How to activate Shopify Pay Installments in 2 Minutes?

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Have you heard Shopify installment payments boost sales and customer satisfaction? RBC Capital Markets says point-of-sale loans increase retail conversion rates by 20%–30% and ticket sizes by 30%–50%. Customers reluctant to buy may convert when allowed to pay in installments.

This article will describe Shopify's installment plans and the strategies, tactics, and psychological triggers that make them revolutionary. If you're an eCommerce veteran or just starting, these tips will help you make better decisions.

What Is Shopify Pay Installments?

What Is Shopify Pay Installments

Shopify Pay Installments is a flexible and simple payment option. It lets buyers pay for products in smaller, more affordable installments:

  • For sales between $50 and $999.99, you can make four payments every 2 weeks with no interest.
  • Monthly payments for $150–$17,500 purchases. Depending on the purchase amount, monthly installment orders carry 10–36% APR and may be paid in 3, 6, or 12 months.

This feature revolutionizes the conventional approach to online purchases, making high-value items more accessible to a broader spectrum of customers.

How Does Shop Pay Installments Work?

When customers choose Shopify Pay Installments at checkout, the purchase price is split into equal or customizable installments. 

The first payment is made upon purchase, and subsequent installments are automatically withdrawn. Catering to varied financial preferences makes purchasing more accessible for customers and gives firms a competitive advantage.

About Shop Pay Installments Premium

The prominent e-commerce platform Shopify offers Shop Pay Installments Premium:

  • Customers may make 4 equal installments, with the first payable upon purchase and the other 3 automatically charged every 2 weeks. 
  • Payments without interest for 12 months. 
  • Up to 24 months of monthly payments on orders between $50 and $17,500.

This service is offered to US Shop Pay clients who satisfy specific requirements. Shop Pay Installments Premium lets consumers pay for items without interest or fees over time.

How Can Shopify Sellers Benefit from Shop Pay Installments?

In eCommerce, a Shopify seller's success depends on sales, customer base, cart abandonment, and customer loyalty. Shop Pay Installments transforms your company in all ways:

Increased Sales

Increased Sales

Every business owner understands that money comes from people clicking to purchase. However, particularly for pricey things, buyers hesitate to buy.

According to a Harvard Business Review research, installment programs boost customers' willingness to pay and decrease their price sensitivity. By making smaller installments, buyers may afford things previously beyond their reach.

Credit Karma found that 44% of customers had used Buy Now, Pay Later (BNPL) to buy anything.

Shop Pay Installments may boost consumers' buying power by accepting installment payments. Regarding often-cost things, 56% of buyers wanted an installment option that would enable them to pay for expensive products over time. This may boost premium product sales and expand the firm's client base.

In a Qualtrics poll for Credit Karma, 44% of Americans utilized buy now, pay later products to purchase an item, up from December 2020. In addition, 75% of BNPL customers have used them again, suggesting they were happy enough with their initial experience to return.  

Customers may buy more expensive things or repeat transactions if they can stretch the payments. This may boost company sales and order values.

Expanding the Customer Base

Expanding the Customer Base

Offering installment payments suits customers' different financial situations. Customers with variable income, erratic cash flow, or particular financial objectives might use installment alternatives to fit their purchases with their financial circumstances.

Research from the October University for Modern Sciences and Arts indicated that providing payment plans improved customers' purchase intentions, especially for higher-priced products. Businesses may make products more accessible by offering flexible payment options that eliminate the requirement to pay in full. 

Because installment purchasing is not confined to a single business, it has spread across various industries, including fashion, electronics, home products, and travel. This broadens the audience for the items and boosts their marketability.

Significantly, younger generations like millennials and Gen Z would instead make payments over time. Klarna found that millennials and Gen Z appreciate flexibility and cost, making installment payment alternatives attractive. So, seller Shopify might attract younger clients by providing payment options.

Reducing Cart Abandonment

Reducing Cart Abandonment

Many companies struggle to decrease shopping cart abandonment rates. The Baymard Institute found that online shopping cart abandonment averaged 70.19% across sectors. There weren't enough payment options for 11% of them.

Offering pay installments as a payment option is a viable solution to this problem. You may boost clients' buying power and lower prices by letting them pay in smaller installments.

Pay installments boost client trust, particularly for more significant transactions. By breaking down the cost into smaller installments, buyers may feel more confident in their ability to afford it. This reduces cart abandonment by lowering hesitancy and increasing transaction chance.

