Understanding Your Payment Gateway Options

This article compares the two options available on Teachable for processing student payments and receiving your earnings.

Monthly Payment Gateway vs. Custom Payment Gateways

There are two options when it comes to processing payments and receiving your earnings: the Monthly Payment Gateway or custom payment gateways.

If you’re not sure which payment gateway is best for you, see our comparison guide: 

 

Monthly Payment Gateway

Custom Payment Gateways

What Teachable plan do I need to use this payment gateway? Available on all plans Available on Professional plans and higher
What payment processors do I need to set up?

When you set up your Teachable school, the default payment method is for Teachable to process payments using our own gateway. To set up the Monthly Payment Gateway, you must input your PayPal email address.

To set up the Monthly Payment Gateway, you must input your PayPal email address in order to be paid out. 

See here for more details about setting up the Monthly Payment Gateway.

School owners have the option of connecting both their Stripe Connect and PayPal accounts, or they can disable PayPal as a payment option.  

While you can set up only one custom payment gateway, both Stripe and PayPal (Business) must be set up in order for a school owner to receive all payouts directly.

For example, if only PayPal has been set up then any purchase made using a credit card will be processed through the Monthly Payment Gateway and will be subject to Teachable’s refund policy and transaction fees.

See here for more details about setting up custom payment gateways.

Are these payment processors available in my country? School owners only need a valid PayPal account in order to be paid out by Teachable.

Visit PayPal to check if PayPal is supported in your country.

Schools owners can set up both Stripe and PayPal, or they disable PayPal and connect only their Stripe Connect account. 

Visit PayPal to check if PayPal is supported in your country.

Visit Stripe to see if you’re able to create a Stripe Connect account.

When will I be paid out? Teachable distributes payouts to owners, authors, and affiliates on the 1st of each month unless that falls on a weekend or holiday.

Due to Teachable’s 30-day refund policy, Teachable must hold funds for at least 30 days before releasing them to you. 

For example, on March 1, you would receive a payment for all course purchases that took place in January. Then, on April 1, you are paid for purchases made in February, and so on.

Stripe or PayPal distributes payouts directly to school owners. In order to be paid out directly, both your Stripe Connect and PayPal accounts must be connected to your Teachable school.

For example, if you want to be paid out directly for all purchases, you can connect both your Stripe and PayPal accounts as custom payment gateways. Alternatively, if you don't want to offer PayPal as a payment option or if PayPal is not available in your country, you can disable the PayPal option. However, if the PayPal option is not disabled and a school owner doesn't connect their own PayPal account, then PayPal payments will be processed with the Monthly Payment Gateway and its respective fees, payout schedule, etc. 

Who pays out my affiliates, authors, and admins? Teachable automatically distributes payouts to owners, authors, and affiliates. Since payments over custom gateways never touch Teachable’s accounts, Teachable cannot make deductions from them to pay your authors and/or affiliates. Instead, Teachable records the amounts that you owe them in the transactions report so you can make the payments on your own.
What are the transaction fees associated with this payment gateway?

 

On the Free plan:
  • $1 fixed fee + 10% of the course price (Teachable fee)
  • 2.9 % of the course price + 30 cents (credit card processing fee)
On the Basic plan:
  • 5% of the course price (Teachable fee)
  • 2.9 % of the course price + 30 cents (credit card processing fee)
On the Professional plan:
  • 2% of the course price (Teachable fee)
  • 2.9% + 30 cents (credit card processing fee)
On the Business plan:
  • 0% of the course price
  • 2.9% + 30 cents transaction fee

Additional fees may apply for international sales and exchanges.

On the Professional plan:
  • 0% of the course price
  • Whatever processing fees you negotiate with Stripe/PayPal
On the Business plan:
  • 0% of the course price
  • Whatever processing fees you negotiate with Stripe/PayPal

Additional Fees may apply for international sales and exchanges.

Who do I pay fees to? Teachable automatically deducts fees from your payout. Rather than paying Teachable’s transaction fees, you pay transaction fees directly to Stripe and PayPal. Teachable does not charge commission on courses sold through custom payment gateways.
Can I price my course in currencies other than USD? Teachable allows instructors to sell their courses in multiple currencies, however, students can only use Stripe to purchase a course priced in a non-USD currency. PayPal will not display as a payment option for students purchasing a course in a non-USD currency.

See here for currencies that the Monthly Payment Gateway supports:

Supported Payment Methods and Currencies

Teachable allows instructors to sell their courses in multiple currencies, however, students can only use Stripe to purchase a course priced in a non-USD currency. PayPal will not display as a payment option for students purchasing a course in a non-USD currency.

Stripe Supported Currencies

Can I be paid out in non-USD currency? Teachable can only pay out school owner in USD and payouts are subject to PayPal’s conversion fees. You can set up your Stripe or PayPal accounts to pay you out in non-USD currencies, as long as the currency is supported by Stripe or PayPal.

Stripe Supported Currencies

PayPal Supported Currencies

How do I handle VAT taxes? We handle VAT completely since Teachable is the legal merchant of record. As the legal merchant on record, we must by law collect the appropriate tax from EU users when they check out. We have an automatic process to do this (so no action is required on your end). For schools with one custom payment gateway set up (Stripe or PayPal), VAT will automatically be charged at checkout.

For schools with both custom payment gateway credentials set up (Stripe and PayPal), however, VAT collection is optional but will be on by default. You can disable this option in your payment settings.

Note that in the case when VAT is collected over a custom gateway, Teachable is not collecting the taxes; rather, they are going straight to your Stripe Connect or PayPal account along with the rest of the purchase, and you will be responsible for filing and paying the taxes yourself.

Can I disable automatic VAT collection? No. VAT is automatically collected. Yes, VAT collection can be disabled but only if both custom payment gateways (Stripe and PayPal) are set up.
Can I issue refunds through this payment gateway?

 

If your student is requesting a refund on a transaction made within the 30 day refund period, you can process the refund directly within Teachable.  All fees will also be returned to the school owner when a transaction is refunded.

If the 30-day period has passed, you'll have to refund your student outside of Teachable. This can be done through a third-party.

If your student requests a refund on a transaction made within the 30 day refund period, you can process the refund directly within Teachable. You can also set up your own refund policy for a longer period of time, or institute a no-refund policy.

Even if the 30-day period has passed, you'll be able to refund your student through your Stripe or PayPal account.

 

How are automatic recurring (subscription, payment plans, etc.) payments processed? Recurring payments can only be processed by Stripe. PayPal will not display as a payment option for courses that have recurring pricing plans. Recurring payments can only be processed by Stripe. PayPal will not display as a payment option for courses that have recurring pricing plans.
What happens if I switch from this payment gateway to the other? Payments are processed through whichever gateways are active. Payments will be processed through whichever gateways are active. However, all payments made on the Monthly Payment Gateway will continue to be held for 30 days.

Recurring payments (e.g., subscriptions and payment plans) will be processed by whichever gateway is active, however, the subscription charge will be based on the initial subscription charge.

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