How to setup PayPal payment method for subscription

Last updated on April 25, 2022

Since WooCommerce version 5.5.0, PayPal Standard is hidden for new installations. This change doesn’t affect existing stores. Therefore, this artcile is specifically meant for existing PayPal standrad users.

The subscription plugin and its associated payment gateways have to work hand in hand for a faultless recurrence payment. Our plugin, Subscriptions for WooCommerce provides an extension for Paypal which is the inbuilt WooCommerce payment gateway. PayPal handles the automatic recurring subscription payment in the following two different manners:

PayPal Standard
PayPal Reference Transactions

PayPal Standard

Paypal standard is a widely used payment method as it’s very easy to set up. You will need to have the following requirements prior to using PayPal Standard as the payment method for the subscription products:

verified PayPal business account
IPN (Instant Payment Network) configured appropriately as mentioned below in the section Configuring PayPal IPN
valid PayPal API credentials entered into WooCommerce

Set up and Configuration

Follow the steps to configure PayPal Standard:

Go to: WooCommerce > Settings > Payments.
Use the toggle under Enabled to select PayPal.
Select Set up. You will be redirected to the PayPal Standard settings.
Enter your email address in the PayPal Email field, which is the most important thing to configure before making payments. The email entered here must match with the email on the PayPal Business account.

Advanced Options

Select the Enable PayPal Sandbox checkbox if you wish to test the checkout process during your store’s development. With sandbox enabled, no payment/money is taken. Create a separate sandbox account via PayPal Sandbox to use PayPal in sandbox mode.

Debug log may also be turned on, which can be useful during development. You may need to first create a wc-logs folder and set permissions to make it writable. These logs are available at WooCommerce > System Status > Logs and then select the PayPal log from the dropdown.

Instant Payment Notifications (IPN) are sent from PayPal when you receive a payment, issue a refund or a chargeback or cancellation. Tick the box for Enable IPN Email Notifications (optional).

Enter an email address for Receiver Mail if this address is different than the PayPal email address you entered above in step 4.

PayPal Identity Token (optional). Only required if you signed up for the Data Transfer option on your PayPal account; can be used to verify payments if you have IPN issues.

Specify an Invoice Prefix (useful if you have multiple stores). WC is defaulted to denote WooCommerce transactions.

There are two shipping options:

Send shipping details to PayPal: If you want WooCommerce to send the shipping details to PayPal to create shipping labels instead of billing, enable this checkbox.
Address override option: PayPal verifies addresses if enabled, therefore, it is advised to keep it disabled, but it can be useful in preventing address information from being changed.

Payment Action lets you choose to Capture funds immediately or only Authorize. Once an ‘authorize only’ order has been changed to Processing or Completed, funds are automatically captured as long as you have entered your PayPal API Credentials under WooCommerce > Settings > Payments > PayPal.

In Page Style, optionally enter the name of the page style you wish to use. These are defined within your PayPal account. This affects classic PayPal checkout screens.

Image URL optionally enter the URL to a 150x50px image displayed as your logo in the upper left corner of the PayPal checkout pages.

There are three fields to paste API information into:

API Username
API Password
API Signature

To get the API credentials:

Log in to your PayPal business account.
Get API Access credential in any of the two ways:
Go to Activity at the top of the page and choose API Access or
From Account settings > API Access.
Scroll down to NVP/SOAP API Integration (Classic) and click Manage API credentials.
Create keys if not done already. Else, copy the API Username, API Password, and Signature
Paste API Username, API Password, and Signature in the respective fields of the plugin.

Paypal Reference Transactions

Paypal Reference transactions are considered in cases where the PayPal standard fails to meet certain requirements or when advanced subscriptions features have to be implemented. However, PayPal Reference transactions can be availed only by privileged customers approved by PayPal. If your account is approved, Subscriptions will automatically detect that Reference Transactions are supported and switch to using that payment method. On the other hand, If your account does not have Reference Transactions enabled, WooCommerce Subscriptions continues to use PayPal Standard for subscription purchases and recurring payments.

Refer to know How do I get Reference Transactions Enabled with PayPal?

Configuring PayPal IPN

Be it PayPal Standard or Reference Transactions, both the payment gateways make use of the PayPal IPN (Instant Payment Notification) to monitor recurring payments and updates in subscription status.

From your PayPal Business account, go to Profile > Account settings > Notifications.
Update the instant payment notification.

To start or stop receiving IPN messages and to decide where to send them, click the Choose IPN Settings button.

Enter the notification URL and enable Receive IPN messages as shown below:

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This article posted in Documentation, Knowledge Base, Subscriptions for WooCommerce, Subscriptions Payment Gateway Guide and tagged PayPal, Set up PayPal, Subscriptions for WooCommerce, woocommerce

Written by

Shesna

Shesna is a technical content writer for WebToffee. She is familiar in working closely with the SMEs to break down complex technical information into a concise, easy to understand manner.

Comments (5)

John

October 4, 2022

No longer working? I get an error saying “Sorry, it seems there are no available payment methods which support subscriptions.” now.

Reply
- Mike
  
  December 5, 2022
  Hi John,
  
  In order to enable recurring payments using WooCommerce PayPal Payments, you need to enable the below-listed options in PayPal:
  
  Vaulting must be enabled in the plugin settings (can only be enabled when it is active for the PayPal REST application).
  
  Ensure that the plugin is subscribed to the latest webhooks.
  
  Reference Transactions are required for automatic subscription renewal payments via PayPal.
  Reply
ROBERT EMMA

March 24, 2022

For some reason, paypal standard stopped working for subscription products.

Reply
Joanne

February 21, 2022

HI
If I add Subscriptions plugin to my woocommerce page
when I add a product and set it to subscription
how do I make sure it takes the said amount out of their Credit Card (( stripe )) and or (( paypal )) every month or every year automatuically
I am setting up a subscription for a PAID service SEO
thanks

Joanne

Reply
- Mark
  
  March 21, 2022
  
  Hi Joanne,
  
  Greetings from Webtoffee!
  
  If a user purchases a subscription product created using our Subscription for Woocommerce plugin using a compatible Stripe or PayPal plugin, it will be automatically charged based on the recurring billing charge. There are no special configuration needed.
  
  Reply

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How to setup PayPal payment method for subscription

PayPal Standard

Set up and Configuration

Paypal Reference Transactions

Configuring PayPal IPN

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Our plugins

How to setup PayPal payment method for subscription

PayPal Standard

Set up and Configuration

Paypal Reference Transactions

Configuring PayPal IPN

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