In online shopping, the journey from browsing to purchasing often hits its biggest obstacle at checkout. According to Baymard Institute's latest research, the average documented online shopping cart abandonment rate is 70.22%. Among shoppers who abandon their carts for reasons that can potentially be addressed by merchants, 17% say the checkout process is too long or complicated. Baymard Institute's cart abandonment research
For ecommerce businesses, every abandoned cart represents a potential lost sale. That's why accelerated checkout solutions such as Shop Pay have become increasingly important.
Shop Pay allows eligible customers to securely save their payment and shipping information, making it faster to complete future purchases. Shopify says Shop Pay can increase conversion by up to 50% compared with guest checkout.
In this guide, we'll explain what Shop Pay is, how it works, its key benefits and features, how it compares with Shopify Payments, what Shop Pay Installments offers in 2026, and how businesses can set up Shop Pay.
What Is Shop Pay?
Shop Pay is Shopify's accelerated checkout solution that allows customers to securely save information such as their email address, shipping address, billing information, and payment details. When those customers return to a participating store, Shop Pay can recognize them and pre-fill their information, allowing them to complete a purchase with significantly less data entry.
Shop Pay is designed to reduce friction during checkout. Customers can verify their identity using a passkey or a verification code when required. Returning customers may be able to complete purchases with substantially less information than they would need to enter during a traditional guest checkout.
Shop Pay also includes features beyond basic checkout, including order tracking through the Shop app and access to Shop Pay Installments for eligible merchants and customers.
Shopify has also expanded Shop Pay beyond Shopify-hosted storefronts. Eligible businesses can now integrate Shop Pay into an existing commerce platform without migrating their entire store to Shopify.
For merchants looking for the underlying payment infrastructure required to accept online card payments, an ecommerce merchant account can be an important part of the overall payment setup.
How Does Shop Pay Work?
For customers, Shop Pay works by securely storing payment and shipping information after they opt in. When they encounter Shop Pay at another participating checkout, their saved information can be retrieved and used to speed up the purchasing process.
The basic process works like this:
A customer selects Shop Pay during checkout.
Shop Pay recognizes the customer's account using their email address or other identifying information.
The customer verifies their identity when required.
Shop Pay displays their saved shipping and payment information.
The customer reviews their order and completes the purchase.
Eligible purchases can be tracked through the Shop app and Shop's order-tracking features.
Shop Pay supports payment methods based on the merchant's Shopify Payments configuration and location. The exact payment methods available can vary by country and merchant setup.
For merchants, Shop Pay is an accelerated checkout experience, rather than simply another standalone credit card processor. The underlying payment processing depends on the merchant's payment configuration.
Shop Pay and Third-Party Payment Providers
One important change from older versions of Shop Pay is that merchants can use Shop Pay with eligible third-party payment providers.
Shopify's current documentation allows merchants to activate Shop Pay through certain third-party gateways. The exact eligibility requirements depend on the merchant's location, payment provider, and Shopify account.
This is particularly relevant for businesses that cannot use Shopify Payments.
If you're operating a high-risk business, you may need a high-risk merchant account rather than Shopify Payments. Shopify states that businesses that aren't eligible for Shopify Payments can use a third-party payment provider instead.
However, merchants shouldn't assume that having a third-party processor automatically makes every Shop Pay feature available. Different Shop Pay products have different eligibility requirements.
For example, Shop Pay itself can be activated with eligible third-party gateways, while Shop Pay Installments requires both Shopify Payments and Shop Pay to be activated for eligible stores.
Customer Checkout Process Using Shop Pay
A complicated checkout remains a significant reason shoppers abandon purchases. Baymard's current research found that 17% of U.S. shoppers have abandoned an order because the checkout process was too long or complicated. Baymard checkout research
Shop Pay is designed to remove some of that friction by allowing returning customers to use previously saved information.
A typical Shop Pay checkout looks like this:
The customer selects Shop Pay as their checkout option.
Shop Pay identifies the customer's account.
The customer verifies their identity when required.
Their saved shipping and payment information is displayed.
The customer reviews the order and completes payment.
Eligible purchases can be tracked through Shop's order-tracking features.
Because customers don't have to repeatedly enter the same information, accelerated checkout can make the purchasing process faster, particularly for returning customers.
Shop Pay Benefits and Features
Shop Pay offers several features designed to create a faster and more convenient checkout experience.
Seamless Checkout Experience
Shop Pay reduces the amount of information returning customers need to enter manually. Saved payment and shipping information can make repeat purchases substantially faster than starting from a traditional guest checkout.
Shopify reports that Shop Pay can increase conversion by up to 50% compared with guest checkout. Shopify also says Shop Pay outperforms other accelerated checkout options by at least 10%.
Buy Now, Pay Later With Shop Pay Installments
Shop Pay Installments gives eligible customers the ability to divide purchases into multiple payments.
In the United States, current options can include:
Two interest-free payments every two weeks for qualifying purchases between $35 and $50.
Four interest-free payments every two weeks for qualifying purchases between $50 and $999.99.
