrations.

The reality: crypto payments are still a niche. Less than 2% of ecommerce transactions use cryptocurrency. But for certain audiences (tech-forward, crypto-native, international customers avoiding currency conversion), it can be a differentiator. Setup takes minutes through the Shopify App Store.

Manual Payment Methods

Not every transaction needs to go through a payment processor. Shopify supports several manual payment options for specific use cases.

Cash on Delivery (COD)

Essential in markets like India, the Middle East, and Southeast Asia where cash remains king. Customers place orders online and pay when the product arrives. COD can significantly increase conversion rates in these regions, but it also introduces higher return rates. You will need a reliable logistics partner that handles cash collection.

Bank Transfer

Useful for B2B orders, wholesale transactions, or high-value purchases where customers prefer a direct bank transfer. You provide your bank details, the customer sends the funds, and you manually mark the order as paid once it clears.

Money Order and Custom Methods

Shopify lets you create custom manual payment methods with specific instructions. Money orders, checks, or even payment on pickup can all be configured through Settings > Payments > Manual payment methods.

Transaction Fees Comparison

Here is how the costs stack up across Shopify plans. Understanding these numbers is critical to protecting your margins.

The takeaway: if Shopify Payments is available to you, use it as your primary gateway. Every other option costs more. The higher your Shopify plan, the lower your per-transaction cost across the board.

Which Payment Methods Actually Increase Conversions?

Not all payment methods are equal when it comes to reducing abandoned carts. Based on conversion data across thousands of Shopify stores, here is what makes the biggest difference.

• Accelerated checkouts (Shop Pay, Apple Pay, Google Pay): Up to 50% faster checkout. Highest impact on mobile conversion.
• PayPal: 30% of online shoppers prefer it. Removing PayPal costs you sales.
• BNPL (Klarna, Afterpay, Shop Pay Installments): Increases AOV 20-30%. Essential for products over $75.
• Local payment methods: In markets like the Netherlands (iDEAL), Germany (Sofort), or Brazil (Boleto), local methods can drive 40%+ of transactions.
• COD: In eligible markets, adding COD can double conversion rates overnight.

The rule of thumb: offer at least one credit card processor, one digital wallet, one BNPL option, and PayPal. That covers the vast majority of customer preferences globally.

How to Set Up Payment Methods: Step by Step

Step 1: Open Payment Settings

Log in to your Shopify admin. Go to Settings > Payments. This is where all payment configuration lives.

Step 2: Activate Shopify Payments

Click "Activate Shopify Payments" and enter your business details, personal information, and bank account for payouts. Verification usually takes 1-2 business days. You can accept payments while verification is pending.

Step 3: Enable Digital Wallets

Once Shopify Payments is active, navigate to the digital wallets section. Enable Shop Pay, Apple Pay, and Google Pay. All three should be turned on. There is no downside and the conversion benefit is significant.

Step 4: Configure PayPal

Scroll to the PayPal section. Click "Activate PayPal" and log into your PayPal Business account. If you do not have one, create it using the same email as your Shopify store for the smoothest setup.

Step 5: Add BNPL Options

For Shop Pay Installments, this is enabled automatically when you activate Shopify Payments (US merchants only). For Klarna or Afterpay, go to the Shopify App Store, install the provider's app, and follow the onboarding steps. Most approvals happen within 24 hours.

Step 6: Add Manual Methods (If Needed)

Scroll to the bottom of the Payments settings page. Click "Add manual payment method" and choose from COD, bank deposit, money order, or create a custom option. Add clear instructions so customers know exactly what to do.

Step 7: Test Everything

Enable Shopify Payments test mode. Place a test order using each payment method. Verify that order confirmations fire, inventory updates correctly, and the checkout flow is smooth on both desktop and mobile. Disable test mode before going live.

Common Mistakes to Avoid

• Only offering credit cards. You are forcing out every customer who prefers PayPal, Apple Pay, or installment payments.
• Using a third-party gateway when Shopify Payments is available. You are paying an extra 0.5-2% per transaction for no reason.
• Ignoring BNPL. If your average order value is above $75, you are leaving significant revenue on the table.
• Not testing on mobile. A checkout that works on desktop but breaks on mobile is worse than no checkout at all.
• Skipping PayPal. It is free to offer. Roughly a third of shoppers prefer it. Just turn it on.

The Bottom Line

Payment methods are not an afterthought. They are a conversion lever. Every option you add removes friction for a segment of customers who would otherwise leave. Start with Shopify Payments, enable all digital wallets, add PayPal, and layer in a BNPL provider. That stack covers 95% of shoppers.

But here is the thing: the best payment setup in the world will not save a store that looks dated, loads slowly, or feels untrustworthy. A smooth checkout on a well-designed store is what actually converts. Build yours with Clyro, the AI-powered Shopify theme builder that lets you design a high-converting store with simple text commands. No code. No templates. Just describe what you want and launch.