Setting Up PayPal for Your Magento Store

Table of Contents

Note: This article provides information about how to set up PayPal in Magento Enterprise Edition (EE). The information is based on EE 1.13; some options here might not apply to earlier versions. For instructions on setting up PayPal for previous versions, see Setting Up PayPal for Previous Versions of Magento later in this article.

Overview

PayPal is a global leader in online payments and a fast and secure way for your customers to pay online. With PayPal and Magento, you can accept payments from all major debit and credit cards, and PayPal account holders. Since customers don't even need a PayPal account to pay with PayPal, both you and your customers can get extra convenience without extra effort.

PayPal Express Checkout

Express Checkout helps boost sales by giving your customers the ability to pay by credit card or from the security of their personal PayPal accounts. During checkout, the customer is redirected to the secure PayPal site to complete the payment information. The customer is then returned to your store to complete the remainder of the checkout process. Choosing Express Checkout adds the familiar PayPal button to your store, which has been reported to increase sales.*

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Customers with current PayPal accounts can make a purchase in a single step, by clicking the “Check out with PayPal” button. If you already accept credit cards online, you can offer Express Checkout as an additional option to attract new customers who prefer to pay with PayPal. PayPal Express Checkout can be used as a stand-alone, or in combination with one of PayPal’s All-in-One solutions.

Requirements

Checkout Workflow

With Express Checkout, your customer is redirected to the PayPal site to complete the transaction.

PayPal Express Checkout Workflow
PayPal Express Checkout Workflow

Step-by-Step Instructions

For detailed, step-by-step instructions, see the following topic:

PayPal All-in-One Solutions

PayPal offers a variety of PCI-compliant solutions to meet the needs of your growing business. For information about the PayPal all-in-one solutions for Magento Enterprise Edition (EE) 1.13, including detailed step-by-step setup instructions, see the following topics:

  • Setting Up PayPal Payments Advanced (EE) - includes Express Checkout: PayPal Payments Advanced offers your customers a secure checkout experience without leaving your site. Flexible templates and a low monthly fee make this an ideal choice for merchants who want to create a more customized checkout experience.
  • Setting Up PayPal Payments Pro (EE) – includes Express Checkout: PayPal Payments Pro brings you all the benefits of a merchant account and payment gateway in one, plus the ability to create your own, fully customized checkout experience.
  • Setting Up PayPal Payments Standard (EE): PayPal Payments Standard is the easiest way to accept payments online. You can offer your customers the convenience of payment by credit card and PayPal by simply adding a checkout button to your site. During checkout, customers are redirected to PayPal to complete the payment part of the checkout process. There are no lengthy applications to complete, or monthly charges to set up in advance. When you make your first sale, PayPal will guide you through the process of setting up your account.

Setting Up PayPal for Previous Versions of Magento

Applicable to: CEv1.4.1+, EEv1.9 to v1.12.0.0

Important: If you are using an API Certificate as the API Authentication Method, you will need to import a new certificate for your store by August 6, 2013. PayPal has upgraded to 2048-bit key length SSL certificates, and your certificate may be out of date. For more information, see this post from PayPal.

Magento allows you to easily use a variety of payment gateways and methods in your online store. Many are already integrated into Magento and you can enable and configure them right from the Magento Admin panel--no coding required! Starting with Magento CE v1.4.1.1 and EE v1.9, PayPal was further integrated into the Magento platform. The following enhancements and changes have been made to the PayPal payment methods available in Magento.

  • New interface for selecting PayPal payment methods is available in the Admin Panel.
  • PayPal payment methods are grouped on a separate tab in the system configuration section of the Admin Panel.
  • Website Payments Pro and Website Payments Pro Payflow Edition are integrated into one PayPal module.
  • Links to PayPal landing pages are available in the Admin Panel to help you research your payment options.

This article walks you through the PayPal configuration section and options available there in more detail.

In this article...

Setting Up Your PayPal Payment Methods

The following instructions apply to CE 1.4 and later and EE v1.9 to v1.12.0.0.

Note: In Magento EE 1.12.0.1 and later, the options in the Admin Panel are different. In particular, to access PayPal payment methods, go to System?Configuration, and, in the SALES group in the left navigation bar, click Payment Methods. All payment methods display on the right but some of those options are also different.

