Shop Pay vs Shopify Payments – What's the Difference?

When it comes to selling online in the UK, merchants are often caught in the weeds of technical jargon. Two terms that cause more confusion than they should are Shopify Payments and Shop Pay. Many use them interchangeably, but they’re not the same thing. Misunderstanding the difference can affect checkout performance, customer trust, and even your bottom line through Shopify payment fees.

At WIRO, we see too many brands treating payments as an afterthought. But the truth is: in the current UK eCommerce landscape, how you take money is just as important as how you make it. Let’s cut through the noise.

What is Shopify Payments?

Shopify Payments is Shopify’s built-in payment gateway. Think of it as the engine that powers transactions on your Shopify account. Instead of bolting on third-party processors like Stripe or PayPal, Shopify Payments is native.

In the UK, it allows merchants to accept credit cards, debit cards, Apple Pay, Google Pay, and more all without redirecting customers elsewhere. It also reduces your reliance on external providers (and their added costs).

However, there’s no sugar-coating it: Shopify payment fees still apply. UK merchants typically pay around 1.5% + 25p per transaction for domestic cards, with slightly higher rates for international cards. You can avoid extra Shopify transaction fees (the 2% surcharge on third-party providers), but you’ll still want to pay close attention to how these fees affect your margins.

What is Shop Pay?

Shop Pay (previously Shopify Pay) is an accelerated checkout option launched by the ecommerce platform Shopify, that lets shoppers save their personal and payment details, such as email address, payment method, shipping and billing information.

For shoppers, Shop Pay stores shipping and payment details, enabling one-click checkout. It’s Shopify’s answer to Amazon’s “Buy Now” convenience. Customers can also split payments with Shop Pay Installments in certain markets (currently more common in the US, but UK rollouts are gaining pace).

The biggest benefit? Conversion uplift. Faster checkouts = fewer abandoned baskets. In fact, Shopify themselves claim Shop Pay checkouts convert at a rate up to 1.72x higher than guest checkouts.

Key Differences Between Shop Pay and Shopify Payments

• Function: Shopify Payments = gateway. Shop Pay = checkout accelerator.
• Fees: Shopify Payments handles the fees. Shop Pay does not add new charges.
• User Experience: Shopify Payments is invisible. Shop Pay is highly visible to customers at checkout.
• Impact: Shopify Payments affects your operational costs. Shop Pay affects your conversion rate.

Benefits of Using Shopify Payments

• Integrated into your Shopify account: no third-party gateway headaches.
• Lower fees vs third-party providers (no extra 2% Shopify surcharge).
• Multi-currency support for cross-border selling in the UK and EU.
• Quicker payouts, typically 3 working days in the UK.

For serious growth, the advantage lies in keeping everything within one ecosystem. It simplifies reporting and reduces friction when scaling.

Benefits of Using Shop Pay

• Conversion boost: one-tap checkout reduces friction.
• Trust factor: UK shoppers are more willing to buy when checkout looks secure.
• Installments: split payments (especially appealing for high-ticket home and lifestyle products).
• Eco-angle: Shopify markets Shop Pay as the “first carbon-neutral checkout,” which increasingly resonates with UK consumers.

Do You Need Both Shop Pay and Shopify Payments?

Here’s the catch: Shop Pay only works if you enable Shopify Payments. You can’t activate Shop Pay without Shopify’s own gateway running in the background.

So the real question isn’t “either/or” it’s whether you’ll get more out of Shopify Payments than a third-party gateway. For most UK merchants we work with, the answer is yes. Unless you have a niche requirement, Shopify Payments + Shop Pay together will give you the best balance of cost-efficiency and conversion.

Which One is Right for Your Store?

If you’re a UK brand selling domestically, Shopify Payments is almost always the smarter option it saves you the 2% surcharge Shopify applies to third-party gateways.

If you’re a cross-border brand scaling into the US or EU, Shop Pay becomes your silent conversion weapon. It smooths out the international checkout experience and keeps impatient customers from dropping out.

But if you’re still running high-growth numbers on PayPal alone? You’re probably leaving sales on the table.

Common Misconceptions About Shop Pay vs Shopify Payments

• “They’re the same thing” – Wrong. One’s a gateway, one’s a checkout accelerator.
• “Shop Pay adds extra fees” – It doesn’t. Fees are all handled by Shopify Payments.
• “Shopify Payments isn’t worth it in the UK” – Untrue. Fees are competitive, and removing the extra Shopify transaction charge makes a huge difference to margins.

How WIRO Can Help

At WIRO, we’re blunt about payments: most merchants underestimate the cost of getting it wrong. A poorly optimised checkout can cost you more than high-ad spend or weak SEO.

We’ve worked with UK brands like Avery Row and Drop Deads, where even small tweaks to payment set-ups improved conversion and cash flow. Our role is to help you see the bigger picture: Shopify Payments isn’t just about saving on fees; Shop Pay isn’t just a button they’re levers for growth.

If you’re an ambitious merchant, your next competitive advantage won’t come from another 10% off voucher. It’ll come from making your checkout the smoothest in the room.

Conclusion

The verdict is simple: Shopify Payments runs the money. Shop Pay runs the checkout. Together, they form one of the strongest payment ecosystems in UK eCommerce today.

Ignore them, and you’ll bleed margin and frustrate your customers. Embrace them, and you’ll build a faster, leaner, more trustworthy checkout flow that pays for itself.