Which payment gateways are supported by subscription apps on Shopify?
Payment Gateways for Subscription Apps in Shopify: A Comprehensive Guide
Subscription-based business models like Seal Subscriptions have been growing rapidly in the eCommerce industry, offering customers the convenience of regular deliveries or services while creating a steady stream of recurring revenue for merchants. Shopify, one of the most popular eCommerce platforms, supports subscription functionality through apps, which allow businesses to integrate subscriptions with their stores. However, the success of these subscription-based models largely depends on the payment gateways used for processing recurring payments. In this article, we will explore the payment gateways that can be used by subscription apps in Shopify, focusing on the auto-charging subscription functionality.
What is Auto-Charging Subscription?
Before diving into the payment gateways, it’s important to understand what auto-charging subscriptions are. Auto-charging refers to the automatic processing of payments on a recurring basis. In a subscription-based business, customers authorize the merchant to charge their payment method automatically at regular intervals (e.g., weekly, monthly, or yearly) without needing to manually approve each transaction. This type of functionality is essential for subscription apps on Shopify, as it ensures smooth and uninterrupted service for customers.
For merchants to use this functionality, Shopify has certain eligibility requirements for payment gateways. These gateways must support the processing of recurring payments to ensure that customers are billed automatically at the agreed-upon intervals. Without the right payment gateway in place, merchants may not be able to offer subscriptions with auto-charging functionality, which could lead to a decrease in customer satisfaction and retention.
Required Payment Gateways for Auto-Charging Subscription Rules
Shopify has set specific guidelines for merchants who wish to offer auto-charging subscriptions through their stores. The following payment gateways are compatible with Shopify’s subscription apps and are required for auto-charging functionality:
- Shopify Payments
- Bankful
- ShopPay
- Apple Pay
- Google Pay
- Authorize.net
- Stripe
- PayPal Express
These payment gateways ensure that merchants can securely and automatically process payments for subscription services. Let's explore each of these payment options in more detail.
1. Shopify Payments
Shopify Payments is the default payment processor for Shopify stores, and it integrates seamlessly with the platform. This gateway is one of the most commonly used by merchants and is fully optimized for subscriptions. Shopify Payments supports recurring billing for subscriptions and is fully integrated into the Shopify ecosystem, making it easier for merchants to manage their subscription services.
One of the key advantages of Shopify Payments is that it is built specifically for Shopify, offering a seamless experience for both merchants and customers. It also eliminates the need for third-party payment providers, which can simplify the setup process. However, Shopify Payments may not be available in all countries, so it’s important for merchants to check if it is supported in their region.
2. Bankful
Bankful is another payment processor that supports recurring billing for Shopify stores offering subscription services. It is usually used by shops, selling CBD products, as Bankful is more open to shops selling high risk products. Bankful is a highly secure, PCI-compliant payment solution that allows businesses to accept both one-time and subscription payments. For businesses looking for a reliable payment processor that can handle high volumes of recurring payments, Bankful is an excellent option.
Bankful offers features like automated invoicing, fraud protection, and easy integration with Shopify. It also supports a wide range of payment methods, making it a flexible option for merchants. While it’s not as commonly used as Shopify Payments or Stripe, Bankful can be an excellent choice for merchants who prioritize security and compliance.
3. ShopPay
ShopPay is Shopify’s own accelerated checkout feature, which allows customers to complete purchases quickly and securely. While ShopPay is often used for one-time purchases, it also supports subscription payments. By enabling ShopPay on your Shopify store, you can offer a streamlined checkout experience for customers who subscribe to your services.
ShopPay has become increasingly popular due to its ease of use, speed, and security features. It allows merchants to offer a more personalized checkout experience, which can increase conversion rates and customer satisfaction. ShopPay is also integrated with Shopify Payments, so merchants don’t need to worry about managing a separate payment gateway.
4. Apple Pay
Apple Pay is a digital wallet that allows customers to make payments using their Apple devices, including iPhones, iPads, and Macs. This payment method supports subscription services and can be integrated with Shopify through the use of Shopify Payments or Stripe.
Apple Pay is widely regarded as a secure and convenient payment option for customers, as it uses biometric authentication (Face ID or Touch ID) to verify transactions. Merchants can take advantage of Apple Pay’s easy setup and high security for processing recurring subscription payments. It’s an excellent option for merchants who want to cater to customers who use Apple devices frequently.
5. Google Pay
Google Pay is a similar payment solution to Apple Pay, but it is designed for Android users. By integrating Google Pay with Shopify, merchants can offer a fast, secure, and convenient payment method for subscription services. Google Pay supports recurring payments and works well for businesses that target mobile-savvy customers who use Android devices.
Like Apple Pay, Google Pay also provides enhanced security through features like tokenization, which protects customer data during transactions. Merchants can benefit from Google Pay’s wide availability and seamless integration with Shopify, making it an excellent option for businesses looking to support recurring payments.
6. Authorize.net
Authorize.net is a trusted payment gateway that supports a variety of payment types, including subscriptions. It is widely used by businesses of all sizes to process recurring payments securely and efficiently. Authorize.net is PCI-compliant and provides robust fraud protection, making it a reliable choice for merchants who need to handle subscription payments.
Authorize.net supports multiple payment methods, including credit cards, debit cards, and e-checks. It can be integrated with Shopify through third-party apps, making it a flexible solution for businesses that want to offer auto-charging subscriptions. It is an excellent option for merchants who need a feature-rich payment gateway with extensive customer support options.
7. Stripe
Stripe is one of the most popular payment processors for subscription-based businesses. Known for its developer-friendly API and seamless integration with Shopify, Stripe supports both one-time and recurring payments. Stripe handles all the complexities of subscription billing, including automatic renewals, invoice management, and dunning management (the process of handling failed payments).
With its robust features, Stripe is an ideal choice for merchants who need a flexible and scalable payment solution for their subscription apps. Stripe also supports a wide range of payment methods, including credit cards, debit cards, and alternative payment methods, allowing merchants to cater to a diverse customer base.
8. PayPal Express
PayPal Express is one of the most widely used online payment platforms, and it is supported by Shopify for both one-time and subscription payments. PayPal Express allows customers to pay using their PayPal accounts, credit cards, and debit cards, making it a versatile and convenient payment method.
For merchants offering subscription-based services, PayPal Express provides automatic recurring billing, which ensures that payments are processed on time without requiring manual intervention. PayPal also offers high levels of fraud protection, which can help safeguard merchants and customers alike. Given its global popularity, PayPal Express is an excellent option for merchants targeting international customers.
Conclusion
When it comes to setting up a subscription-based business on Shopify, choosing the right payment gateway is crucial to ensure smooth, automated billing and enhance the customer experience. Shopify offers several payment gateways that can support auto-charging subscription rules, including Shopify Payments, Bankful, ShopPay, Apple Pay, Google Pay, Authorize.net, Stripe, and PayPal Express.
Each of these payment gateways has its own unique features, benefits, and considerations. Shopify Payments, for instance, offers seamless integration with Shopify, while Stripe and Authorize.net provide robust subscription billing features. Apple Pay and Google Pay cater to mobile-savvy customers, and PayPal Express offers a widely trusted and secure payment solution.
Merchants should evaluate their specific needs, customer base, and geographical location when selecting a payment gateway for their subscription apps on Shopify. By ensuring they meet Shopify’s eligibility requirements and offering multiple payment options, merchants can provide a seamless and convenient subscription experience for their customers.