Blog Menu

I write and curate content for Bluehost. I hope this blog post is helpful.
Are you looking at creating a blog, website or an online store? Bluehost has something for everyone. Get started today.

Over 4.4 million e-commerce entrepreneurs use WooCommerce for their WordPress websites. WooCommerce released its efficient payment solution in 2020 — WooCommerce Payments, also known as WooPayments. It’s a reliable replacement for third-party means of managing and accepting payments on online stores.

Should you use WooCommerce Payments/WooPayments for your e-commerce store?

Keep reading to learn about:

WooCommerce: How It Works

WooCommerce Payments

WooCommerce Payments: Advantages

WooCommerce Payments: Disadvantages

WooCommerce Payments: How To Set It Up

Final Thoughts: WooCommerce Payments — What You Need To Know

WooCommerce: How It Works

WooCommerce, owned by’s parent company, Automattic, is the most popular open-source e-commerce plugin for WordPress websites. It has over five million active installations. 

WooCommerce helps store owners set up an e-commerce store on the WordPress platform by offering standard functionalities like product display, price listing, shopping carts, checkout pages, online payment system, and delivery options. 

While several e-commerce plugin solutions are available on the market, WooCommerce stands at the top with 29% usage. That is due to how easy it is to start an e-commerce store with the plugin’s user-friendly interface and customization.

WooCommerce 101

WooCommerce is a freemium plugin. Just as with any other regular WordPress plugin, you need to install WooCommerce. 

To install the WooCommerce plugin, you need to:

  1. Login to your WordPress website.
  2. Go to Plugins in your dashboard.
  3. Select Add New from the list of options.
  4. Type WooCommerce in the search bar located in the right corner.
  5. Click Install Now to add WooCommerce to your WordPress plugins.
  6. Click activate and follow the prompts to set up your online store in a matter of minutes.

WooCommerce’s free plan contains features that help you manage store data and run a basic “add to cart and pay” shopping system. However, the plugin also offers more complex online store features via extensions — a variety of which aren’t free. 

These WooCommerce extensions empower you to run an effective e-commerce platform. There are bookkeeping, accounting, marketing, and search engine optimization (SEO)-related extensions, as well as many others that will make your e-commerce website even more productive and profitable.

Person happy with their shopping experience on an e-commerce store with WooCommerce Payments

Image Source

WooCommerce: Built-In Features

Among WooCommerce’s stand out native features are its inventory management, functional delivery, shipping structure, seamless checkout experience, and secure merchant accounts and credit card payment options such as:

These third-party payment methods provide their services through extensions installed to your WooCommerce plugin. However, most of these service providers redirect your customers to other websites during the purchase process, and all of them charge transaction fees of varying rates.

With the introduction of WooCommerce Payments, that doesn’t have to be the case. By providing your WordPress platform with native payment solutions, WooCommerce Payments helps you reduce the number of customers who abandon purchases midway because of stressful multi-website checkout processes.

But what exactly is WooCommerce Payments?

WooCommerce Payments

WooCommerce Payments is a payment processing system developed to serve WooCommerce stores. 

You can use it to process online business transactions right from your dashboard without visiting any third-party payment platform like Stripe and PayPal by Braintree.

With WooPayments, you can also accept and process credit cards directly in your store. Moreover, you can check the payment history, issue refunds when they fit your policy, and even offer discounts to customers who meet specific criteria. 

WooCommerce Payments: Pricing

The WooPayments plugin is free, so you don’t have to pay any monthly fees or setup fees. 

But you do have to pay PayPal by Braintree and Stripe’s transaction fees. They are the following: 

  • Domestic credit cards or debit cards — set at 2.9% + $0.30 for each transaction.
  • International credit cards or debit cards — set at 2.9% + $0.30 for each transaction. 

These payment gateways charge an extra 1% to 2% per international transaction due to currency conversion fees. The amount varies depending on your location. 

  • Disputes — $15 per lost dispute

The set transaction fees for European credit and debit cards is 1.4% +  €0.25 per transaction. The costs for the United Kingdom are slightly different, with a 1.4% + £0.20 fee per transaction. 

WooCommerce Payments on an e-commerce websit

Image Source

Keep in mind that the cost of Stripe’s fees is the same as long as you stay under $1 million in sales volume per year. 

