Understanding transaction fees on e-commerce platforms, is it double?

[ajitkumar101]

I am very new to this platform. I have seen in pricing section in Shopify written 

If I choose a third-party payment provider, there will be additional fees of 2% for our Basic plan.  if I am using payU as payment partner. So I have to pay 2% to PayU & extra 2 % to Shopify. Is it correct or something different calculation is there? 

Also I need to understand More than 50 Shopify-synced orders 1% up to $99/mo USD

Please help me in the above queries. 

[Victor · Accepted solution]

Hi @ajitkumar101,

Yes, this is correct. When you're using a third-party payment gateway, you will pay a transaction fee to Shopify on each order that is made using this gateway. This rate will depend on the plan you are using—2% per transaction is indeed the correct rate when on the Basic plan. You will also be required to pay the payment gateway the processing fees they charge for each order processed using their services.

Can you please confirm where you are seeing the 50 orders at 1% up to $99 USD per month? Please provide me with a link if possible.

[Victor · Accepted solution]

Hi @ajitkumar101,

Right, thank you. Shopify Marketplace Connect is an app we offer that allows you to connect your store to marketplaces such as Amazon, eBay, Etsy, and Walmart. Your first 50 orders via these marketplaces come with no extra fee each month, but after that an extra 1% transaction fee is charged when you receive over 50 in a month. The maximum you'll be charged in transaction fees per month for these marketplace orders is $99 USD. This 1% fee for marketplace orders is charged on top of the 2% fee you pay on each transaction for all orders processed via third-party gateways.

I hope this explains things but please let me know if you have questions.

[Victor · Accepted solution]

Hi @ajitkumar101,

Yes, this is correct. When you're using a third-party payment gateway, you will pay a transaction fee to Shopify on each order that is made using this gateway. This rate will depend on the plan you are using—2% per transaction is indeed the correct rate when on the Basic plan. You will also be required to pay the payment gateway the processing fees they charge for each order processed using their services.

Can you please confirm where you are seeing the 50 orders at 1% up to $99 USD per month? Please provide me with a link if possible.

[ajitkumar101]

Hi Victor,

Thank you for the quick reply. 

 for 50 orders at 1% up to $99 USD per month you can check the link below. Just need to understand this point. 

https://prnt.sc/CrfKMK_7Nlrx

[Victor · Accepted solution]

Hi @ajitkumar101,

Right, thank you. Shopify Marketplace Connect is an app we offer that allows you to connect your store to marketplaces such as Amazon, eBay, Etsy, and Walmart. Your first 50 orders via these marketplaces come with no extra fee each month, but after that an extra 1% transaction fee is charged when you receive over 50 in a month. The maximum you'll be charged in transaction fees per month for these marketplace orders is $99 USD. This 1% fee for marketplace orders is charged on top of the 2% fee you pay on each transaction for all orders processed via third-party gateways.

I hope this explains things but please let me know if you have questions.

[ajitkumar101]

Thank you, Victor, for making things clear to me.

[Victor]

Hi @ajitkumar101,

No problem at all! I'm glad I could help. Please let me know if you have any other questions.

[ajitkumar101]

Hi @Victor,

Hope you are doing well !

I have a another question but not regarding transaction fees this something regarding Order section.

An order will close when it is fulfilled. But I can see in order section there is a statistics called as  Delivered order . I am just curious when & how I can mark the order as Delivered. 

[Victor · Accepted solution]

Hi @ajitkumar101,

I believe this may be for orders fulfilled via local delivery, as you have the option to mark orders as delivered via the Local Delivery app. Typically you wouldn't need to mark online orders as delivered as once you've sent the order via the courier your work is done and marking the order as fulfilled would be sufficient.

[AM-Seller]

Victor, Could you explain this further?

"Your first 50 orders via these marketplaces come with no extra fee each month, but after that an extra 1% transaction fee is charged when you receive over 50 in a month."

Does that mean if I am using Shopify connect to synch the hundreds of products that appear on both my Etsy Store and Shopify store, and let's say my Etsy store sells 70 products this month, Shopify will take a 1% cut of the products sold *on Etsy* (up to $99 in a month)? Even if I end up selling nothing through my Shopify Store or the Shop App? And even if I respond to the orders via Etsy, fulfill them outside of Shopify, etc.?

[Victor]

Hi @AM-Seller,

If you sell the products directly on Etsy without first adding to them to your Shopify store and connecting them via Marketplace Connect then then would be no additional charge. If you do decide to list them via your Shopify store using Marketplace Connect then yes, after your 50th Etsy order of the month an additional 1% transaction fee will be charged for each subsequent order.

You are of course under no obligation to use Marketplace Connect if you do not wish to and you can sell directly on Etsy as well as through your Shopify store. The advantage of using Marketplace Connect is that all of your products, orders, and customers can be viewed in the Shopify admin for all of the channels you choose to sell to, be it via your online store, Etsy, or the variety of other channels you can sell on using Shopify.

You can read more about these charges on our Help Center but please let me know if you have more questions.

[oscar_gomez]

Hi @Victor Thanks for all the information. So what you are saying is that I need to pay the Transaction Fees for the payment provider, and additional a fee for shopify per transaction, Am I right? Im putting an example here just to be very clear:

Payment provider fee: 2% + 0.5 USD
Shopify Fee per transaction: 2%

Total: 4% + 0.5 USD

Is that right?

[Mac]

Hi there, @oscar_gomez!

Thanks for following up.

That is generally correct, however, the rates and percentages may differ based on plan and other factors. Merchants on core plans using a third-party payment provider will be charged transaction fees by both the payment provider and Shopify per transaction. You can learn more about our fees and costs here.

[Nadeemn6]

I have had an issue where in when I used a third party merchant like PayPal, my customers had to input their information once on Shopify and then again on the 3rd party merchant (PayPal). This made the checkout process very cumbersome for the customers, which made me loose quite a bit of sales. Please advise.

[Nadeemn6]

I have had an issue where in when I used a third party merchant like PayPal, my customers had to input their information once on Shopify and then again on the 3rd party merchant (PayPal) again. This made the checkout process very cumbersome for the customers, which made me loose quite a bit of sales. Please advise.

[Ali555]

In Shopify, transaction fees refer to the charges associated with each sale processed through the platform. While Shopify offers various pricing plans, it's important to note that transaction fees are applicable in addition to the monthly subscription fees for certain plans. The transaction fees vary based on the type of plan you're on and whether you use Shopify Payments or an external payment gateway. Shopify Payments is the platform's integrated payment processing solution, and if you use it, you can often benefit from reduced transaction fees compared to using external payment gateways. External payment gateways, such as PayPal or Stripe, may incur additional fees on top of the standard transaction fees charged by Shopify. It's advisable to review the specific pricing details on Shopify's official website to understand the transaction fee structure based on your chosen plan and payment methods.