Do you use PayPal with Shopify? 5 things you should know

Considering using PayPal with Shopify instead of Stripe, Skrill or other payment gateways? There’s a lot you need to know!
Despite its reputation, its reliability, and its acceptance among customers, it’s not all gold that glitters on PayPal.
This platform, one of the largest online payment systems, with 227 million active accounts, has become a powerful ally for accepting payments from online consumers.

Can PayPal be used with Shopify?

Can PayPal be used with Shopify? The answer is yes, but this payment gateway works differently than other alternatives.
For example, PayPal users usually have their own account, where they store their funds, but other gateways merely act as intermediaries between sellers and consumers.
PayPal’s integration with Shopify and other e-commerce platforms is quick and easy, which is why 15 million merchants use it among their payment methods.
When Shopify is set up to accept payments via PayPal, a PayPal Express Checkout profile is created. This account allows you to accept credit/debit card and other payments.
But as will be revealed later, using PayPal with Shopify does not store sensitive credit card information, which increases security for e-commerces.

5 things you should know when using PayPal with Shopify

PayPal, easy to integrate into Shopify

Connecting PayPal with Shopify is a process that can be completed in just a few steps. In addition, it has extensive documentation in both Shopify and the payment gateway created by Elon Musk and Peter Thiel.
The first step to integrating them is to log in to Shopify, click on Settings and then on Payments. We then select PayPal Express Checkout, click Activate, and on the login page of this gateway, click Give Permission.
Back to Shopify, in the Payment Authorization section, we click on Automatically Capture Order Payments and Manually Capture Order Payments.
Finally, we click on Save, to keep the changes made.

Synonym for efficiency and great reach

One of the hidden strengths for most e-commerces about PayPal (and that benefits them greatly) are the conversion rates of this gateway.
Up to 87.5% in some cases! Considering that the shopping cart abandonment rate is around 70-90% and that one of the causative factors is the use of poor payment options, this PayPal advantage should make Shopify sellers fall in love.
But in addition to its effectiveness, PayPal also has a huge reach.
Its customers are in more than 200 countries and use up to 25 different currencies. Thanks to PayPal, they can all be easily converted to the local currency and process payments from debit and credit cards.

Seller Protection Program, a plus for e-commerce

But Paypal also has an interesting Seller Protection Program, with an analysis of data and transactions in real time.
In e-commerce, there can be a number of disadvantages for sellers. For example, if a user made the payment via PayPal and sent a complaint to the platform, for an unauthorized transaction, the PayPal team can mediate between both parties and review whether the transaction meets the requirements.
In this way, PayPal benefits good business practices and harms dishonest e-commerce.
But PayPal also helps combat credit card fraud. In addition to reviewing unauthorized transactions, this gateway also analyzes cancellations for suspected fraud or improper claims.

No Setup Fees, But Transaction Fees

Especially for newcomers to e-commerce, PayPal’s Shopify commissions are unknown. They are often discovered as a surprise when reviewing the final amount of payments received.
All payment gateways apply a commission and an additional charge for each transaction processed. It is part of their business model, and e-commerces accept it as something natural for the services provided.
But what is the cost of using PayPal with Shopify? The fees for this payment gateway vary from country to country. For Europe, for example, 3.4% and a charge of 0.35 EUR per transaction apply for shops with a turnover of less than 2500 EUR (payments processed by PayPal).
If the volume of payments processed by PayPal is between 2500 and 10 thousand euros, the commissions drop to 2.9%, with a charge of 0.35 euros per transaction, and so on. For sellers located in the U.S. and other countries, commissions vary, and are very similar.
Due to confusion among some sellers, PayPal has a very useful rate calculator available at this address:
However, it’s worth mentioning that integrating PayPal with Shopify is free, with no hidden costs.
This means that it does not require any kind of investment by the online store, as it only pays PayPal when it processes a transaction. A fair and reasonable system for both parties.

PayPal, one of the hundreds of possible payment gateways in Shopify

Using PayPal with Shopify is a wise and necessary bet, due to the large number of online consumers who prefer this payment method. But is it the best for an ecommerce?
The payment methods compatible with Shopify depend on external providers, and for this reason commissions are applied that can vary substantially.
In the case of PayPal, as specified, merchants must pay 3-5% of the base, plus an additional transaction fee. But other Shopify-compatible payment gateways impose much more competitive fees.
2Checkout, Skrill, Stripe, or WorldPay can be easily integrated into Shopify, and their transaction fees don’t so much reduce ecommerces’ profit.
In the case of Stripe, one of the sellers’ favourites, its commissions when integrated into Shopify is 1.4% per transaction, to which an additional charge of 0.25 euros must be added.
On the other hand, 2Checkout charges 2.4% per transaction, plus an additional charge, not to mention the costs of currency conversion.
As a result, there is a lot of life beyond PayPal.
But even if your commissions are not the lowest for ecommerce, using PayPal with Shopify is recommended, due to the demand for this payment gateway in e-commerce.


Join and get exclusive contents for free.

ECN Team
E-Commerce Nation is The 1st B2B Web Media about E-Commerce in Europe. The team of E-Commerce Explorers help businesses to reach new potential market through delivering useful content. Let us know in comment if you enjoyed this content.