Imagine only accepting payments in cash, check, or wire transfer. You’d need to deal with a cashbox and calculate change in your head. You’d have to make frequent trips to the bank. You might be vulnerable to exposing account info or to bounced checks. Luckily, it’s easy to bypass these headaches; use one of the best payment gateways for merchants.
If you’re unsure which to choose, don’t worry! Use this guide to select the right one for your business. Examine top payment gateways with use cases, features, and pricing, and grow your business with the best choice for you.
What is a payment gateway?
A payment gateway is technology that allows retailers to accept noncash payments from their customers. First, it provides strong customer authentication. Then it encrypts and sends payment information, e.g., credit card numbers, to the merchant’s payment processor.
An in-person point-of-sale (POS) system is a payment gateway. So is an ecommerce checkout tool like Shopify Payments.
What’s the difference between a payment gateway and payment processor?
Payment gateways and payment processors are both essential parts of accepting cashless payments. The difference is their functions. Payment gateways securely collect customer payment information. Payment processors initiate the funds transfer between the customer and merchant accounts.
Say you run a retail store.
Your customer taps their credit card to your Shopify POS system, and the POS collects their payment data. The POS is the payment gateway. Once the payment gateway verifies the transaction is legitimate, it encrypts and sends the customer’s payment data to your payment processor.
Now, your payment processor—in this case, Shopify Payments—receives the customer’s payment information. The payment processor communicates the transaction to the customer’s bank or credit card company (the issuer).
If the issuer (customer’s bank) authorizes the transaction, the payment processor relays an approval to the gateways and merchant. When the merchant captures the payment, it settles funds via the card network from the issuer to the acquirer (merchant’s bank). The acquirer then deposits the funds to the merchant account.
If the issuer declines, the payment processor returns the decline to the payment gateway. The gateway then informs both the customer and merchant.
How do payment gateways work?
Payment gateways might sound technical, but they’re really just a "digital bridge" between your business’s bank account and your customer’s payment method. Here’s how it works in a few key steps:
1. A customer initiates payment on your website’scheckout page with a payment API or in-person through a POS system.
2. The customer enters their payment details into the payment gateway. This may take many forms, such as typing in their card info or tapping the POS. Or, using alternate payment methods like Shop Pay’s one-click checkout.
3. The payment gateway encrypts your customer’s data to block interception from hackers.
4. The payment gateway forwards this encrypted information to the payment processor. The processor acts as a "messenger" that talks to the card networks and the customer’s bank. It sends a request to the card network, such as Visa, Mastercard, or American Express. The network forwards the request to the issuing bank, which authenticates the card’s validity. It also verifies availability of funds or credit and whether the transaction is potentially fraudulent.
5. The payment gateway may also check for fraud with a secure checkout tool.
6. The issuing bank sends an approval or rejection response to the card network, which forwards it to the payment processor. From there it goes to the payment gateway and onto your website or POS system. You’ll see either outcome in your ecommerce platform.
7. If approved, the customer’s bank starts the settlement process to transfer funds from the customer’s account to your merchant account. If it’s denied, the payment gateway shows the reason why. Insufficient funds, fraud risks, and invalid cards are common culprits.
The 7 top payment gateway providers
There are a number of payment gateways to choose from. Here are the top ones to consider:
1. Shopify Payments
Alt: Example checkout page with Shopify Payments showing fields for contact info and a shopping cart content review.
Shopify Payments is Shopify’s own payment gateway. It supports ecommerce merchants’ online and in-person payment processing through a single platform. It’s also Payment Card Industry Data Security Standard (PCI DSS) compliant to protect customer data.
Because Shopify’s payment gateway supports several sales channels, you can use it to accept payments through Facebook, Instagram, TikTok, YouTube, and Google.
To ease checkouts and boost conversion rates, turn on Shop Pay, Shopify’s one-click-checkout offering. Because it remembers customers’ information, Shop Pay streamlines checkouts, lifting conversion rates up to 50% versus guest checkout.
Plus, Shopify merchants enjoy lower transaction fees, leaving more profit in your pocket.