To configure PayPal for your Magento store:

  1. In the Magento Admin Panel, choose System?Configuration. Select the PayPal tab on the left. You'll see the following options: image
  2. In the Merchant Account panel, you can set the following values:
    • Merchant Country - Select the merchant's country, i.e. the country to which the Merchant's PayPal account is associated. The countries available for selection are listed according to the PayPal Worldwide reference. If the merchant country is not specified, its value is taken from Default Country field located under System?Configuration?General tab?Countries Options panel. The payment method selections available below will be changed to reflect only those that are valid for this country.
    • Email Associated with PayPal Merchant Account - Enter the email address that was used when registering a merchant account with PayPal. If not yet registered with PayPal, simply enter your email address. If the Email Associated with PayPal Merchant Account field is empty, the Website Payments Standard payment method will be unavailable and the Express Checkout method is only available if the API credentials are specified. Instant Payment Notifications (IPNs) from PayPal are not available if the email address for sending IPNs and the one specified in the Merchant Account configuration are different.
  3. In the Select a PayPal Solution panel, select which of the following PayPal payment methods you'd like to have available in your store:
    • Express Checkout
    • Website Payments Standard
    • Website Payments Pro
    • Website Payments Pro Payflow Edition (includes its own Express Checkout)
    • Payflow Pro Gateway
    • Express Checkout with Payflow Pro Gateway
  4. Depending on the payment method(s) you've selected, the corresponding payment method configuration panel will becomes available below. Each of these is described in more detail in the following sections. Enter the required information for each of your selected PayPal payment method(s).
  5. After you've entered the required configuration information, click the [Save Config] button in the upper right.

The following PayPal payment methods require that your customers also have customer accounts in PayPal:

  • Express Checkout
  • Website Payments Standard
  • Express Checkout for Payflow Pro

These PayPal payment methods do not require your customers to have a PayPal account and allow them to enter their credit card information directly on your website during the checkout process:

  • Website Payments Pro
  • Website Payments Pro Payflow Edition
  • Payflow Pro Gateway

Express Checkout

With this payment method enabled, the [Checkout with PayPal] button becomes available on the product view pages, in the shopping cart, and in the mini shopping cart. Clicking the button allows the customer to review the shopping cart price information on the PayPal site. To use this method of payment, the customer needs to log on to his or her customer account in PayPal. The payment system uses the customer’s billing and shipping information taken from the customer’s PayPal account. The customer can then continue and will be redirected to the Magento Review Order page. After placing the order in Magento, the payment information is submitted to PayPal and the payment transaction is settled there.

If the customer does not use the express checkout button, the payment information is submitted to PayPal after an order is placed. The Express Checkout payment method can be used standalone; if the API credentials are not specified, the payment method is used in the unilateral mode. With the Express Checkout payment method enabled, make sure that the API Username, API Password, and API Signature fields are populated; otherwise, the payment method will work in the unilateral mode.

Express Checkout is automatically disabled if the Website Payments Pro Payflow Edition payment method is enabled.

The Express Checkout payment method is applied in all countries from the PayPal Worldwide reference list.

