If you’re selling physical products online, choosing the right payment gateway can make or break your customer experience.
A good payment gateway builds trust, handles transactions securely, and helps you get paid quickly. The wrong one? It can cause abandoned carts, payout delays, and even hurt your store’s reputation.
When I launched my first ecommerce store, I didn’t think too much about payment processors. I picked what was easiest and ended up dealing with hidden fees, slow transfers, and frustrated buyers. Since then, I’ve tested most of the big names and learned what actually works for small businesses selling physical products.
In this guide, we’ll look at the 6 best payment gateways for physical products, covering transaction fees, ease of use, integration options, and which ones are best depending on your store setup.
1. Stripe
Stripe is a top choice for modern ecommerce businesses. It integrates with most platforms (including Shopify, Payhip, and WooCommerce), and it’s trusted by startups and enterprise brands alike.
Key features:
- Accepts all major debit and credit cards
- Supports Apple Pay, Google Pay, and international currencies
- No monthly fees, just per-transaction charges
- Built-in fraud detection and easy refund management
Best for: Online sellers who want a flexible, developer-friendly option with strong global support.
Fees: 2.9% + 30¢ per transaction (U.S. rates)
2. PayPal
PayPal is one of the most trusted payment gateways in the world especially for first-time buyers. Many customers already have PayPal accounts and prefer using it for fast checkout.
Key features:
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Offers Pay Later options for buyers
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Built-in buyer and seller protection
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Compatible with most ecommerce platforms
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Lets you create invoices and send money directly
Best for: Sellers who want an instantly recognizable and trusted checkout option.
Fees: 2.9% + fixed fee based on currency; extra for currency conversion
3. Square
Square is ideal for businesses that sell online and in-person. It’s great for pop-ups, local markets, or retail locations with an online presence.
Key features:
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All-in-one solution for payments, POS, and ecommerce
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Syncs online and offline inventory
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Free online store builder included
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Easy-to-use mobile card reader
Best for: Sellers combining physical retail and online sales.
Fees: 2.6% + 10¢ for in-person, 2.9% + 30¢ for online transactions
4. Payhip Payments (via Stripe or PayPal)
Payhip is a platform designed for digital and physical product sellers. It integrates directly with both Stripe and PayPal — meaning you don’t need to worry about complicated third-party setups.
Key features:
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Built-in checkout and payment processing
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Supports physical, digital, and subscription products
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Handles taxes and product delivery automatically
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No monthly fees on the free plan
Best for: New sellers who want a fast, low-effort way to start selling physical products.
Fees: Based on Stripe or PayPal rates; Payhip also charges a platform fee on the free plan (5%)
5. Shopify Payments
If your store runs on Shopify, using Shopify Payments is the most seamless option. It’s built directly into your dashboard and powered by Stripe behind the scenes.
Key features:
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No third-party integrations required
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Eliminates extra transaction fees when used with Shopify
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Supports credit cards, Shop Pay, and accelerated checkouts
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Fully PCI compliant and secure
Best for: Shopify users who want an all-in-one system with minimal setup.
Fees: 2.9% + 30¢ per transaction (basic plan); lower with higher plans
6. Authorize.net
Authorize.net is a robust, reliable option for established sellers who want maximum control over payment processing. It’s owned by Visa and known for its advanced security.
Key features:
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Accepts cards, e-checks, and recurring payments
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Works with most major ecommerce platforms
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Customizable fraud protection tools
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Supports integrations with accounting software
Best for: High-volume sellers or businesses that need advanced payment features.
Fees: $25 monthly fee, plus 2.9% + 30¢ per transaction
What to Look for in a Payment Gateway for Physical Products?
Before choosing a provider, consider these factors:
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Transaction fees: Understand both flat rates and percentage fees
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Payout speed: How quickly you receive your funds matters for cash flow
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International support: If you sell globally, make sure currencies and languages are supported
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Customer trust: Choose gateways your buyers already know and trust
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Platform compatibility: Make sure your payment provider integrates smoothly with your ecommerce platform
You’ll also want to factor in other operational needs like managing inventory for small businesses and setting up shipping and delivery options which go hand-in-hand with how you collect payments and fulfill orders.
Conclusion
The best payment gateway for physical products depends on your business model, budget, and customer base. If you want a quick setup with broad support, Stripe or PayPal are excellent. If you’re using Shopify or Payhip, their built-in systems will save you time. For in-person sales, Square offers unmatched flexibility.
And don’t forget to align your choice with how you price your physical products and handle taxes on physical product sales. These backend decisions can make a huge difference in your profit margins and customer satisfaction.
Start with one that fits your current needs, then expand as your store grows. Payment processing doesn’t need to be complicated — it just needs to be reliable.
