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Shopify Payment Gateways UK 2018

Growth Secrets|25.03.2018

A payment gateway allows you to take payment from your customers via your website. The price and commission rate is important, but it's also important to see what features they offer.

What Is a Payment Gateway?

A Payment Gateway is what allows a shop or seller to accept cards and other forms of electronic payments online. It is the Internet’s equivalent of a cashier in a shop. When choosing a payment gateway there are a number of features to consider:

  1. Transaction Fees: When you take a payment, some gateways will keep a small percentage or flat fee (or sometimes both) for letting you use their service
  2. Card Types: You need to know what types of card are accepted by your chosen Payment Gateway. All accept VISA, Mastercard and most accept American Express. 
  3. Offsite Checkout: Some gateway will take the payment on their own servers via their own form. An example of this are versions of WorldPay and SagePay.
  4. Fraud Prevention: At present, Shopify does not support 3D secure natively but if you use a hosted solution the gateway may be able to offer this service. 

What is the difference between a Payment Gateway and Merchant Account?

To take payments online you'll need a payment gateway and a merchant account - so what are they?

Payment Gateways

For credit card transactions online and in-store, a service must communicate with the customer's card company to check they have the required funds. In-store, typically, a point of sale machine (such as a card reader) performs this action. For online transactions, a Payment Gateway does this.

Merchant Accounts

Your Payment Gateway connects with your merchant account, which is like a bank account that temporarily holds until they are ready to be sent to your normal business bank account. With services like SagePay and WorldPay, you'll have your own merchant account, whereas PayPal and Stripe let you sign up without a merchant account. This is because they use their own merchant account and this is why they are usually more expensive. The signup process for those services is much quicker though, as getting your own merchant account requires lots of background and credit checks.

Shopify Payments, powered by Stripe:

When you start your Shopify store, your company will need to set up a Merchant Account and a Payment Gateway to allow your business to accept payments from credit or debit cards. The reason you need a Payment Gateway is to check customers have available funds on their card, carry out fraud checks and, most importantly, to take payment.

Shopify payments, powered by Stripe, are the out the box solution that comes with your Shopify package. We have a handy calculator here to see which payment plan your business should be on, dependant on monthly revenue.

Basic Shopify: $29 per month - 2.2% + 20p (transaction fee online)

Shopify: $79 per month - 1.9% + 20p (transaction fee online)

Advanced Shopify: $299 per month - 1.6% + 20p (transaction fee online)

Note: Shopify Plus merchants rates are POA

Shopify Payments, at present, is not supported in European countries (excluding UK and Ireland). Our advice is to research payment gateways in your chosen currency and region and find the best rates for your business. A full list of compatible payment providers can be found here.

PayPal: PayPal Express Checkout can be activated with any Shopify package. However, if you will be charged a transaction fee (from 3.4% to 1.9% + 20p per transaction based on total sales volume).

Amazon Pay: Amazon Pay is a fast, easy, and trusted way for your customers to make purchases on your online store using payment and shipping information stored in their Amazon accounts. Amazon Pay supports USD, GBP, EUR and JPY and is available in the following countries: United States, United Kingdom, Denmark, France, Germany, Hungary, Italy, Japan, Luxembourg, Netherlands, Portugal, Spain and Sweden.

Third Party Payment Gateway Fees:

There are three ways you can be billed for using a 3rd party gateway.

Transaction fees: When you take a payment, some gateways will keep a small percentage or flat fee (or sometimes both) for each payment you take. Each payment gateway will have their own set of rates and some may be negotiable,  see below for the rates for UK payment gateways. 

Monthly fees: Some payment gateways will charge a subscription fee to let you collect money through their service. This monthly charge might vary based on the number of payments being taken or the how many bank accounts the payments are going to.

Setup fees: Setup fees include any costs attributed to starting up your account. You will only need to pay this once.

Shopify Third Party Payment Gateway charges: 

If you are using a third-party gateway, i.e anything other than Shopify Payments you will incur an additional charge. This is to integrate Shopify with external gateways and is a fixed charge per transaction.

Basic Shopify - 2% + 3rd Party Fee

Standard Shopify - 1% + 3rd Party Fee

Advanced Shopify - 0.5% + 3rd Party Fee

Note: Shopify Plus merchants rates are POA

UK Payment gateways compatible with Shopify:

A note about the list of payment gateways below. Many have variable pricing dependant on the number of transactions, so high volume merchants may need a bespoke quote. Some are monthly plans with a set amount of transactions (and fees post the transaction limit) and some are based per transaction. Where possible, we’ve researched the amounts merchant will pay, however for peace of mind and current rates, it’s best to inquire directly with the payment provider.

POA = Price on application

Payment Gateway Set up fee Monthly Cost Transaction fee Website
2Checkout None None 2.4% + 30¢ https://www.2checkout.com
Authorize.net $49 $25 2.9% + 30¢ https://www.authorize.net/
Bancontact via Mollie
iDEAL via Mollie
SOFORT Banking via Mollie
    € 0.25 + 1.5-2.8%
Checkout.com None None POA https://www.checkout.com/
ePay / Payment Solutions From 599 - 999 DDK DDK 99 DKK 0.25
eWAY Rapid 3.1     1.9% - 2.6% + 20c https://www.eway.com.au
G2A Pay POA POA POA https://pay.g2a.com
Mondido Payments No No 1.89% + 0.19 EURO https://www.mondido.com
PaymentExpress £20 - POA £0 - 99 £0.08 - £0.15 https://www.paymentexpress.co.uk/
PaymentSense £9.95 - £19.95 POA   https://www.paymentsense.co.uk
PAYMILL None None 2.95% + 0.28€ https://www.paymill.com/
PayVector (formerly Iridium) None £20 1.9% - 2.6% + 10p http://www.payvector.co.uk/
QuickPay € 25 - POA €0.10 - POA   https://quickpay.net
Realex None £19
(Enterprise POA)
1.75% +9p
(Enterprise POA)
https://www.realexpayments.com
SagePay
20.90/45 to POA for Enterprise
POA   https://www.sagepay.co.uk
WorldPay POA POA POA https://www.worldpay.com

Conclusion

Our recommendation is Shopify Payments as it offers the best overall rates and is powered by Stripe. As you can see there are plenty of options with all kinds of different rates available and this is only a small selection of providers available, Shopify uses 25 different Payment Gateways in the UK alone (view the full list here). So do your research thoroughly and you could end up making quite a saving for your business.

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