Config Options in the Express Checkout Settings Panel

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  • Title - Enter the name of the payment method that will be displayed to the customer in the Payment Information section of the shopping cart Checkout page. This parameter can be set up for each store view. We recommend that you use the PayPal value in the Title field for each store view.
  • Sort Order - When you use several payment methods, in the Sort Order field determine the order this method will be displayed in the Payment Information section of the shopping cart Checkout page in the frontend.
  • Payment Action - Choose the way payments will be authorized in the PayPal payment system and the entities that will be created in the backend as a result of the payment procedure. The following options are available:
    • Authorization - payments are only authorized at the side of the PayPal system and only an order is created in the backend of your store. The store administrator needs log to on to the merchant account on the PayPal site and capture the transaction.
    • Sale- a payment is authorized and captured at PayPal's side and as a result an order and an invoice are created in the backend of your store.
  • Payment Applicable From - Choose customers of which countries can use this method of payment. Choose between the following options:
    • All Allowed Countries – customers from the default countries list can use this payment method. (The default list of countries is defined in the Allow Countries field located under System > Configuration > General > Countries Options.)
    • Specific Countries – only customers whose billing address includes one of the countries listed in the Countries Payment Applicable From field that becomes available can use this payment method. The field basically works as a filter; so that this payment method will only be listed for those customers whose billing address is one of these selected countries.
  • Debug Mode - Specify whether data messages about all sent to the payment system and received from it information will be written into the system log file. The credit card related information is not written to the log file in order to prevent credit card fraud.
  • Transfer Cart Line Items - Choose whether shopping cart lines, i.e. items and their prices, are transferred separately line by line or they are transferred as one whole with their price total value. If the parameter is enabled, the Transfer Shipping Options field becomes available.
  • Transfer Shipping Options - Allows the customer change shipping addresses and shipping method on the PayPal web site. In the live mode, the parameter works via the HTTPS protocol only. The parameter does not work if more than ten shipping options are available.
  • Shortcut on Shopping Cart - Choose whether the customer can use the express checkout button on the shopping cart page and in the mini shopping cart. Clicking the button redirects the customer to the PayPal site where the shopping cart price information can be reviewed. If the parameter is set to No, the express checkout button on the product page still remains available.
  • Shortcut on Product View - Choose whether the express checkout button is available on the product view page.
  • Shortcut Buttons Flavor - Choose whether a dynamic or a static PayPal Acceptance Mark image will be displayed next to the payment method in the Payment Information section of the shopping cart Checkout page. (For better image management, we recommend that you replace static images in your system with dynamic ones.)
    • Dynamic – The appearance of dynamic images is dynamically changed by PayPal. When signing up for a PayPal campaign, the appearance of the image dynamically changes during the campaign based on the parameter information that you add to the image URL. The express checkout image displayed in the following figure is a default one used by PayPal.
    • Static – The static images cannot be changed dynamically. When participating in a PayPal campaign, the image code must be manually updated to change the image displayed and restore the default image when the campaign is over.
  • Enable PayPal Guest Checkout - If set to Yes, Magento customers who are not registered with PayPal have the ability to perform the payment without registering with PayPal. In this case, the customer needs to specify credit card information and billing address. After PayPal validates the credit card information, the customer can proceed to review the payment information and perform the actual payment. If the field is set to No, the customer must register with PayPal prior to proceeding to the payment.
  • Billing Agreement Signup - Specify whether the customer can sign a billing agreement when there are no active billing agreements available in the customer account. The storeowner needs to apply to PayPal for enabling billing agreements feature. The Billing Agreement Signup parameter must be enabled only after PayPal confirms that billing agreements are enabled for your merchant account. Choose between the following options in the Billing Agreement Signup field:
    • Auto – the customer needs to sign a billing agreement.
    • Ask Customer – the customer can decide whether to sign a billing agreement.
    • Never – the customer cannot sign a billing agreement.

Website Payments Standard

This method redirects the customer to the PayPal site when they place their order. For customers with a PayPal customer account with credit card information specified, payment is a one-step procedure as the customer only needs to click the Pay Now button and expect for purchased items delivery.

The Website Payments Standard payment method will be unavailable or becomes disabled if Website Payments Pro and/or Website Payments Pro Payflow Edition are enabled. The Website Payments Standard method of payment is applied in all countries from the PayPal Worldwide reference list.

Config Options in the Website Payment Standard Panel

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For detailed information about the configuration parameters of the Website Payments Standard payment method, refer to the Express Checkout section above.

Website Payments Pro

When the Website Payments Pro method is enabled customers don't need to have an account with PayPal and they are not redirected to the PayPal web site during checkout. They only need to provide their credit card information in the Payment Information section of the Checkout process when they place an order. PayPal will process the payment using the specified credit card information through its PayPal all-in-one solution. The Express Checkout payment method (described above) is also automatically selected and cannot be disabled when the Website Payments Pro payment method is enabled.

The Website Payments Pro method of payment is only applied in the United States, the United Kingdom, and Canada.

