Shopify Create Custom Payment Method

Table of Contents

1. Introduction
2. Why Create Custom Payment Methods?
3. Using Manual Payment Methods
4. Integrating Third-Party Custom Payment Gateways
5. Customizing Payment Methods at Checkout
6. Conclusion
7. FAQs

Introduction

Imagine running an online store on Shopify, but not having the payment methods your customers prefer. Frustrating, right? Did you know that 42% of online shoppers abandon their carts due to their preferred payment method not being available? This statistic highlights the importance of having diverse payment options. This blog post will guide you through the process of creating custom payment methods on Shopify. Whether you're targeting a niche market or dealing with unique regional payment preferences, this guide will cover everything you need.

By the end of this post, you’ll learn how to set up manual payment methods, integrate third-party gateways, and customize your checkout options for a seamless customer experience.

Why Create Custom Payment Methods?

The ability to create custom payment methods provides several advantages:

1. Enhanced Customer Experience: Offering payment options that customers trust and prefer can significantly improve their shopping experience.
2. Increased Sales: Catering to regional preferences and unique customer requirements can reduce cart abandonment and increase conversions.
3. Flexibility and Control: Custom payment methods allow more flexibility in managing transactions and payment workflows suited to your business needs.

Using Manual Payment Methods

What Are Manual Payment Methods?

Manual payment methods allow customers to place an order and then pay offline using various non-digital methods such as cash on delivery (COD), bank transfers, or money orders. Unlike automated payment gateways, manual methods require the merchant to verify and mark payments manually.

Types of Manual Payment Methods

• Cash on Delivery (COD): Common in regions where digital payment adoption is low.
• Bank Transfers: Useful for high-value transactions or regions where bank transfers are the norm.
• Money Orders: Used less frequently but still valid in certain scenarios.

Setting Up Manual Payment Methods

Here’s how you can set up manual payment methods in Shopify:

1. Access Payment Settings:

   • Go to Settings > Payments in your Shopify admin dashboard.

2. Select Manual Payment Methods:

   • Scroll to the Manual payment methods section.
   • Click on Add manual payment method.

3. Choose the Payment Method Type:

   • You can use suggested methods like Bank Deposit or create a new custom method like In-Person Payments.

4. Configure Instructions:

   • Enter instructions for the customer on how to complete the payment. This could include bank account details or instructions to pay at pickup.

5. Activate:

   • Once configured, click Activate to make the payment method available at checkout.

Managing Manual Payments

When a customer places an order using a manual payment method, the order status will appear as “Pending” in your Orders dashboard. Here’s how to manage these payments:

1. Verify Payment:

   • Once you receive the payment, navigate to Orders.
   • Locate the order and confirm receipt of payment.

2. Mark as Paid:

   • Change the order status to “Paid”.
   • Proceed to fulfill the order as you would with any other payment method.

Integrating Third-Party Custom Payment Gateways

Sometimes, manual payments won't satisfy your business needs, particularly if you cater to international customers or need more automated solutions.

Why Integrate a Third-Party Payment Gateway?

• Broader Payment Options: Offers customers more payment options like local wallets or international credit cards.
• Automated Processing: Reduces manual workload by automating payment processing.

Steps to Integrate a Third-Party Payment Gateway

1. Choose a Gateway:

   • Research and select a gateway compatible with Shopify and popular in your target region or demographic.

2. Sign Up and Configure:

   • Register with the third-party gateway and complete the necessary setup steps on their platform.

3. Access Shopify Partner Dashboard:

   • Navigate to the Shopify Partner Dashboard and create a new payment extension.

4. Develop and Test Payment App:

   • Use the provided API to develop your custom payment extension. Shopify provides comprehensive API documentation to assist developers.
   • Test the integration in a development store to ensure seamless functionality.

5. Submit for Approval:

   • Shopify requires that payment apps go through an approval process to ensure they meet platform standards.

6. Install and Activate:

   • Once approved, install the payment app on your store and configure it to go live.

Example - PayPal Integration

PayPal is a popular choice, given its international presence and trust factor. Here’s a quick overview of the process:

1. Sign Up for PayPal Business:

   • Create a PayPal Business account if you haven’t already.

2. Navigate to Payment Gateways:

   • In Shopify admin, go to Settings > Payments.
   • Under Supported payment providers, select PayPal and configure your account.

3. Configure Settings:

   • Enable PayPal Express Checkout or PayPal Payments Pro based on your preference.
   • Input necessary API credentials obtained from your PayPal account.

4. Test the Integration:

   • Conduct test transactions to ensure everything is set up correctly.

Customizing Payment Methods at Checkout

Eligibility and Tools Needed

Note that customizing payment methods at checkout is typically available for Shopify Plus merchants. You will need to use the Payment Customization API provided by Shopify.

Steps to Customize Payment Methods

1. Install a Customization App:

   • Use a third-party app from the Shopify App Store that supports payment method customization.

2. Configure Customizations:

   • Inside the app, you can rename, hide, reorder, or sort payment methods.

3. Activate Customizations:

   • Once you’re satisfied with the customization, activate it to apply the changes to your store's checkout process.

Practical Uses

• Regional Customizations: Display specific payment methods based on the customer’s location.
• Customer Segments: Show different payment methods to different customer segments.

Conclusion

Creating custom payment methods on Shopify can dramatically improve customer satisfaction and drive sales. By offering manual payment methods, integrating third-party gateways, and customizing your checkout, you can provide a comprehensive and versatile payment experience. Remember, the key is to understand your customer preferences and tailor the payment options to meet their needs.

FAQs

What are manual payment methods in Shopify?

Manual payment methods allow customers to complete their orders using offline payment methods like cash on delivery, bank transfers, or money orders. These require manual verification and processing by the merchant.

How can I integrate a third-party payment gateway with Shopify?

To integrate a third-party payment gateway, you need to develop a custom payment extension using Shopify’s API, submit it for approval, and then configure it within your store’s payment settings.

Are custom payment methods available to all Shopify plans?

Custom payment methods such as API-based integrations and payment customizations at checkout are primarily available to Shopify Plus merchants.

How do I manage a manual payment once it's received?

Once you receive payment for an order made using a manual payment method, you must manually mark the order as paid in your Shopify admin dashboard and then proceed to fulfill the order.

Can I hide specific payment methods based on customer location?

Yes, with the use of Shopify Plus and the Payment Customization API, you can customize the checkout experience to hide or show specific payment methods based on various criteria such as customer location or cart contents.