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Best Shopify Payment Gateways for UK Stores

SHOPIFY E-COMMERCE BUSINESS
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Ayo is the founder of Why Matters, a Shopify agency based in Brighton. With over 20 years of experience in ecommerce, digital marketing, and ROI-driven growth, he has helped hundreds of Shopify brands build, launch, and scale their online stores. Why Matters is a certified Shopify, Klaviyo, and Recharge partner.

September 17, 2026

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Checked 19 September 2026. Every rate below is UK specific and carries that date. Payment pricing changes more often than almost anything else on a Shopify store, so this article is reviewed quarterly. It is general information rather than payments advice.

Key Takeaways

  • Shopify charges its own fee on top of your provider. In the UK that is 2% on Basic, 1% on Grow, 0.6% on Advanced and 0.2% on Plus, which regularly reverses a comparison that looked favourable.
  • Shopify Payments UK card rates are 2% plus 25p on Basic, 1.7% on Grow, 1.5% on Advanced and 1.3% on Plus, with Amex and international cards charged at 3.1%, 2.7%, 2.5% and 2.3% plus 25p.
  • The mixed setup carries a premium. Running Shopify Payments alongside a direct third party provider means Shopify Payments transactions are charged the standard rate plus 1.25%.
  • Gift cards now count. For stores created on or after 12 May 2025, third party fees apply to the portion of an order paid with store credit or gift cards.
  • Fees are not refunded. Neither the processing fee nor the third party fee comes back when you refund an order.
  • Exemptions exist. Point of sale, cash, cash on delivery, bank deposits and cheques are exempt, and PayPal Express Checkout is exempt while Shopify Payments is active.
  • Some products rule it out. Shopify Payments does not support hemp, CBD or THC, and restricts pseudo pharmaceuticals and unverified health claims.
  • Wallets now dominate UK checkout, at 40% of ecommerce transaction value in 2025, ahead of credit cards at 23% and debit at 22%.

Quick Answer

For most eligible UK stores, Shopify Payments is the right answer, because it removes Shopify’s own third party transaction fee entirely and supports the wallets UK shoppers now use most. A third party gateway makes sense when you cannot activate Shopify Payments, when you have an acquiring relationship worth keeping, or when customers need a method Shopify Payments does not offer. Before switching, add Shopify’s fee to the provider’s rate, because a processor quoting less than Shopify can still cost more once that fee lands. And if you are considering running both, model the 1.25% premium first.

Table of Contents

Payment decisions get made on headline rates, which is how merchants end up paying more for a cheaper looking processor. The rate you compare is only part of the cost, because Shopify charges its own fee when somebody else processes the payment, that fee is not returned on refunds, and running two providers together adds a premium most guides never mention. This article uses UK rates throughout, shows the maths on a realistic example, and covers the situations where Shopify Payments simply is not available to you.

How Shopify Payments Actually Works

Shopify Payments is Shopify’s integrated processor, with payment processing and order management handled inside Shopify. In the UK it supports Visa, Mastercard, American Express, Maestro, Discover, Diners Club and UnionPay, the accelerated checkouts Apple Pay, Google Pay and Shop Pay, and local methods including Klarna, Bancontact, iDEAL, MB WAY and Satispay depending on where the customer is. Local methods display according to the customer’s location rather than yours, which matters when you sell internationally.

Everything else is a third party payment provider, and Shopify supports more than 100 of them. It splits them into direct providers, where the customer pays without leaving your store, and external providers, where they complete payment on a separately hosted checkout. The distinction matters for both conversion and which fees apply.

The Real Cost of a Third Party Gateway

Shopify’s UK third party transaction fee is 2% on Basic, 1% on Grow, 0.6% on Advanced and 0.2% on Plus, charged in addition to whatever your provider charges. Plus stores using Shopify Payments as their sole provider have it waived entirely, including on gift cards and store credit.

The Mixed Setup Premium

This is the least explained cost in Shopify payments. Shopify allows Shopify Payments to run alongside one direct third party provider, with the third party remaining primary for cards while Shopify Payments handles Shop Pay and methods the other provider does not support. The price is that Shopify Payments transactions are then charged the standard rate plus 1.25%, while third party transactions still attract the normal third party fee. Both sides get more expensive, so the extra payment methods have to earn more than the premium costs.

Gift Cards, Refunds and Exemptions

For stores created on or after 12 May 2025, third party fees apply to the portion of an order paid with a Shopify gift card or store credit, so a £100 order settled with £25 of credit still attracts the fee on that £25. Stores created before that date are exempt from this particular rule.

