If your store uses Shopify Payments then how often Shopify payout determines how often you get paid. When you use Shopify, then what you actually get paid will be your earnings with all Shopify fees already dedicated.
Getting access to your payments fast is super important. Cash flow is the lifeblood of any business. Getting payouts frequently and reliably will ensure your business’ cash flow.
If you are dropshipping then the cash flow is probably more important than for eCommerce established businesses. You probably rely on fast payouts to ensure that you can fulfill orders.
This is the beauty of dropshipping. The constant cash flow allows you to start an online store with very little capital and you can simply re-invest your earnings to buy stock AFTER you’ve already made the sale.
The really big problems for drop shippers start when they have issues with payouts from Shopify or Paypal. It could mean that you do not have the cash flow to fulfill orders or wore still – you don’t have the funds to cover for refunds.
If you are buying ads on Facebook Ads or Google Ads then it become incredibly important that you keep tabs on your ROI and to make sure you do not run into cash flow problems.
I recommend you use an app like TrueProfit because it allows you to always see a snapshot of your REAL profit – that would be your profit that takes into account all your expenses – including Shopify fees, refunds and ad costs.
How Shopify Payments Work
I wrote a more detailed article about Using Shopify Payments vs Stripe and it is well worth reading through that to understand the difference. If you choose to use Shopify Payments then there are a few different components to how your payments work.
This depends largely on what features you enable within Shopify Payments. Shopify has a feature called “Accelerated checkouts”.
This allows users who have Apple Pay, Google Pay, Amazon Pay or Paypal accounts to checkout through Shopify with just a few clicks. This works especially well when a customer checks out using their phone.
Instead of the usual 3-step checkout process of Shopify, a customer will simply use their fingerprint on their phone or confirm their password to have the checkout automatically completed by Apple Pay, Google Pay, Amazon Pay or Paypal.
If you activated these accelerated checkouts on your store then some of your payments may NOT come from Shopify but from the 3rd party gateway
|Payment provider||Customer pays via…||You get paid by…|
|Shopify Payments||Shopify Payments||Shopify Payments|
|Shopify Pay||Shopify Pay||Shopify Payments|
|Apple Pay||Apple Pay||Shopify Payments|
|Google Pay||Google Pay||Shopify Payments|
|Amazon Pay||Amazon Pay||Amazon|
Only the payments that are made through Shopify Payments will be paid out according to Shopify’s payment schedule.
How Often Does Shopify Payout Your Earnings
How often Shopify pays out depends on your location. Shopify Payments operate slightly differently in different countries. It is currently available in 17 countries only and payouts vary from once every 2 days to once a week.
Here’s how often Shopify pay out based on your location:
|2 Business Days||3 Business Days||4 Business Days|
A business day refers to any day of the week between Monday and Thursday.
All your store’s earnings from Friday, Saturday and Sunday will be grouped together and usually paid out on the Monday.
You also have to take into account how long it takes your own bank to process the payments.
Another important consideration is if you are selling in a currency other than your local currency. In my case, I am in Australia and Shopify pays me in Australian dollars.
My store however is set up in US Dollar and USD is the currency I sell in worldwide.
This makes fees more complicated. Shopify will apply an exchange rate and a conversion fee when the actual payment is captured.
Issues With Shopify Pay Outs
If your store is selling quality products, you have a low refund rate and your customers are generally happy then you will have no issues.
However, if you start processing a lot of refunds or if you receive a lot of chargebacks then Shopify Payments will step in. As far as charge backs are concerned they want to make sure that you have enough money to cover these charge backs.
They will either place a hold on your account and lock a percentage of your earnings OR in the worse case scenario they will ban you from using Shopify Payments
This is quite common with dropshippers who sell low-quality products (resulting in refunds or pissed off customers after delivery) or whose shipping times are too slow.
The days of selling low quality products from China and taking 4 weeks to reach your customers are a thing of the past. If this is your business model then you won’t be able to use Shopify Payments (or any other gateway) for long.
If you are dropshipping, I would suggest you source products from the USA or see how you can get fast shipping for your dropshipping business.
With Shopify Payments, like all payment gateways you need to verify your account. This is basically an ID verification process to verify that you are who you say you are.
You only have 21 days to complete this. After 21 days Shopify will refund all your customers and automatically close your account – NO payments will be made to you.
How Often Does Stripe Pay Out
If Shopify Payments are not available in your country then Stripe is the obvious choice as a payment gateway. You simply prefer to use Stripe instead of Shopify Payments and there are many reasons for doing this.
Stripe has a slightly different process and while they also require verification, they will withhold your first payment for up to 14 days.
During this time they will access your business. This is mostly done via their algorithm but it could also involve a manual review. They are definitely cracking down on dodgy dropshippers so be warned.
Stripe pay out pretty much at the same schedule as Shopify Payments. They do give you some more options if you prefer to have payments on set dates each month. You can see this when you loog into your Stripe account under “Payout Schedule”.
How To Get Shopify Payments Faster
If cashflow is essential then you may want to get your Shopify payments faster – especially if you are based in a country where it takes more than 5 days to get your money.
In this case, I would recommend Paypal as your payment gateway. What I really love about Paypal is that you have access to your money almost immediately.
Once someone has made a purchase on your store you can log into your Paypal account and the funds are there and ready to be used.
Paypal does come with a lot of issues though so you need to be mindful of refunds and chargebacks as Paypal can be much stricter than Stripe and Shopify Payments as far as freezing your account.
Shopify Payouts Conculsion
How often does Shopify payout depends on a few variables and mostly depends on where you are based as the store owner. On top of that, Shopify Payments are not available in all countries.
In fact, it is only available in 17 countries, but Stripe has a very similar payout structure and they are available in 37 countries.
If you are selling in the USA, UK, Canada and Australia (the Big 4) and you are not based in any of those countries then you need to be aware of currency exchanges and fees.
One option you have when you sell predominantly in the USA is to set up an LLC in the USA and get yourself a local bank account. That will allow you to receive 2 day payouts from Shopify and you will pay minimal fees.
In the end you need to access your own cash flow situation, how much you are willing to pay on fees as well as the risk factors involved in using Shopify Payments, Stripe and Paypal.