Building Customer Loyalty

Building Customer Loyalty

Shop Pay Installments makes purchasing more versatile and easy by allowing consumers to pay in installments. 

Milo's infographic demonstrates that 56% of respondents anticipate many payment alternatives at checkout. This good experience may boost client loyalty. Spending over time makes things more inexpensive and accessible; therefore, customers like it.

If consumers use Shop Pay Installments and have a good experience, they are more inclined to buy from that merchant again. The Invesp study found a 5% to 20% success rate in selling to new customers. However, that percentage may rise to as high as 70% when selling to loyal clients. Customers may make more purchases utilizing Shop Pay Installments, knowing they can quickly pay.

How To Accept Installment Payments in Your Shopify Store?

How To Accept Installment Payments in Your Shopify Store

You may provide installment payments using Shopify Payments. If you don't use Shopify Payments, you may still provide payment plans to your consumers using a third-party source.

Check Your Eligibility

Affirm powers Shop Pay Installments. Affirm frequently checks your online shop once you enable Shop Pay Installments to ensure compliance with their banned business policy. 

Shop Pay Installments Eligibility requires US residency, USD sales, and Shopify Payments and Shop Pay activation. You'll find Shop Pay Installments under your Shopify store's Payments options.

If you violate the rules, your Shop Pay Installments account will be stopped, and you will get a message in your admin.

Allow Shop Pay Installments

The first step is to turn on the Shop Pay Installments option in your Shopify admin. 

  • Select Settings > Payments in your Shopify admin panel to verify. 
  • Make sure Shop Pay Installments are enabled.
  • After that, Click Manage under the Shopify Payments section.

Allow Shop Pay Installments

  • Check Shop Pay Installments in the Shop Pay column, then click Save.

Allow Shop Pay Installments

In case you haven't already, add Shop Pay as a payment option to your Shopify shop. 

  • Go to Settings > Payments and scroll down to Alternative Payments. 
  • Then, click "Choose alternative payment" and choose Shop Pay. 
  • Follow the instructions to finish the setup.

Display Installment Information

Make sure your consumers understand the terms of any installment payment plans you may provide. Include installment choices on product, basket, and checkout pages. Customers realize they may pay in installments and the terms and conditions.

Pro Tip: Merchants may quickly design any page type or segment with EComposer Landing Page Builder's live drag-and-drop editor. 

  • Theme sections, including the Landing, Home, Collection, Product, Blog, Cart, Coming Soon, and 404 pages, as well as the whole theme, are supported. 
  • Increase sales using third-party applications with built-in extensions and save time and money. 
  • With EComposer speed-up tools and optimized programs, storage speed is no issue.

Please follow 4 simple steps:

1. Install EComposer Landing Page Builder from the Shopify App Store.
2. From the EComposer Builder Dashboard > Landing & Pages > Create Pages.

    Display Installment Information

    3. Under the EComposer Builder Dashboard, click on the Shopify section and drag-drop the "Payments Methods" option to the location on the page you want.

    Display Installment Information

      4. Then, you can Customize the payment method that suits your store. 

      Display Installment Information

        Test and Monitor

        Testing the functionality once you've set up installment payments is critical to verify that everything is running correctly. To ensure clients can use installment payments, finish purchases, place test orders, and proceed through checkout. So, check the payment process and resolve difficulties.

        Here's how to implement Shopify's installment payment plan to provide your customers with a convenient new way to pay for their purchases.

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        Way to Enable Shop Pay Installments for Shopify POS

        Innovative payment options are essential for retailers looking to improve in-store buying as the industry evolves. With third-party payment gateways, you may enable Shop Pay's fast checkout on your online shop, Facebook, and Instagram.

        1. Navigate to your Shopify admin and then to Settings > Payments.
        2. Then, under your third-party payment provider's area, select the Manage option.
        3. Check Enable Shop Pay and click Save under Shop Pay.
        4. After that, click on Complete Setup, and then enter all of your store's and financial information. When finished, click the Save button.

        Remember: 

        • If you activate Shop Pay without finishing the set-up, you must do it within 21 days of receiving your first Shop Pay payment.
        • If you do not finish the setup within 21 days, all Shop Pay payments will be immediately reimbursed to the appropriate clients.

        Tips for Shop Pay Installments Success

        Tips for Shop Pay Installments Success

        It's not enough to enable Shop Pay Installments—you need to use them to boost your Shopify store's success carefully. 