WooCommerce Payments: Advantages

Essentially, WooCommerce payment gateway does everything a third-party gateway does and more. Here are some of the advantages of using WooCommerce Payments:

  • You can settle refunds and disputes and manage payments in your WordPress dashboard.
  • It lets you accept major credit cards and debit cards on your website rather than redirecting customers to various third-party websites.
  • You can control cash-outs to your bank account since WooCommerce Payments channels your earnings.
  • WooCommerce Payments reduces the duration and stress of the checkout process for your customers. 
  • The ease of payment potentially translates into more sales compared to a system that involves multi-website checkout pages.
  • WooCommerce Payments integrates with WooCommerce subscriptions. That empowers you to run subscription services on your website. You can activate, suspend, and cancel one or more subscriptions with ease. 
  • You can lock away parts of your website, make them available on paid membership plans, and manage payment data from a single dashboard.
  • With this payment processor, you have fewer accounts to manage for your online store and fewer passwords to remember. 
  • WooCommerce Payments’ integrated analytics give you better insights into key metrics regarding finances, conversion, traffic, and SEO. 

WooCommerce Payments provides a rare blend of business, website, and finance management. It empowers you to formulate strategies that support your business and website to increase efficiency and profit.

WooCommerce Payments: Disadvantages

While WooPayments bring such ease-of-use to the table, as with most things, it has its disadvantages. 

Here are some of the downsides to using WooPayments:

  • You could lose vital historical shopping and purchase data if you migrate from other third-party gateways to WooPayments. 

It’s currently impossible to import old payment data from third-party gateways into the new WooPayments. 

Person setting up WooCommerce Payments on their e-commerce website

Image Source

So if you have an existing WooCommerce powered store using a third-party payment gateway, you might want to hold off until importing data into WooPayments is possible.

  • There are also a limited number of acceptable currencies and cards, which means that for now, cards issued in some countries cannot make payments via the WooPayments gateway. 

That limits the scope of potential customers because your website may not accept some of their cards. 

WooCommerce Payments: How To Set It Up

Setting up your Woopayments account is easy. The setup process only takes a few minutes. However, before you set up an account, you should verify that the service is available in your country and that your preferred currency is supported. 

Your store also has to be backed by a registered business entity in a supported country. Whichever payment gateway you choose will securely hold the information you provide about your business. 

WooCommerce Payments: Requirements For Set Up

Here are the requirements to set up a WooPayments account:

  • Registered business in a supported country
  • PHP 7.0+
  • WordPress 5.0+
  • WooCommerce 4.8+
  • SSL certificate

After verifying that you have all the requirements necessary, you can download the WooPayments plugin from the official extensions store as a file on your computer. 

WooCommerce Payments: Set Up Instructions

After downloading WooPayments, follow these steps to install and activate the plugin on your WordPress website:

  1. Login to WordPress and go to Plugins in your dashboard.
  2. Select Add New from the options displayed.
  3. At the top of the screen, close to Add New, click Upload Plugin.
  4. From your local file system, select the file.
  5. Select Install Now from the drop-down menu. You’ll receive a “Plugin installed successfully” notification after installation.
  6. At the bottom of the page, click the Activate Plugin button. 
  7. After installing the downloaded plugin, follow the instructions to validate your business credentials with Stripe or PayPal. 
  8. Go to Payments and select Set Up to finish the verification procedure. 

Next, fill in the necessary fields in the verification form. After verifying your website with your payment gateway of choice, WooPayments will fully integrate with your WordPress website, and you’ll immediately be able to accept credit and debit card payments. 

Final Thoughts: WooCommerce Payments — What You Need To Know

With careful consideration, the advantages of using WooPayments far outweigh its disadvantages. 

When you integrate WooPayments with your WooCommerce store, you can provide an excellent checkout experience, ease your workflow, and manage your financial transactions right from your WordPress dashboard without visiting any third-party website.

WooPayments is the future for e-commerce stores. It’s easy to use, integrates with all WordPress websites using WooCommerce, and scales with the market’s demands.
Are you ready to take advantage of WooCommerce’s powerful tools to set up your online store? Get started with Bluehost’s WooCommerce Hosting today.

  • Tiffani Anderson

    Tiffani is a Content and SEO Manager for the Bluehost brand. With over 10 years experience across all facets of content and brand marketing, she strives to combine concepts from brand marketing with engaging content through the lens of SEO.

    University of North Texas
    Previous Experience
    Content Marketing, SEO, Social Media
Learn more about Bluehost Editorial Guidelines

Write A Comment