Refunds do not return the fee. In the UK, neither the third party transaction fee nor the original Shopify Payments processing fee comes back when you refund an order, which means high return categories should model payment costs against gross sales rather than net. What is genuinely exempt: point of sale orders, cash, cash on delivery, bank deposits, cheques and qualifying manual methods, plus PayPal Express Checkout while Shopify Payments is active.

A £250,000 Worked Example

Take a Shopify Basic store with £250,000 of annual online revenue, 5,000 orders at an average of £50, all on standard domestic cards, with no refunds, international cards or currency conversion. Shopify Payments on Basic is 2% plus 25p. For the comparison we use an illustrative external processor at 1.5% plus 20p, which is not a quote from any particular provider.

The same £250,000 of sales, three ways Shopify Payments only £6,250 A 50/50 mixed setup £9,562 Third party gateway only £9,750 A cheaper processor rate cost £3,500 more a year Shopify Basic, 5,000 orders at £50, processor shown at 1.5% and 20p. Your plan, order value and negotiated rate all change the result.
Illustrative only. Your plan, order value and negotiated rate change the result.
  1. Shopify Payments only. £5,000 in percentage fees plus £1,250 in fixed fees gives £6,250, with no third party transaction fee at all.
  2. Third party gateway only. The processor costs £3,750 plus £1,000, so £4,750, and Shopify’s 2% fee adds £5,000. Total £9,750, which is £3,500 more than Shopify Payments despite the lower headline rate.
  3. A 50/50 mixed setup. £2,375 to the processor, £2,500 to Shopify on those orders, £3,125 of Shopify Payments processing on the other half, and £1,562.50 of mixed setup premium. Total £9,562.50, or £3,312.50 more than Shopify Payments alone.

The exact numbers change with plan, order value, card mix and negotiated rates. The principle does not: add Shopify’s own fee before deciding a third party gateway is cheaper.

Shopify Payments: When It Is the Right Answer

For most eligible UK businesses this is where we would start. Standard online card rates checked 19 September 2026 are 2% plus 25p on Basic, 1.7% plus 25p on Grow, 1.5% plus 25p on Advanced and 1.3% plus 25p on Plus. American Express and international cards are charged at 3.1%, 2.7%, 2.5% and 2.3% plus 25p respectively, which matters more than merchants expect, because Visa and Mastercard classify UK and EU transactions as international after Brexit.

Beyond the fee structure, you get Shop Pay, Apple Pay and Google Pay natively, local methods shown by customer location, integrated reporting and disputes in one admin, and payouts on a defined schedule. UK settlement is a minimum of three business days, with banks typically needing another 24 to 72 hours, so budget for the longer end when planning cash flow.

When You Cannot Use Shopify Payments

Eligibility depends on your country, business type, products and compliance with the Shopify Payments terms, and several categories we work in run into it.

  • CBD and hemp. Shopify Payments does not support hemp, CBD or THC products at all. Third party providers that accept these merchants do their own underwriting, and approval is never guaranteed by Shopify.
  • Supplements. Not banned outright, but Shopify Payments restricts pseudo pharmaceuticals and products making health claims not verified by an appropriate regulatory body, so your claims affect your payments eligibility as well as your legal position (health and fitness guide).
  • Alcohol. Permitted with conditions, including licensing compliance and effective age verification so alcohol cannot be bought or received by under 18s (snacks and drinks guide).
  • Anything making strong claims. The pattern across beauty, supplements and wellness is that the copy which creates regulatory risk also creates payments risk (beauty guide, eco guide).

One thing merchants often assume incorrectly: if you cannot activate Shopify Payments because of what you sell, standalone Stripe is not the fallback. Shopify does not offer it in countries where Shopify Payments is supported, including the UK, even in that situation.

The Gateways Worth Considering

Grouped by why you would use them rather than ranked, with rates checked 19 September 2026.