If you want to sell in person, it’s easy to set up an integrated point-of-sale (POS) system with Shopify POS.
Shopify Payments also accepts cryptocurrency: You can accept stablecoins like USDC in your Shopify checkout without adding an additional payment gateway or integration. These types of stablecoins are used in more than a trillion dollars’ worth of transactions each month.
Who it’s for
Shopify merchants
Pricing
Shopify Payments is included in your Shopify subscription pricing. Card rates depend on your plan:
- Basic. 2.9% + 30¢ online, 2.6% + 10¢ in person, and 2% for third-party payment providers.
- Grow. 2.7% + 30¢ online, 2.5% + 10¢ in person, and 1% for third-party payment providers.
- Advanced. 2.5% + 30¢ online, 2.4% + 10¢ in person, and 0.6% for third-party payment providers.
Features
- PCI DSS compliant to protect sensitive financial data
- Accepts multiple payment methods, including credit cards, digital wallets, Shop Pay, buy now, pay later, and PayPal
- Process international payments in your customers’ local currencies
- Intuitive financial reporting tools baked into your Shopify dashboard
- 24/7 customer support available
- Automatic deposits to your business bank account
- Integrated POS system for in-person selling flexibility
- Customization features
- No set up or additional monthly fees
- G2 ⭐️ rating: 4.4 (out of 5)
Take control of your cash flow with Shopify Payments
Only with Shopify Payments can you track your orders and payments all in one place. Have a complete view of your finances, accept local currencies and payment types for a smooth checkout experience.
Discover Shopify Payments2. Stripe
Stripe is a payment gateway separate from any specific ecommerce platform. It integrates with many popular website builders and allows merchants to accept credit card and mobile payments. Like Shopify Payments, it offers POS hardware and includes features for invoicing, recurring payments, and international marketplaces.
Who it’s for
Subscription businesses
Pricing
Stripe has a standard payment processing fee of 2.9% + 30¢ for ecommerce transactions made using cards and digital wallets. There are extra fees for manually entered cards (+0.5%), currency conversions (+1%), and international cards (+1.5%).
In-person payments have a transaction fee of 2.7% + 5,ドル with extra fees including +1.5% for international cards and + 10¢ for contactless payment.
Features
- PCI DSS compliant
- Accepts multiple payment methods
- Processes international payments
- 24/7 customer support
- Integrated POS system
- No monthly fees
- G2 ⭐️ rating: 4.2
3. PayPal
PayPal is a trusted name in the world of online payments, and like other top payment processors, PayPal has protection measures to insulate both buyers and sellers from fraud.
The well-known PayPal name might also reassure customers worried about entering their credit card information into a new site. The downside is PayPal fees are higher than fees from other payment gateways.
Who it’s for
Businesses looking for a well known name
Pricing
PayPal fees vary across transaction types. Paypal takes 3.49% + a fixed fee for PayPal Checkout transactions, and 2.99% + a fixed fee for standard credit and debit card transactions.
The fixed fees depend on currency: For US dollar transactions, the fixed fee is 49¢. International payments cost merchants another 1.5% fee on top of the base transaction fee, plus the fixed fee for that particular currency.
Features
- PCI DSS compliant
- Accepts multiple payment methods
- Processes international payments
- Integrated POS system
- No monthly fees
- G2 ⭐️ rating: 4.4
4. Adyen
Adyen is a Dutch payment gateway accepting an array of currencies and payment methods. It also has a unique pricing structure. It charges a base processing fee of 13,ドル plus different additional fees depending on the payment method.
For example, you’ll pay 13,ドル then the interchange plus rate + 0.6% for Mastercard transactions. For American Express transactions in North America, it would be 13¢ + 3.3% + 10¢.
You might be able to secure a good deal if you know which payment methods your customers use and Adyen happens to offer a low rate for those types.
Who it’s for
Businesses selling internationally
Pricing
Ayden charges a base fee of 13¢ plus an extra fee that varies depending on the customer’s credit card company or bank. There are no monthly fees.
