Here's something Shopify doesn't advertise clearly: Shopify Payments is built on Stripe. When you enable Shopify Payments, you're essentially using Stripe with a Shopify-native wrapper. The processing infrastructure is the same. What's different is the integration, the fees, and a few meaningful features.
Shopify Payments: the integrated option
Shopify Payments is Shopify's own payment gateway, available in about 20 countries including the UK, US, Australia, Canada, and most of Western Europe.
The main advantage: 0% transaction fees. Shopify charges a platform transaction fee (0.5–2% depending on your plan) when you use third-party payment gateways. With Shopify Payments, that fee is waived entirely. You only pay the card processing rate.
Processing rates with Shopify Payments (UK, as of 2026):
- Basic plan: 2% online, 1.7% in person
- Shopify plan: 1.7% online, 1.6% in person
- Advanced plan: 1.5% online, 1.5% in person
Native checkout integration. Shopify Payments integrates directly into Shopify's checkout without any redirect. Shop Pay (Shopify's accelerated checkout) is only available when Shopify Payments is enabled. Shop Pay significantly improves mobile checkout conversion by letting returning customers check out in one tap.
Payouts in your local currency. Revenue goes directly into your bank account without currency conversion if you're in a supported country.
The limitation: not available everywhere. If your country isn't on Shopify Payments' supported list, you can't use it. And in some countries it's available but with a limited feature set.
Stripe as a third-party gateway
Adding Stripe directly as a third-party payment provider gives you more control at the cost of Shopify's transaction fee.
Available in more countries. Stripe supports 46+ countries, significantly more than Shopify Payments. If you're based in a country where Shopify Payments isn't available, Stripe is often the best alternative.
More payment method flexibility. Through Stripe, you can accept a wider range of local payment methods (BACS Direct Debit, SEPA, iDEAL, etc.) and buy-now-pay-later options. Shopify Payments has some of these, but Stripe's coverage is broader.
The cost: Shopify's transaction fee applies. On Basic, that's 2% on top of Stripe's processing fees. On Shopify Advanced, it drops to 0.5%. On Shopify Plus, it drops to 0.15%. At high volume, this adds up to a meaningful amount.
Separate dashboard. Managing Stripe directly means your payment data, disputes, and payouts live in Stripe's dashboard rather than Shopify admin. For most merchants this is a minor inconvenience; for some it's a reason to prefer the unified Shopify Payments view.
When to use Shopify Payments
- You're in a supported country
- You want the lowest total fee structure (no transaction fee)
- You want Shop Pay and its one-tap mobile checkout
- You want everything managed in Shopify admin
For the vast majority of UK, US, Australian, and Western European merchants, Shopify Payments is the right default.
When to use Stripe directly
- You're in a country where Shopify Payments isn't available
- You need payment methods or local options that Shopify Payments doesn't support
- You're running subscriptions via Stripe rather than a Shopify subscription app (separate subscription engine, Shopify as marketing site)
- You're on Shopify Plus, where the transaction fee drops to 0.15% - still a cost, but less painful
Can you use both?
Yes. Shopify lets you enable Shopify Payments as your primary gateway and add Stripe (or other gateways) as an additional option. In practice, most merchants don't need both - the payment methods available through Shopify Payments cover the vast majority of customer preferences in most markets.
The practical answer for most merchants
If you're in a country where Shopify Payments is available and your business model doesn't require subscription billing through Stripe directly: use Shopify Payments. The 0% transaction fee and Shop Pay integration make it the better choice on economics and checkout experience.
If Shopify Payments isn't available for your country, or you're running a subscription model where Stripe handles the billing separately from Shopify: use Stripe as your gateway and factor the transaction fee into your unit economics.
The difference between them is meaningful but rarely the deciding factor in a business decision. Get the payment setup right for your situation, then focus on the things that actually move conversion rate - product page quality, checkout friction, and trust signals.