        Let's examine how these important factors might boost sales, customer happiness, and growth in eCommerce's ever-changing market. This part covers four critical pillars: choosing the right installment payment products, creating effective pricing strategies, and implementing robust monitoring and optimization practices:

        Select Right Installment Payment Products

        Select Right Installment Payment Products

        Remember that Affirm may do random checks of your shop if you're utilizing Shop Pay Installments to ensure you're not operating a forbidden business. 

        Installment payments using Shop Pay may be temporarily disabled if your shop is determined to violate its rules. Instances where your Shop Pay Installment account may be frozen include, but are not limited to:

        • A password protects your online shop.
        • Not USD is your store's primary currency.
        • English is not your store's first language.
        • Your Shopify shop does not have an active internet presence.
        • Your company provides B2B services.
        • Your shop is in gambling, financial services, or another Affirm-unsupported industry.

        A critical step is determining which goods to offer via this appealing payment option. Consideration and strategic planning are essential for guaranteeing a smooth and effective deployment. 

        Here is a highlighting of popular items for installment purchases:

        • Best-Sellers and Trending Products: Consider payment plans for your best-selling and trending articles. These things are popular, so offering flexible payment options may enhance sales.
        • Seasonal and Limited-Edition Items: Installment arrangements may emphasize urgency and exclusivity for seasonal or limited-edition items. Spreading the cost over time may encourage customers to buy these things.

        Pricing Strategies for Installment Plans

        Pricing Strategies for Installment Plans

        Internet buyers are more price-conscious and well-informed due to their product search skills, according to ResearchGate (Hoffman and Novak, 1997).

        To attract clients and boost eCommerce sales, you need smart installment plan pricing tactics. You may create a win-win situation for your company and clients by knowing customer preferences and using effective methods.

        Determining Competitive and Attractive Price Points:

        • Market Analysis: Research your rivals' prices for comparable items with payment plans. Understanding the competition helps you price competitively.
        • Balancing Affordability and Profitability: Balance consumer affordability with corporate profitability. Maintaining competitive installment costs while reaching financial objectives is crucial.

        Pro tip: Use The4 Toolkit to enable Compare and Wishlist capabilities for Unsen, Kalles, Gecko, and other The4 themes. These features improve the shopping experience by enabling consumers to compare goods quickly and build wishlists for future purchases.

        The4 Toolkit

        By implementing Compare and Wishlist capabilities, you not only give essential tools to consumers, but also promote interaction, which may lead to more excellent sales and customer loyalty.

        The4 Toolkit's Compare and Wishlist

        Monitoring and Optimization

        Monitoring and Optimization

        The objective is to convert data into information and information into insight. - Carly Fiorina, former Hewlett-Packard CEO.

        Pay special attention to the percentage of clients who quit their carts after seeing the payment terms for the installment plan. Deal with process pain spots and patterns.

        BrightLocal found that 91% of 18-34-year-olds trust internet reviews as much as personal recommendations. Collect firsthand feedback from clients who have utilized installment payments. Listening to what they say about their experience and where they may improve can be helpful.

        Use data analytics technologies to acquire a better understanding of consumer behavior. Recognize trends or patterns in how various client categories interact with installment alternatives. 

        Various data analytics tools and technologies meet different demands and preferences. Some popular ones:

        Marketing and Promoting Installment Payments

        Installment payments improve eCommerce strategies, but they need good marketing. Create awareness and encourage clients to use this easy payment method by highlighting the advantages across platforms.

        Showcasing installment options on your website:

        Homepage Highlights

        Make installment payment choices visible on your homepage. Display ads, sliders, or call-to-action buttons to alert visitors to this flexible payment option.

        A nice illustration of how to highlight a flexible payment option is provided by Wayfair, a well-known online furniture and home products shop.

         Wayfair

        (image source: wayfair.com)

        A big banner ad or area on Wayfair's homepage advertises installment payments for furniture, home décor, and other goods. This site uses appealing images and clear text to remind visitors that Wayfair offers payment plans. Wayfair's call-to-action buttons encourage visitors to investigate installment payments or buy utilizing this flexible payment arrangement.

        Product Pages Integration

        Add monthly payment details to product pages. Spread the word that buyers may make payments over time, making the product more affordable and encouraging more transactions.

        The website "Apple" inserts monthly payment data into its product pages to make things more cheap and promote additional transactions. To encourage consumers to pay over time, Apple, a computer giant, displays monthly payment information on its product sites.