  • PayPal, for customers who prefer it. Its standard UK rate for other commercial transactions is 2.9% plus a 30p fixed fee, and PayPal Express Checkout is exempt from Shopify’s third party fee while Shopify Payments is active, which makes it the cheapest way to add a second method.
  • Stripe, usually not an option. Shopify does not offer standalone Stripe in the UK, though its direct UK card price of 1.5% plus 20p is a useful benchmark when judging quotes.
  • Klarna, for buy now pay later through Shopify Payments, at 4.99% plus 30p on Basic, Grow and Advanced, and 3.79% plus 30p on Plus. Materially more expensive than cards, so treat it as a conversion decision.
  • Clearpay, as a separate UK buy now pay later option with a Shopify integration, typically around 6% plus 30p plus VAT, and sometimes up to 8%. Your store address and currency must match your Clearpay region.
  • Worldpay, where you have an existing acquiring relationship. Its Shopify app supports the major card networks and multi currency, but currently documents no Apple Pay or Google Pay support through that app, which is a real conversion cost given wallet usage.
  • Opayo through Elavon, for merchants with an existing Opayo account. Elavon’s published UK fixed ecommerce pricing lists a £25 monthly gateway fee, a 0.99% merchant service charge on UK consumer Visa and Mastercard, and no click fee on the first 350 transactions.
  • Amazon Pay, not currently a UK recommendation. The old third party Shopify integration stopped being supported on 6 January 2025, and Amazon Pay through Shopify Payments is available to eligible US stores.
  • Open banking, through providers such as Atoa, which launched on the App Store as an approved payment partner on 21 August 2025 offering pay by bank for UK businesses. Pricing depends on setup rather than a published rate.

Wallets and Accelerated Checkout

Accelerated checkout is where payment choice meets conversion. Shopify reports that Shop Pay can deliver up to 50% higher conversion than guest checkout and outperforms other accelerated checkouts by at least 10%. Those are Shopify’s own global figures rather than independent UK data, so treat them as directional, but the underlying logic holds: a returning shopper who does not retype card and address details completes more often. That is also why a gateway without wallet support carries a hidden cost, as our conversion rate guide explains.

What UK Shoppers Actually Pay With

Payment choice should follow what customers actually use.

How UK shoppers paid online in 2025 Digital wallets 40% Credit cards 23% Debit cards 22% Buy now pay later 8% Bank to bank 6% Everything else 2% Share of UK ecommerce transaction value, Worldpay 2026 report. Wallets can be funded by cards, so the groups overlap.
Share of UK ecommerce transaction value in 2025, Worldpay Global Payments Report.

Two readings matter. Wallets at 40% of transaction value make Apple Pay, Google Pay and Shop Pay support a requirement rather than a nice to have, which is the practical argument against any gateway that cannot offer them. And the groups overlap, because wallets can be funded by cards, bank accounts, buy now pay later or stored value, so wallet share and card usage are not mutually exclusive. Worldpay separately reports cards at 46% of UK online spending once wallet funding is counted.

Chargebacks, Fraud and Authentication

Shopify Payments uses 3D Secure as part of its strong customer authentication framework, and successfully authenticated payments can shift liability for fraudulent chargebacks from you to the card issuer, subject to network rules and exceptions. That liability shift is worth more than a few basis points on your rate.

Dispute costs differ by provider. The Shopify Payments chargeback fee in the UK is £10, Stripe’s standard UK dispute received fee is £20 and PayPal’s published UK card chargeback fee is £14. In a high dispute category those differences compound, and they belong in the comparison alongside the processing rate.

International Selling and Currency

Selling abroad adds two costs. Shopify charges UK Shopify Payments merchants a 2% currency conversion fee when the customer pays in a currency different from your payout currency, and nothing when the currencies match. Merchants on Advanced or Plus can receive payouts in multiple supported currencies, with multi currency payout fees applying on non domestic currencies. Our Shopify Markets guide covers how the wider setup works, and local payment methods showing by customer location is part of why Markets and payments need planning together.

How to Choose a Payment Gateway

Five questions settle it.

Which payment setup is right? Can you activate Shopify Do customers need a method Have you modelled the extra Payments for what you sell? it does not support? fee and the 1.25% premium? No: third party, No: Shopify No: model it with underwriting Payments alone before switching Yes Yes Yes Then a mixed setup can make sense, as long as the extra methods earn more than the premium costs.
The order we work through with a merchant.

First, are you eligible, given your products and claims? Second, what is the total cost, meaning the provider’s rate plus Shopify’s fee plus any premium, modelled on your own volume rather than a headline percentage? Third, how do your customers want to pay, including wallets and buy now pay later? Fourth, when do you get the money, since settlement timing is a cash flow decision? And fifth, what happens if you switch, including disputes in flight, stored payment methods, subscription tokens and reporting history. That last one catches subscription businesses hardest, as our subscriptions guide explains.