Monthly payments for qualifying purchases between $150 and $30,000.
Depending on eligibility and purchase amount, monthly plans can extend to 3, 6, 12, 18, or 24 months.
Monthly installment plans can carry interest, with current rates ranging from 0% to 36% APR where available. Customers may also be required to make a down payment depending on the purchase.
Shop Pay Installments is therefore different from simply offering four interest-free payments. The available financing option depends on the customer's purchase amount and eligibility.
Enhanced Security
Shop Pay uses security and authentication measures designed to protect customer information. Customers can use passkeys or verification codes to authenticate purchases, while payment information is securely handled through Shopify's payment infrastructure.
No payment system completely eliminates fraud or chargebacks, so merchants should continue using appropriate fraud prevention and payment security practices.
Shop Pay extends beyond the checkout itself. Customers can use the Shop app to track eligible purchases from checkout through delivery. Shopify says customers using the Shop app have a 9% higher repurchase rate.
This can give merchants another opportunity to stay connected with customers after a transaction has been completed.
Shop Pay Checkout Links
Shop Pay also supports checkout links that merchants can use across channels such as email, chat, social media, and headless commerce experiences.
These links can allow customers to complete purchases in as little as two taps, giving merchants another way to reduce friction outside their traditional storefront.
Shop Pay vs. Shopify Payments
Shop Pay and Shopify Payments are related but serve different purposes.
Shopify Payments is Shopify's payment processing solution that allows merchants to accept credit cards, debit cards, wallets, and other payment methods.
Shop Pay is an accelerated checkout experience that allows customers to securely save payment and shipping information for faster purchases.
The two can work together. Shopify states that Shop Pay is included with Shopify Payments and transactions are processed at the merchant's Shopify Payments rates.
However, merchants can also use Shopify Payments alongside a direct third-party payment provider in certain circumstances. Shopify's current payment documentation states that merchants can use Shopify Payments, a third-party provider, or both together for credit card payments.
For merchants using third-party processors, the exact setup and fees depend on the merchant's payment configuration and Shopify plan.
If you're considering Shopify for a high-risk business, our guide to high-risk Shopify merchant accounts explains how third-party payment processing can work for businesses that don't qualify for Shopify Payments.
What Is Shop Pay Installments and How Does It Work?
Shop Pay Installments is Shopify's buy now, pay later solution, provided through Affirm and its lending partners. It allows eligible customers to divide the cost of qualifying purchases into multiple payments.
How Shop Pay Installments Works
When a customer selects Shop Pay Installments, the available payment options depend on the customer's location, purchase amount, and eligibility.
For U.S. customers, current options include:
Two biweekly payments: Available for qualifying purchases from $35 to $50.
Four biweekly payments: Available for qualifying purchases from $50 to $999.99.
Monthly payments: Available for qualifying purchases from $150 to $30,000, with available terms depending on the purchase amount.
Monthly plans may have an APR between 0% and 36%, depending on the offer and eligibility.
Who Is Eligible for Shop Pay Installments?
Shop Pay Installments has more restrictive requirements than Shop Pay itself.
Shopify currently states that Shop Pay Installments is available to eligible stores in the United States, Canada, and United Kingdom. Merchants must have both Shopify Payments and Shop Pay activated.
For U.S. merchants, this means a business that cannot use Shopify Payments may be able to use Shop Pay through an eligible third-party payment provider, but it would not automatically qualify for Shop Pay Installments.
This distinction is especially important for high-risk merchants.
Shop Pay Alternatives
Shop Pay isn't the only accelerated checkout or alternative payment option available to ecommerce merchants. Depending on your customers and business model, other options include:
PayPal: A widely recognized digital payment solution that allows customers to pay using PayPal or eligible linked payment methods.
Klarna: A buy now, pay later provider offering installment and financing options for eligible customers.
Stripe: A flexible payment processing platform with customizable checkout and developer tools.
Square: A payment platform commonly used by small businesses for online and in-person payments.
Apple Pay and Google Pay: Digital wallets that allow customers to use saved payment information for faster checkout on supported devices and browsers.
The best payment mix depends on your customers, average order value, industry, and payment-processing requirements.
For businesses that need more specialized payment infrastructure, a payment gateway can connect an ecommerce store with its merchant account and payment processor.
How to Set Up Shop Pay on Your Shopify Store
The setup process depends on whether you use Shopify Payments or an eligible third-party payment provider.
Enable Shop Pay With Shopify Payments
If you use Shopify Payments, Shop Pay can be activated through your Shopify admin.
Log in to your Shopify admin.
Go to Settings > Payments.
In the Shopify Payments section, click Manage.
In the Shop Pay section, select the option to enable Shop Pay.
Save your changes.
Shopify's current documentation provides the specific activation steps and requirements for your store.
Shop Pay is included with Shopify Payments, so there isn't a separate Shop Pay subscription fee. However, normal payment-processing fees still apply according to your Shopify Payments setup.
Enable Shop Pay With a Third-Party Payment Provider
Shopify also allows Shop Pay to be activated with eligible third-party payment gateways.
The current process is:
Log in to your Shopify admin.