         Apple's product

        (image source: apple.com)

        On Apple's website, product listings for iPhones, MacBooks, and iPads commonly provide monthly payment alternatives. This section usually includes the monthly installment amount, payment plan length, and financing options. Apple clearly conveys the cost of its goods via installment payments on product sites, promoting more transactions and making its high-quality gadgets more accessible to more people.

        Checkout Page Clarity

        Make sure that payment plans are highlighted prominently on the final bill page. Communicate with consumers using clear and direct language to win their confidence and allay their concerns.

        The website Expedia is a good example. It prominently displays payment options on the final bill page in simple language to earn users' trust. Expedia frequently clearly states payment plans and installment alternatives on the final bill page of vacation lodgings or packages.

         Expedia checkout

        (image source: expedia.com)

        Expedia successfully engages with customers by emphasizing payment plans and installment alternatives on the final bill page. The wording is plain and unambiguous to reassure people about purchasing big vacations. Clear communication helps customers understand their payment alternatives and feel more secure about their transactions, increasing trust and happiness.

        FAQs

        1. Does Shopify's Store Pay Installments Install Automatically?

        No, it isn't. Update January 2023: Shopify's Shop Pay Installments don't install automatically for all shops. Stores need to apply and be authorized to accept Shop Pay Installments. 

        The part above this piece has instructions on how to set up Shopify's Store Pay Installments. Please scroll up to read them.

        For the latest information and guidance on activating Shop Pay Installments for your Shopify shop, contact Shopify support.

        2. How Can I Disable Shopify Business Pay Installments For Certain Products?

        To deactivate Shopify Business Pay Installments for particular items, follow these steps:

        1. Enter your Shopify admin dashboard and click "Settings" in the bottom left corner.
        2. Then, choose "Payments."
        3. Find the alternative payment or financing area. Look for Shop Pay Installments here.
        4. Configure or change installment payment arrangements here.
        5. Save your choices to deactivate Shop Pay Installments for selected purchases.

        Note: Some Shopify versions let you exclude goods from installment payments. Check Shop Pay Installments' product management or exclusion options.

        3. Why Am I Not Eligible For Shop Pay Instalments?

        Different conditions apply to Shop Pay Installments depending on Shopify's regulations and financial service providers. We can't confirm your eligibility, but here are some typical reasons a merchant may not be qualified for Shop Pay Installments:

        • Country of Operation: Not all nations provide Shop Pay Installments. Regulations and banking institution agreements limit the service's availability to some locations.
        • Merchant Compliance: Merchants may need to follow Shopify's regulations to use Shop Pay Installments. Infractions of Shopify's TOS or merchant rules may impact eligibility.
        • Type of Products Sold: Shop Pay Installments may not work for specific items or sectors. High-risk or prohibited items may affect eligibility.
        • Business History longevity may be a factor. Before qualifying, new firms may require a track record of trustworthy transactions.
        • Financial Stability: Business creditworthiness and stability may be assessed. This may contain the company's income, financial history, and credit score.
        • Shopify Plan: Shop Pay Installments depend on your Shopify plan. Plans may limit services like financing.
        • Shopify Account Standing: Shopify account concerns like unpaid payments or disputes may affect your eligibility for some services.

        Contact Shopify Support for details on your eligibility and reasoning.

        4. How Do Refund Shop Pay Installments Orders Work?

        Giving back an order that was paid for in Shop Pay Installments. When you give a refund, the Shop Pay Installments purchase fee is not repaid.

        When you return an item bought with Shop Pay Installments, you send the customer their money back. If a customer asks for a refund on an order that they have been making monthly payments on, they will not get their interest back. Interest is what you pay to borrow money, and you can't get it back.

        The Bottom Line

        In eCommerce, new payment methods are essential to keeping ahead. Shopify's Shop Pay Installments functionality boosts revenue, customer acquisition, and cart abandonment. As said, strategically implementing and promoting installment payments may transform your Shopify shop.

        Moreover, marketing is simpler than ever for Shopify companies with EComposer Builder. EComposer's drag-and-drop feature lets you construct appealing landing pages, illustrate installment alternatives, and engage customers. Also, EComposer enables you to create visually attractive and conversion-friendly shopping experiences by promoting deals or developing personalized installment benefit sections.

        Ready to Transform Your Shopify Store? Explore EComposer's Power Today!




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