In Europe, knowing the main local payment methods used in different markets and offering them to their customers can make a difference for a small or medium-sized e -commerce merchant who wants to sell internationally.
Mollie, one of the fastest growing financial services providers in Europe, provides an overview of preferred payment methods by country. The e-commerce report by Mollie published in September 2022, examines the buying habits of European consumers. It sheds light on the different local payment methods that exist, an important factor but often overlooked by e-commerce businesses.
France: the bank card
France is home to one of the largest e-commerce markets in Europe, which is both mature and well-developed. The bank card is the preferred payment method for the French, cited by 78% of survey respondents. At the same time, e-wallets like PayPal are gaining popularity. This is mainly due to strong security credentials. For more expensive purchases, French consumers prefer bank transfers.
Belgium and the Netherlands: Bancontact and iDEAL
Although Belgium and the Netherlands are neighbors, they both have distinct payment preferences. In Belgium, 83% of respondents say Bancontact is the preferred solution for online payments. This payment method is so important to win in this market. Digital wallets like PayPal and Apple Pay are also popular and are the fastest growing payment methods in the country. This can be explained by the fact thata quarter of purchases is carried out using mobile applications.
iDEAL is by far the preferred payment method in the Netherlands, for 82% of Dutch respondents. This is a bank transfer system offered by all Dutch banks. It is followed by direct debit, credit and debit cards, and PayPal. The country, which is one of the fastest growing e-commerce markets in Europe, has several local e-tailers leading the market.
German speaking region: BNPL, e-wallet and TWINT
This region includes Germany, Austria and Switzerland.
Germany tends to be the leading e-commerce in Europe by 2025, thus dethroning the United Kingdom. German consumers appreciate cross-border shopping, especially thanks to the popularity of shipping companies, such as DHL. The nature of this country is that many Germans prefer to use the “Buy Now, Pay Later” (BNPL) system and pay when an invoice is received. Consumers are used to paying the bill when the order is received. Split payments in Germany are expected to grow by 59.9% on an annual basis for reach $60,424.0 million in 2022. Apart from BNPL, another payment method favored by Germans is PayPal.
In Austria, more than a third of online purchases is done using a smartphone and this number is expected to continue to increase. And as in many other European countries, e-wallets are rapidly gaining popularity. Also, BNPL and PayPal are both very popular in the country, just like for its German neighbor. This makes it an important payment option for e-merchants. In addition, credit card payments should not be forgotten either.
Finally, the last country in this region is Switzerland. TWINT is one of the most popular payment methods. It is Switzerland’s own digital payment service. Shoppers can pay with their smartphones. Swiss banks are also slowly opening up to Apple Pay, Google Pay and Samsung Pay, but for years, TWINT was the only accepted online payment option.
United Kingdom: digital wallets
When it comes to online shopping, the UK is one of Europe’s undisputed champions. Last year, the country was almost alonethird of total e-commerce sales in Europe.
For many years, card payments (AmEx, Mastercard, Visa) have been the preferred payment method for purchasing goods in the UK. But now the purchases via mobile, especially in-app purchases, are becoming increasingly common. Consumers prefer this method to place their orders easily, safely and conveniently. The most popular digital wallets in the UK are Apple Pay, PayPal and Google Pay. Additionally, social media channels such as Instagram and Facebook are options that can help drive sales.
“E-merchants who want to expand outside their own home market need to be aware of the importance of offering the right payment method in the market they want to enter. This not only increases revenue and sales, but also builds customer loyalty. While this may seem daunting to some, they can use a payment service provider that offers a personalized, fast, transparent and flexible solution. This service will help optimize conversion, freeing them to focus on growing their business.” explained Philippe Daly, Vice-President of Mollie France.