How to Troubleshoot Failed Shopify Payments Payouts

Nick
Community Moderator
Community Moderator

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Shopify Payments is the easiest way to accept payments on a Shopify store. It avoids the hassle of having to set up an account with a third-party payment provider but more importantly it also enables Shopify Support to help troubleshoot any issues with your funds. You can find out more about Shopify Payments from Shopify’s help guide here

 

A payout is the money you receive to your bank account via an order from your store. If your store has Shopify Payments enabled, then you’ll receive the payments directly to your bank account. However; sometimes these payouts fail, which can result in there being a delay in receiving your funds. Below we’ll provide information on the most common reasons payouts fail and how you can troubleshoot the issue. 

 

The primary reasons Shopify Payments payouts could fail can be seen below:

  • Incorrect bank account information
  • Account currency mismatch
  • Invalid account type
  • Incorrect beneficiary/ recipient name
  • Insufficient funds to cover a negative payout

 

Let’s touch on these with some more detail:

 

Incorrect bank account information:

In these cases, your bank has sent the payout back to Shopify saying that the bank account doesn’t exist or has been closed. More often than not, this is caused by entering the banking details incorrectly. You will have an option to update your banking details and the system will retry the payout within 3 business days. If the payout is unsuccessful after these steps, the best next step is to contact Shopify Support to make sure all banking details are entered correctly in your store admin. 

 

Bank account currency: 

Bank accounts typically accept deposits in one currency, so if your Shopify Payments account is set to payout in a different currency,  the payout will likely fail. For example, if your bank account is set to CAD, but your payouts are in USD - Your bank will reject the payment because the account does not support USD funds. To fix this, you’ll need to add the correct bank account type and retry the payout. Please see the help guide about Selling and getting paid in different currencies here for more information. 

 

Invalid account type:

If your bank account is not supported, then the payout will likely fail. The most common cause is the account being a savings account or an online only checking/current account. You can find more information about supported bank accounts in our Setting up Shopify Payments guide

 

Incorrect beneficiary/recipient name:

If the beneficiary name on the Shopify payout doesn’t match the name on the bank account, it’s possible the bank will reject the payout and send it back as a failed payout. 

For sole traders/ sole proprietorship accounts the payout would be in your (the store owners) name. For all other business types(Corporations, Nonprofits, Partnerships), the payouts would be in the business name. If this is the reason for your failed payout, then please contact Shopify Support for further assistance. 

 

Banks may also reject a payout if the Payout Descriptor doesn’t match what is expected. For example, if payouts are failing and all other details of the account are correct, then it’s recommended by the bank that sole proprietors include the name of the bank account owner in the payout descriptor. Something to note is that this isn’t always the owner of the business. What we recommend is to add a business name that matches the name on the bank account to the payout descriptor. This can be changed by the store owner and looks like the image below. 

 

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Insufficient funds to cover a negative payout:

When there are insufficient funds to cover a negative payout, Shopify will try to deduct the amount owed from the store owners bank account. This will only happen for stores in Australia, Canada and the USA. If there are insufficient funds in the bank account for this, the payout will appear as failed. For store owners in every other country, the refunds which are processed will be taken from future payouts.

 

What to do next? 

Unless it is an error from the bank account directly, Shopify will attempt to include the funds in the next payout window, which is typically a few business days. If you click through the payout section of your store admin you’ll be able to see the details of the next payout window.

 

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In the case the payout has already been generated, you’ll also be able to see a dashboard of your previous completed payouts. 

 

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If it is an error with the bank account, then you’ll see a banner saying that the payout is on hold. This means that the payout will not be retried automatically and will require contacting Shopify Support for further assistance.

 

Something good to know is that if a customer pays you via a third-party payment provider then the payout would go directly to the account of that payment provider. For any failed payouts for an order from a third-party payment provider, you would need to contact the provider directly. You can confirm if an order was paid via a third-party provider by opening the order and scrolling down to the order timeline. The payment line will indicate what payment provider was used at the time of the order.