What does Shop Pay Installments cost the merchant?

Shopify doesn't publish the rate — it's set per store. Third-party estimates cluster around 5.9% + $0.30 per order, with merchant reports as high as 7.99% + $0.30. The fee replaces your standard Shopify Payments card rate on instalment orders rather than adding to it, and it's charged once per order, not per instalment.

Does using BNPL affect a customer's credit?

Yes, BNPL can affect a customer's credit, depending on the provider and payment plan. Affirm reports all loans issued from April 1, 2025, including Pay in 4, to Experian, and that extends to Shop Pay Installments. Creating an account doesn't affect a score, but making a purchase and the subsequent payment history can.

Is BNPL interest-free for customers?

Pay-in-four plans are interest-free when payments are made on time. Longer financing isn't — Shop Pay Installments monthly plans in Canada run 0–31.99% APR depending on the customer's eligibility. Only describe your instalment option as interest-free if you mean the short plans.

What happens to the merchant fee when a BNPL order is refunded?

With Shop Pay Installments, the transaction fee isn't returned when you refund an order. The customer's payment plan is adjusted by the provider, but the fee you already paid stays paid. The same applies with Affirm and with standard card processing, so it isn't a Shopify quirk — check your agreement for the provider you use.

Which BNPL providers work with Shopify stores in Canada?

Canadian Shopify merchants can use Shop Pay Installments, PayPal Pay Later, Klarna, Sezzle, Afterpay, and Affirm. Order limits run from $30 CAD at the low end to $30,000 CAD on Shop Pay Installments, so the right choice mostly comes down to what your products cost. Shop Pay Installments is the only one that needs no app.

Which products can't use BNPL?

On Shop Pay Installments, gift cards and subscription products are excluded, and you can't opt individual products in or out — it applies to everything in the eligible price range. Other providers commonly restrict digital goods, alcohol, and gambling-related products.

What happens if a customer stops making BNPL payments?

If a customer stops paying, the BNPL provider collects the remaining instalments. The merchant keeps the settlement already received. Afterpay and Klarna charge late fees up to 25% of the purchase amount; Shop Pay Installments charges none.