Config Options in the Website Payments Pro Panel

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  • Title - We recommend that for each store view you set the payment method title (which will be visible on your checkout pages) to something meaningful for your customers. Generally "Debit Card" or "Credit Card" work well.
  • Under Credit Card Settings section, in the Allowed Credit Card Types field, select all allowed types of credit cards that can be used for performing payments through the PayPal system. In the Payment Information section of the Checkout page in the frontend, the customer can choose among the specified in this list credit card types. The following credit card types are available:
    • American Express (Note: American Express cards require signing an additional agreement. You can learn more at http://www.paypal.com/amexupdate.)
    • Visa
    • MasterCard
    • Discover
    • Switch/Maestro
    • Solo
  • Require CVV Entry - Choose whether a credit card verification number must be provided by the customer when entering credit card information during checkout. The Card Security Code provides an additional security measure to prevent card misuse within on-line transactions. (The Card Security Code is also known as the Card Verification Value.)
  • 3D Secure Card Validation - Choose whether credit cards will be verified through the Centinel 3D Secure system. The 3D Secure functionality used for credit card verification must first be set up under System > Configuration > SALES > Payment Services > 3D Secure Credit Card Verification. In this case, credit card validation will be performed by the external Centinel® system when the PayPal Website Payments Pro payment method is selected. If the parameter is enabled, the following two fields become available: Severe 3D Secure Card Validation - Choose whether severe validation will be applied to credit cards by the Centinel system. Severe credit card validation removes the charge back liability on merchant.
  • Centinel Custom Api URL - Enter the URL provided by Centinel which will establish the connection with the Centinel system for credit card validation.

For detailed information about the rest of the configuration parameters for the Website Payments Pro payment method, refer to the Express Checkout section above.

Website Payments Pro (Payflow Edition)

Customers using this payment method do not need to have a customer account with PayPal. Credit card information is entered during the checkout process. After the order is placed, the PayPal payment system processes credit card payments through the Payflow Pro Gateway.

When Website Payments Pro Payflow Edition is enabled, the Express Checkout for Payflow Pro payment method is automatically enabled and it uses Website Payments Pro Payflow Edition API credentials for connecting to PayPal.

The Website Payments Pro Payflow Edition payment method is only applied for United States and the United Kingdom. The storeowner needs to have a Payflow Pro account with PayPal to set up the connection to the payment system. The account information provided during registration must be entered in the Api/Integration field group. For more information about the Api/Integration parameters, refer to the Setting Up API Integration section of this article.

The allowed credit card types for the Website Payments Pro Payflow Edition payment method are Visa, MasterCard, Switch/Maestro, and Solo.

Config Options in the Website Payments Pro (Payflow Edition) Panel

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For detailed information about the rest of the configuration parameters for the Website Payments Pro Payflow Edition payment method, refer to the Express Checkout section above.

Payflow Pro Gateway

Customers using this payment method do not need to have a customer account with PayPal. Credit card information is entered during the checkout process. After the order is placed, the PayPal payment system processes credit card payments through the Payflow Pro Gateway.

The Payflow Pro Gateway payment method, also known as VeriSign, is only applied in the United States, the United Kingdom, Australia, and New Zealand.

The merchant needs to have a Payflow Pro account with PayPal to set up the connection to the payment system. The account information provided during registration must be entered in the Api/Integration field group. For more information about the Api/Integration parameters, refer to the Setting Up API Integration section of this article.

The allowed credit card types for the Website Payments Pro Payflow Edition payment method are American Express, Visa, MasterCard, Discover, and JCB. American Express cards require signing an additional agreement. You can learn more at http://www.paypal.com/amexupdate.

Config Options in the Payflow Pro Gateway Panel

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For detailed information about the rest of the configuration parameters for the Payflow Pro Gateway payment method, refer to the Express Checkout section above.

Express Checkout for Payflow Pro

Express Checkout for Payflow Pro cannot be used standalone. It uses API credentials of the Payflow Pro Gateway or Website Payments Pro Payflow Edition payment methods. If both these methods are enabled, Express Checkout will use API credentials of the Website Payments Pro Payflow Edition payment method.

Customers using the Express Checkout payment method do not have to enter billing and shipping information during the checkout process as this information is stored in the PayPal payment system and the customers do not have to re-enter it on your website again and again.

