It can be said that to E-Commerce businesses, payment is the Make-or-Break step when it makes the last decision whether your order will be successful or not. And this is the reason why Shopify store owners spend hours considering different Shopify payment gateways.

This article will dive deeper into the differences between two of the most common payment methods in Shopify – Shopify Payments vs PayPal.

Let’s find out the pros and cons of each method with us!

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Shopify Payments vs PayPal Overview 

Shopify Payments

Shopify Payments

As one of the most popular E-Commerce platforms globally, Shopify always tries to bring the best user experiences to both store owners and customers. And they made a vigorous attempt to optimize the payment process with its integrated payment solution – Shopify Payment.

As an e-store owner, if you are in the US, UK, or Canada, Shopify Payment allows you to access easily and allows your customers to make a transaction through a credit card. By removing the third-party service provider, Shopify Payment could help you save 0.5% to 2% on transaction fees.

With this payment method, you will have a chance to experience various analytical and business management solutions.



Nowadays, PayPal is known as the largest e-wallet in the market, integrated by many international e-commerce websites for online payment. In addition, this is also a digital wallet with a wide range of utilities and numerous attractive incentives for users.

Nearly 80% of online shopping websites globally have integrated Paypal payment gateway, helping users finish the transactions of buying and selling goods. When ordering an item on an international e-store, you need to choose “Pay with Paypal” to experience the fast and convenient payment method via Paypal.

This is an electronic payment and money transfer service that replaces traditional methods such as paper checks. Paypal mainly gains profits by performing customer transactions for companies and online businesses, auction sites, and other corporate clients.

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Shopify Payments vs Paypal: Which choice is better?

First and foremost, before going into the details, let’s take a quick look at this Shopify Payment vs Paypal Comparison table below.

  Shopify Payment Paypal
Usability Full integration with the store One of the default payment providers of Shopify
Payout The frequency of receiving a payment: 3 days The frequency of receiving a payment: 5 – 7 days
Chargebacks An efficient chargeback process but tough chargeback rules A time-consuming process with hefty fees
Security High-security measures High-security measures
Fee 2.4-2.7% + 30c per order for the credit card fee 5.4% + 45c transaction fee on every order (If you earn under $5000/month)

1 – Shopify vs Paypal: Usability


Integrating the Shopify Payment gateway with your online store is very easy and convenient, it doesn’t take much of your time. In Shopify’s dashboard, you click on “Setting” -> “Payment Providers.” Choose “Shopify Payment setup” and fill in all necessary information such as your personal information, products, etc.

The installation of PayPal requires more time, but it will not last more than one day. As one of the default payment providers of Shopify, PayPal allows you to set up its payment gateway within your website. However, to use PayPal on a Shopify store, customers have to redirect to the official website of Paypal to finish their transaction. This process might be time-consuming and annoying to several users.

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2 – Shopify Payments vs Paypal: Payout

Electronic transfers via Shopify Payment usually take about 3 business days for the merchants in the US. However, it can take longer depending on your location. In the Shopify dashboard, you can track your money in real time.

On the other hand, PayPal requires you to wait for 5 – 7 business days to receive your payment. Also, you can use the transaction system to check data analysis on a 24/7 basis.

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3 – Shopify vs Paypal: Chargebacks – Protection & Prevention


If there are any claims, Shopify Payment is willing to collect the data and evidence from two sides (both sellers and customers) and make the decision after 60 days. It could be said that this process takes place smoothly and effectively.

If your customer wins the chargeback dispute and receives the refunds, you have to suffer from a punitive measure of $15 for each chargeback. If this situation occurs too many times or continuously, your store and your money in the available sale account will be locked indefinitely.

Hence, be careful of the strict chargeback rules of Shopify Payment.

Meanwhile, with PayPal, you also can respond to every claim or dispute of a transaction. When a claim arises, you have 10 days to provide evidence while your funds will be placed on hold. Paypal might take 75 days or even more to resolve the dispute between you and your customers.

Like Shopify Payment, you will be charged an amount of money that is considered a chargeback fee$20. However, if your transactions are eligible, the Seller Protection program of PayPal will cover this fee for you.

4 – Shopify vs Paypal: Security

Generally, both Shopify Payments vs Paypal perform well in security.

As a merchant, you can find powerful tools like Fraud Block in Shopify stores to meet the security requirements of your website.

Paypal and Seller Protection also provide a Buyer Protection program that helps users experience a safe and easy gateway.

5 -Shopify vs Paypal: Fee

In terms of transaction fees, Shopify Payment has a remarkable edge over PayPal when it removes entirely 0.5% – 2% transaction fees. When choosing this payment method, you need to be charged 2.4-2.7% + 30 cents per order for the credit card fee.

Fees of Shopify Payments

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Especially if you use the Shopify plan of $79 instead of the Basic plan of $29, the credit card fee will decrease from 2.7% + 30 cents to 2.5% + 30 cents.

Your Shopify store has 2 types of currencies. Store currency indicates the currency that is displayed, like the price of products to customers. When sending money into your bank account, Shopify Payment will use Payout currency based on your store’s location.

Suppose that your Shopify store is in the US, while almost all of your customers come from Europe. In this case, the store currency will be EUR, and the payout currency will be USD. Shopify Payment will deposit money into your EUR account which is located in the US.

Shopify will apply the current foreign exchange rate.

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Meanwhile, transaction fees of PayPal depend on the revenue of your online store each month. If you earn under $5000/month, you have to be charged a 5.4% + 45 cents transaction fee on every order, which is more than the commission fee of Shopify Payment (0.5-2% + 30 cents). It means if you opt for the Basic Shopify plan with a monthly income under $5000, you can save 3.4% + 45 cents.

Fees of Paypal

Keep in mind that PayPal also has other hidden fees in case you carry out overseas transactions.

Paypal allows users to manage multi-currencies automatically or manually. However, as an online store owner, you will frequently receive different currencies from customers worldwide. Hence, we highly recommend the feature Auto Accepting Payments of Paypal.

When foreign currency funds are sent to your US dollar account, PayPal will automatically convert them into USD. The exchange rate is updated twice a day, so the current rate (when you receive the money) will decide how much you get.

Should I use PayPal for Shopify?

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Depending on the previous part, you can have a clearer view of the advantages and disadvantages of Shopify Payments vs PayPal and have your own choice.
However, let me show you another option.

Why don’t you set up both payment methods? Customers will be pleased if they have different payment choices according to their shopping habits. It is not difficult to add a PayPal gateway into your online store.

  • Step 1: In the Shopify dashboard, go to Settings > Payments
  • Step 2: In the PayPal section, click Deactivate. Click Deactivate again to confirm.
  • Step 3: Choose PayPal Express Checkout > Click Activate > Enter the email address for your PayPal account, then click Next > Enter the password, then click Sign In
  • Step 4: On the PayPal access page, click I Give Permission
  • Step 5: Go back to Shopify

Set up Paypal on Shopify

Note: Make sure that the email you use to set up your store and create a PayPal account is the same. Besides, to integrate PayPal with your Shopify store, you need to upgrade your personal account to a business account.

BSS Shopify team hopes this guide and comparison of Shopify Payments vs Paypal has helped you acquire useful and informative knowledge about optimizing your Shopify store, especially the payment process. If you are still in doubt, feel free to contact us and consult Customer Support.

For more information about other Shopify payment options, just jump into our Shopify comparisons to find your best fit.