What the Numbers Mean

  1. Shopify’s fee can reverse the comparison. A processor at 1.5% can cost more than Shopify Payments at 2% once the third party fee lands.
  2. A mixed setup is not free insurance. The 1.25% premium applies to the Shopify Payments side and cannot be switched off.
  3. Conversion matters as much as processing cost. With wallets at 40% of UK transaction value, a cheaper gateway without wallet support can lose more than it saves.
  4. Refunds and disputes are real costs, because fees are not returned and chargeback charges vary by provider.
  5. What you sell can decide your processor, which makes payments a product and claims question rather than purely a finance one.

Methodology and Update Schedule

Checked 19 September 2026, using UK figures throughout. Shopify plan rates, third party transaction fees and Shopify Payments behaviour come from Shopify’s UK pricing and help documentation, including its guidance on using Shopify Payments alongside a third party provider. Provider rates come from each provider’s own published pricing. The payment mix comes from the Worldpay Global Payments Report 2026, covering 2025 transaction value. The worked example uses an illustrative external processor rate rather than a quote, and is arithmetic rather than advice. We use no affiliate links. This article is reviewed quarterly, because payment pricing changes faster than anything else we publish, and a wrong rate here is worse than a stale figure elsewhere.

Frequently Asked Questions

What is the best Shopify payment gateway in the UK?

For most eligible UK merchants it is Shopify Payments, because it avoids the extra third party transaction fee entirely. The best answer changes if you sell something it cannot support, or if your customers need a method it does not offer.

What is Shopify's third party transaction fee in the UK?

2% on Basic, 1% on Grow, 0.6% on Advanced and 0.2% on Plus, charged on top of whatever your payment provider charges. Plus stores using Shopify Payments as their sole provider have the fee waived.

How do I avoid Shopify transaction fees?

Use Shopify Payments as your sole payment provider. The fee also does not apply to point of sale orders or qualifying manual methods such as cash, bank deposit and cheque, and PayPal Express Checkout is exempt while Shopify Payments is active.

Does Shopify charge a fee if I use PayPal?

Not for PayPal Express Checkout while Shopify Payments is active, which is a genuine exemption. Other PayPal configurations can attract the third party transaction fee, and PayPal's own charges apply either way.

Can I use Stripe with Shopify in the UK?

Not as a standalone gateway. Shopify does not offer standalone Stripe in countries where Shopify Payments is supported, and that remains the case even when a merchant cannot activate Shopify Payments because of what they sell. Shopify Payments itself is powered by Stripe.

Does Shopify Payments support CBD or supplements?

Shopify Payments does not support hemp, CBD or THC products. Supplements are not banned outright, but Shopify Payments restricts pseudo pharmaceuticals and products making health claims not verified by an appropriate regulatory body, so eligibility depends on your products and claims.

What happens to payment fees when I refund an order?

You do not get them back. In the UK, neither the Shopify Payments processing fee nor the third party transaction fee is returned on a refund, so high return categories should treat that as a real cost.

How long do Shopify Payments payouts take in the UK?

The minimum settlement time is three business days, and banks typically need a further 24 to 72 hours to process the deposit, so plan cash flow around the longer figure.

Why Matters Perspective

Payment decisions get made on the wrong number more often than almost any other ecommerce choice. A merchant is quoted 1.5%, compares it to 2%, switches, and discovers the bill went up because Shopify charges its own fee on every transaction somebody else processes. The fix is not complicated. Put your actual volume into a spreadsheet, add every fee including Shopify’s, and compare totals rather than percentages.

The second thing we would say is that payments are a conversion decision as well as a cost one. With wallets now carrying 40% of UK transaction value, a gateway that cannot offer Apple Pay or Google Pay is expensive regardless of its rate. And for anyone selling supplements, CBD, alcohol or anything making strong claims, payments eligibility should be checked before the product is launched rather than after the first decline, which is the same argument our sector guides make about regulation generally, including our health and fitness guide.

Why Matters is a Shopify Select partner with Verified Skills across development and marketing. Our pricing is published, retainer clients are billed one month in arrears and never tied into long contracts, and every development project carries a 3 month guarantee. See our Shopify packages or email us to talk through your store.

Final Thoughts

The best Shopify payment gateway for a UK store is usually Shopify Payments, not because it is always the cheapest processor, but because Shopify’s own fee structure makes it the cheapest combination for most merchants, and because it supports the wallets UK shoppers now prefer. The exceptions are real though: restricted products, existing acquiring relationships and customers who need a specific method. Work them out with your own numbers, include every fee, and check eligibility before you build the store rather than after the first payment fails.