Do shoppers visit your website, decide to buy a product, but leave just before payment? You’re not alone; it’s the everyday reality for almost every Indian Shopify business. Wondering why?
Well, a majority of Indians don’t shop like they used to. Instant and flexible modes like UPI, EMI, and net banking have replaced traditional cash and card payments. But several Shopify payment gateway providers seem to have missed the memo.
To add to this challenge, some of them aren’t aligned with RBI’s compliance requirements.
As such, there are several other payment bottlenecks Indian businesses face on Shopify. But not anymore! Here’s your practical playbook for understanding and overcoming them.
The high stakes of Shopify payment challenges
Most Shopify payments in India die on the vine. But it’s not just lost sales; the stakes are much more serious:
1. Collapsed revenue
Your Shopify store’s design could be top-notch. Its UX? Flawless. Yet, even a single hiccup in its payment infrastructure can hit you where it hurts most – your revenue.
Here’s why: payments are the final step before revenue. If a shopper struggles here, they are likely to drop off. And before you know it, your Shopify store’s revenue could hit zero.
2. Damaged trust
In the short run, a single UPI payment failure or downtime is just a lost conversion opportunity that you can eventually recover from. But if not corrected, these issues can pile up to hurt your brand image. That’s something difficult to reverse.
3. Blocked growth
Beyond payments, an inefficient Shopify payment gateway can also mess up refunds, EMIs, and settlements. That means more support tickets for your team, added operational headaches, and ultimately, stalled growth.
7 common Shopify payment challenges in India
Here are seven major pitfalls that hamper payments on Shopify, specifically for Indian businesses:
1. Failed UPI transactions
UPI is a popular payment method in India, largely due to its convenience. However, when a customer makes a UPI payment, the transaction goes through several steps involving different banks.
If there is a problem at any point, such as a server outage or network issues, the transaction can fail.
| Solution:Choose a Shopify payment provider that offers multiple UPI rails, so payments don’t fail if one bank server is down. Combine it with auto-retry to instantly re-attempt failed transactions, saving the shopper from restarting the checkout. |
2. Poor payment UX
In India, many shoppers will abandon their cart if the payment process is confusing or takes too long. UX issues, such as too many steps, unclear instructions, or excessive redirects to different pages, can be frustrating.
So, shoppers often just give up instead of finishing their purchase. This leads to high cart abandonment rates.
| Solution: Enable one-click UPI and saved cards for faster checkout. Additionally, choose a payment gateway with a mobile-first design since most Indian shoppers pay via their phones. |
3. Limited payment options
Another major challenge for Shopify merchants in India is the limited payment options. Shopify’s built-in payment processor, Shopify Payments, isn’t available in the country.
Additionally, various third-party Shopify-supported gateways don’t support popular local payment options like UPI, EMI, and BNPL, discouraging shoppers from becoming customers.
| Solution: Pick a Shopify payment gateway in India that supports local methods like UPI, net banking, and wallets. Also, ensure multi-bank partnerships to reduce dependency on a single rail. |
4. Settlement delays
Shopify payments in India usually take 3-5 days to settle. This delay can strain cash flow, making it harder for merchants to restock inventory, pay suppliers, or manage daily operations.
| Solution: Go with gateways that settle funds in 24 to 48 hours. Faster settlements improve cash flow and keep operations running smoothly. |
5. Refund & EMI failures
Poor API sync and compliance gaps often disrupt communication between payment gateways, banks, and Shopify. For Indian Shopify businesses, this can lead to failed EMIs, delayed refunds, and broken transactions, frustrating shoppers and creating operational headaches.
| Solution: Choose gateways that automate refunds and validate EMI plans upfront. This prevents disputes and reduces support load. |
6. Downtime during peak sales
Certain Shopify payment gateways in India experience severe downtime, particularly during peak sales seasons such as Diwali and the New Year. The reason is poor load balancing, which causes pages to slow down or crash when servers get overloaded.
As a result, merchants suffer significant revenue loss during high-demand periods.
| Solution: Select gateways with auto-failover and ISO-certified reliability. This ensures payments keep flowing even during heavy traffic. |
7. Weak fraud protection
Last but not least, weak fraud detection in payment gateways is another big challenge for Indian Shopify stores.
Without safeguards like PCI-DSS compliance, tokenisation, or fraud filters, you risk fake transactions, chargebacks, and data security issues. This can result in lost revenue, increased fees, and eroded customer trust.
| Solution: Opt for gateways with velocity checks and device fingerprinting. These tools detect suspicious activity early and protect both your store and customers. |
Common mistakes merchants make when addressing payment challenges
Ready to fix your Shopify store’s payment issues? Here are a few common mistakes you’ll want to avoid:
1. Ignoring UX
Merchants have to pay a fixed percentage of MDR (Merchant Discount Rate) on every transaction processed by their online payment gateway. So naturally, they look for providers with low MDR. However, this often comes at the cost of poor UX, which frustrates shoppers and leads to abandoned carts.
2. Overlooking UPI & EMI support
Indian shoppers love UPI and EMI. If your store doesn’t offer them, you risk losing sales to competitors who do.
3. Avoiding refund/settlement testing
Many Shopify merchants only test payment flow and transaction success/failure handling, while neglecting refunds and settlements before going live. But flaws in these areas can delay payouts or cause failed refunds, directly hurting customer satisfaction and trust.
4. Neglecting SLA terms
Many merchants ignore SLAs, thinking issues won’t happen or can be handled later. But without guaranteed support, a gateway crash during peak sales like Diwali can leave you stranded as orders pile up, shoppers get frustrated, and revenue slips away.
Solving Shopify payment challenges for seamless scaling
Shopify payment challenges aren’t unbeatable. You just need the right gateway strategy. That means a setup that can handle UPI failures, poor UX, limited options, settlement delays, refund/EMI hiccups, downtime, and weak fraud protection.
Get this right, and your payment infrastructure will become stronger, leading to fewer drop-offs, smoother cash flow, and happier customers.
Looking to eliminate Shopify payment challenges, once and for all? Explore Pine Labs Gateway, a Shopify payment gateway built for UPI, EMI, and scale-ready reliability.
Hurry up! Get in touch with us today.