Go to Settings > Payments.
In the Third-party payment provider section, click Manage.
In the Shop Pay section, select Enable Shop Pay.
Click Save.
In the Shop Pay section, click Complete setup.
Enter the required business, store, and banking information.
Save your settings.
Availability depends on the merchant's location and payment setup. Shopify's documentation should be checked before beginning the integration.
Shop Pay on Other Commerce Platforms
Shopify has also expanded Shop Pay to businesses that don't use Shopify as their primary commerce platform.
Eligible businesses can add Shop Pay to an existing checkout without migrating their entire store to Shopify. Shopify requires the checkout to collect the customer's email address before payment, the business to be eligible for Shopify Payments, and the store to be located in a region where Shopify Payments is available. The integration also requires working with Shopify's Shop Pay Wallet API.
This makes Shop Pay more flexible than it was when it was primarily associated with Shopify-hosted stores.
Can High-Risk Businesses Use Shop Pay?
This is one of the most important questions for businesses in high-risk industries.
The answer depends on which Shop Pay feature you're trying to use.
Shopify states that businesses that aren't eligible for Shopify Payments can use a third-party payment provider.
Shopify also provides a process for activating Shop Pay with eligible third-party payment gateways.
However, Shop Pay Installments has separate eligibility requirements and requires both Shopify Payments and Shop Pay to be activated.
That means a high-risk merchant may be able to use Shop Pay through an eligible payment setup while not being eligible for Shop Pay Installments.
If you're unsure whether your business can process payments on Shopify, our guide to high-risk payment processing for Shopify covers third-party processing options and considerations for high-risk merchants.
Set Up Your Payment Options With Zen Payments
Choosing the right payment infrastructure is an important part of building an ecommerce checkout.
Shop Pay can help reduce friction for eligible customers, but the underlying payment processor remains an important part of the payment stack. Processing rates, chargeback management, fraud prevention, recurring billing, gateway compatibility, and industry eligibility can all affect your payment strategy.
For high-risk businesses, payment eligibility is particularly important. Shopify's payment products have specific requirements, and businesses that don't qualify for Shopify Payments may need to work with a third-party payment provider.
Zen Payments helps businesses evaluate payment-processing options based on their industry and payment needs. If you're looking for a payment processing solution for your ecommerce business, contact Zen Payments to discuss your options.
Taylor Stika is the CEO and Founder of Zen Payments. With a background in the payment processing industry starting in 2015, Taylor has extensive experience in managing and optimizing payment systems. Under his leadership, Zen Payments has grown and developed into a reputable provider of high and low-risk payment.
Our merchant service specialists are the best in the business and will work with you from start to finish to get your account approved!
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Frequently Asked Questions
Using Shop Pay as an accelerated checkout does not itself function as a credit product.
However, Shop Pay Installments is a separate financing product provided through Affirm and its lending partners. Customers using installment financing may be subject to an eligibility check and different credit-related terms depending on the payment option. Current monthly installment plans can carry interest depending on the customer's offer.
Therefore, it's important to distinguish between regular Shop Pay checkout and Shop Pay Installments when discussing credit.
Shop Pay uses security and authentication measures designed to protect customers' payment information. Customers can use passkeys or verification codes to authenticate purchases, while payment information is securely handled through Shopify's payment infrastructure.
As with any online payment method, merchants should continue using appropriate fraud prevention and security practices.
Shop Pay is included with Shopify Payments, and Shopify states that transactions using Shop Pay are processed at the merchant's Shopify Payments rates.
However, merchants using third-party payment providers can have additional transaction fees depending on their Shopify plan and payment configuration. Shopify states that third-party transaction fees can apply to transactions processed through third-party or alternate payment gateways.
Before enabling Shop Pay, merchants should review the current Shopify fees that apply to their specific account.
In the United States and Canada, Shop Pay Installments currently supports eligible orders from $35 to $30,000. In the United Kingdom, eligible orders range from £50 to £30,000.
The available payment options depend on the customer's location, purchase amount, and eligibility.
Potentially, but eligibility depends on the merchant's business, location, payment provider, and the specific Shop Pay product.
Shopify allows eligible merchants to activate Shop Pay with certain third-party payment gateways. However, Shop Pay Installments has additional requirements and requires Shopify Payments.
If you're a high-risk business that can't use Shopify Payments, a third-party payment provider may be an option. You can learn more about high-risk Shopify merchant accounts and the payment options available to businesses in higher-risk industries.
In some cases, yes.
Shopify allows eligible merchants to activate Shop Pay through certain third-party payment gateways. However, Shop Pay Installments requires Shopify Payments and Shop Pay, so the availability of Shop Pay does not necessarily mean every Shop Pay feature will be available.
Yes. Shopify now allows eligible businesses to integrate Shop Pay with an existing commerce platform without migrating their entire store to Shopify.
The integration has specific requirements, including Shopify Payments eligibility and API integration requirements.
For businesses using Shopify itself, Shop Pay can also be activated through Shopify Payments or eligible third-party payment gateways depending on the merchant's circumstances.