Config Options in the Express Checkout for Payflow Pro Panel

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Configuring API Integration to PayPal

API credentials must be specified in order to establish a connection to the PayPal API server. The Website Payments Pro Payflow Edition and Payflow Pro Gateway payment methods require the specific API credentials the merchant received when registering for a Payflow Pro merchant account.

To set up the API:

  1. In the Magento Admin Panel, choose System?Configuration. Select the PayPal tab on the left. You'll see the following options: image
  2. In the API/Integration Setting panel, you can set the following values:
    • In the API Username, API Password, and API Signature fields, enter the API username, password, and signature provided by the PayPal payment system. API credentials can be located by clicking the API Credentials link in your PayPal merchant account.
    • Click the [Get Credentials from PayPal] button to be redirected to the PayPal site where you can get the API credentials for your merchant account. When in dev and testing phases, click the Sandbox Credentials button in your PayPal account to log on to your sandbox test account, and click the API Credentials link to acquire the necessary information.
    • Sandbox Mode - Indicate if you're in test or production mode for the PayPal payment system merchant account. The Sandbox mode helps testing the integration of Magento with the PayPal payment system. Transactions that are submitted while the account is in the Sandbox mode are not actually submitted to the credit card and electronic check processing networks, and credit card or bank accounts are not actually charged. Therefore, they do not have a valid transaction ID. Once you've finished testing the integration and website, the sandbox mode must be turned off.
    • API Uses Proxy - Indicate whether a proxy server will be used for establishing the connection between your Magento store and the PayPal payment system. This is used if the server has a firewall, and there’s no direct access to the PayPal server. You can use a third party server to relay the traffic.
      • If you select Yes, two additional fields for specifying the proxy host and port become available. In the Proxy Host and Proxy Port fields, specify the address of the proxy server and its port number to establish the connection between Magento and the PayPal payment system.
    • Click the [Save Config] button or proceed to further payment methods configuration.

Configuring the Frontend Experience

You can also easily set the style of the payment page and the PayPal logo used by Magento without having to customize your theme or code.

  1. In the Magento Admin Panel, choose System?Configuration. Select the PayPal tab on the left. You'll see the following options: image
  2. In the Frontend Experience Settings panel, you can set the following values:
    • PayPal Product Logo - Choose an additional PayPal logo that will be displayed on the catalog and product view pages and on the home. Out-of-the-box the logo is displayed in the right column on the home page. Customers who are already used to using PayPal for payments can easily see that your store supports PayPal payments. The following options are available:
      • No Logo
      • We prefer PayPal (150 x 60)
      • We prefer PayPal (150 x 40)
      • Now accepting PayPal (150 x 60)
      • Now accepting PayPal (150 x 40)
      • Payments by PayPal (150 x 60)
      • Payments by PayPal (150 x 40)
      • Shop now using (150 x 60)
      • Shop now using (150 x 40)
    • In the PayPal Merchant Pages Style section, make changes to the appearance of pages on the PayPal web site where the customer is redirected.
      • Page Style - Specify the custom payment page style from your merchant account profile. The allowed values are "paypal", "primary" (default), your_custom_value.
      • Header Image URL - Specify the URL for the image that will be displayed in the upper left part of the checkout page. The size of an image should not exceed 750 X 90 pixels.
      • Header Background Color - Specify a case-insensitive six-character HTML hexadecimal color code in ASCII. This will be the background color for the header of the checkout page.
      • Header Border Color - Specify a case-insensitive six-character HTML hexadecimal color code in ASCII. This is the color of the 2-pixel line around the header space.
      • Page Background Color - Specify a case-insensitive six-character HTML hexadecimal color code in ASCII. This is the background color of the checkout page around the header and payment form.
  3. Click the [Save Config] button and make sure to refresh page cache after making changes to the page style parameters.

* In an independent survey by Ipsos Public Affairs in July 2010, online merchants reported an average 18% increase in sales since adding PayPal Express Checkout. Another survey conducted by Northstar Research Partners, Q2 2011, was based on retailer-level data for 19 UK SMB retailers, representing 3,411 PayPal users. 26% of buyers surveyed said they would not have made the purchase if PayPal had not been offered as a payment method.

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