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Shopify Payments vs PayPal Fees Compared

Using PayPal as a standalone gateway triggers Shopify's transaction fee on top — here's the real cost comparison.

By Marginory team · Online sellers with hands-on experience across Etsy, Shopify & PODUpdated Fee data verified against official platform documentation

The core difference

Shopify Payments is Shopify's own integrated processor — using it means no additional transaction fee, just the standard processing rate. PayPal (as a standalone gateway) is a third-party processor, which means Shopify's transaction fee applies on top of whatever PayPal itself charges.

Cost comparison on a $50 sale (Basic plan)

MethodProcessing feeShopify transaction feeTotal
Shopify Payments$1.75 (2.9% + $0.30)$0.00$1.75
Standalone PayPal~$1.75 (varies)$1.00 (2%)~$2.75

Illustrative example — verify current PayPal processing rates directly, as they vary by account type and region.

Calculate your exact cost either way →

When PayPal as a secondary option makes sense

Some merchants offer PayPal alongside Shopify Payments to capture buyers who specifically prefer or trust PayPal checkout — accepting the added fee on those specific orders as a cost of maximizing conversion rate.

Related

Shopify Transaction Fees GuideShopify Fee CalculatorFull Shopify Fees GuideShopify Transaction Fee Calculator

Related Tools

Shopify Fee CalculatorShopify Transaction Fee Calculator

Frequently Asked Questions

Does using PayPal on Shopify cost more than Shopify Payments?
Yes, typically — using standalone PayPal as your gateway triggers Shopify's transaction fee (2%/1%/0.5% depending on plan) on top of PayPal's own processing fee, whereas Shopify Payments alone has no added transaction fee.
Can I offer PayPal as an option alongside Shopify Payments?
Yes — many merchants offer both. PayPal Express Checkout as a secondary option at checkout can still trigger the transaction fee on orders paid via PayPal specifically, even if Shopify Payments is your primary gateway.
Why would a merchant still choose PayPal despite the extra fee?
Buyer trust and familiarity with PayPal checkout, existing PayPal business relationships, or needing PayPal-specific features can outweigh the added transaction fee cost for some merchants.