Features
- PCI DSS compliant
- Accepts multiple payment methods
- Processes international payments
- Integrated POS system
- 24/7 customer support
- No monthly fees
- G2 ⭐️ rating: 3.7
5. Authorize.net
Authorize.net is a payment gateway provider owned by Visa. It offers advanced fraud protection, customer data management tools, and accepts various payments including recurring subscription payments and eChecks.
Be advised, Authorize.net is more expensive than other payment gateway providers: You’ll pay a 25ドル monthly subscription on top of transaction fees. You’ll also pay higher fees if you only use Authorize.net’s payment gateway and opt out of its merchant account (most payment gateways offer you a merchant account, too).
Who it’s for
Merchants looking for advanced security features
Pricing
Authorize.net’s pricing depends on whether you only use the payment gateway or its merchant account, too. If you use both, you’ll pay 25ドル/month, then 2.9% + 30¢ per transaction for credit card payments. If you just use the payment gateway, you’ll pay 25ドル/month plus 10¢ per transaction and a daily batch fee of 10¢.
Features
- PCI DSS compliant
- Accepts multiple payment methods
- Processes international payments
- Integrated POS system
- 24/7 customer support
- G2 ⭐️ rating: 4.2
6. Square Payments
Square launched in 2009 as a product for mobile in-person credit card payments. In 2021, it rebranded as Block as its parent company, with Square as a product. Now, Square offers seven types of POS hardware for accepting in-person payments. It also has an online payment gateway for ecommerce transactions.
Note that you can’t directly integrate Square Payments with Shopify, although Square Payments works with other website builders like WooCommerce and Square. Square’s POS systems have options for appointment booking, making it a viable option for service business.
Who it’s for
Service businesses
Pricing
Square charges subscription fees on top of transaction fees, although it has a free subscription plan. In addition to its regular plan, Square sells specialized plans for appointment, retail, and restaurant businesses. Retail and restaurant plans carry higher subscription fees but offer lower transaction rates for paid plans.
Prices and processing fees for Square’s standard plans:
- Free
- Plus: 29ドル/month
- Premium: Custom pricing
-
Payment processing fees:
- In-person credit card (Visa, Mastercard, Discover, AMEX): 2.6% + 15¢
- Online purchase through online store or ecommerce API: 2.9% + 30¢
- Credit card on file or manually entered: 3.5% + 15¢
- Invoices through various options (e.g. Apple Pay, ACH, credit card): 3.3% + 30¢
Features
- PCI DSS compliant
- Accepts multiple payment methods
- Processes international payments
- Integrated POS system
- 24/7 customer support
- G2 ⭐️ rating: 4.6
7. Clover
Clover is a payment gateway provider for in-person businesses. The company sells a number of POS systems for retail businesses, service businesses, and restaurants. Some offer industry-tailored features (like the ability to change food orders or let customers order at a Clover Kiosk). Clover offers competitive transaction fees for in-person transactions.
Clover charges a monthly plan fee on top of transaction fees. You can buy your Clover hardware upfront or pay for it in an extra monthly fee. The second option allows you to upgrade your equipment at any time.
Who it’s for
Restaurants
Pricing
Clover pricing depends on your plan. More expensive plans include more advanced hardware. The prices listed reflect the price of renting the hardware rather than buying it upfront:
- Starter: 16ドル/month for 36 months; 2.6% + 10¢ for in-person, card-present transactions, and 3.5% + 10¢ for card information typed in
- Standard. 180ドル/month for 36 months; 2.5% + 10¢ for in-person, card-present transactions, and 3.5% + 10¢ for card information typed in
- Advanced. 250ドル/month for 36 months; 2.5% + 10¢ for in-person, card-present transactions, and 3.5% + 10¢ for card information typed in
Features
- PCI DSS compliant
- Accepts multiple payment methods
- Processes international payments
- Integrated POS system
- 24/7 customer support
- G2 ⭐️ rating: 3.8
Factors to consider when choosing an online payment gateway provider
Transaction fees are just one of a number of considerations to keep in mind as you browse payment gateways. Here’s what to keep an eye on:
Payment processing fees
Before selecting a payment gateway, consider how your customers will pay. For example, will they enter their credit card information into your online checkout page, or will they tap their cards on a POS?
Once you’ve identified the types of transactions you expect, compare their processing fees across platforms. Different payment gateways charge different fees for:
- Online and in-person payment
- Different payment methods, like credit cards, digital wallets, and debit cards
- Recurring payments, such as subscriptions or invoices
- The customer’s credit card network (American Express, for example, tends to carry higher fees)
- International payments and currencies
Even small fees add up over time. If you process 50,000ドル through a payment gateway each year, for example, a 2.4% fee totals 1,200ドル in transaction fees.
If you go to the upper end and commit to a 3.49% fee, that’s an extra 545ドル you’ll spend on payment processing fees for the year.
Payment methods
A lack of payment method options often leads shoppers to abandon their carts. In 2025, 10% of shoppers said they’d abandoned a cart recently because of a lack of available payment methods. Choosing a gateway that accepts a variety of payment options reduces risk of cart abandonment and helps you close more sales.
Popular payment methods include:
- Credit or debit cards
- Mobile wallets
- PayPal
- Buy now pay later apps
Some payment methods are more popular than others in specific countries. If you’re selling in China, for example, make sure your gateway processes Alipay and WeChat Pay, used by 92% and 85% of Chinese customers, respectively.
Security
Payment gateways handle sensitive financial data your customers expect you to protect. Ensure your shortlisted payment gateway is PCI DSS compliant and has security features like encryption and payment tokenization.
These industry standards set the tone for payment security and protects data belonging to you and your customers when processing online payments.
Integrations
Instead of juggling a number of payment products from different software providers, look for a payment gateway that integrates with other products in your tech stack. These include:
- Your ecommerce platform
- POS software if you sell in-person
- Inventory management systems
- Subscription management tools
- Accounting software
- Analytics tools
Reliability and customer experience
A reliable payment gateway keeps you open for business whenever your customers want to buy. Before committing to a payment gateway, check their uptime reports. The higher the percentage, the better.
If your gateway repeatedly experiences technical difficulties, you can miss out on sales—and potentially deliver a frustrating customer experience. Look for platforms with 24/7 customer support to resolve issues right away.
To make it easy for your customer wherever they shop, make sure your chosen software functions well on desktop, mobile, and tablet devices. You might also consider using a recognizable brand customers know and trust.
Choose the best payment gateway provider for your business
Selecting the payment gateway best for your online business is a big decision. It’s a big part of your customer experience, and payment processing fees can quickly eat into your profit margins.
If you already run your business on Shopify, the platform’s own payment gateway is an easy decision. Shopify Payments offers competitive fees, an easy-to-use POS system, and a variety of payment types. Plus, there’s no need to find a third-party provider that connects with your store. You can do it all in one place.
Start accepting payments fast with Shopify Payments
Skip lengthy third-party activations and go from setup to selling in one click. Shopify Payments comes with your Shopify plan, all you need to do is turn it on.
Discover Shopify PaymentsPayment gateway providers FAQ
Which is the best payment gateway?
- Shopify Payments for Shopify merchants
- Stripe for subscription businesses
- PayPal for companies looking for a well-known name
- Ayden for selling internationally
- Authorize.net for advanced security
- Square for service businesses
- Clover for restaurants
Is PayPal a payment gateway?
Yes, PayPal is a payment gateway because it can accept customer payment data and transmit it. PayPal also functions as a payment processor because it can communicate between the custom’s bank or credit card network and initiate the transfer of funds between the customer’s bank account and the merchant’s.
What is the easiest payment gateway to set up?
Shopify Payments is the easiest payment gateway to set up if you already have a Shopify store. You don’t need to find third-party software; just toggle the payment gateway on within your Shopify admin.
What is the most used payment platform?
PayPal is the most used payment platform. As of the end of 2024, PayPal had 434 million active merchant and consumer accounts and facilitated 26 billion transactions.
Which is the safest payment gateway?
The safest payment gateways include Shopify Payments, PayPal, Stripe, Square, Authorize.net, and Clover. These payment gateways use industry-standard security measures to authenticate transactions for fraud and encrypt customer information.
