Offering Local Payment Methods on the IRP

When selling online, it is imperative to have a way of accepting credit and debit cards. It is crucial to have a professional, tried and tested system that customers can trust with their payment details. For most retailers, this will mean having a merchant account with an established payment gateway like Realex or Worldpay.

Card payments however should not be the only way of accepting payments on your website. There are an ever-growing number of companies who offer customers different ways of paying for things.

When considering ecommerce growth, especially in international markets, one must consider how customers in certain geographical regions prefer to pay online. In many countries, card is not the only method of payment for online transactions. There are in excess of 300 different types of payments in the world of ecommerce. Most non-card payment methods (Local Payment Methods or ‘LPMs’ for short) can be categorised as the following:

• Bank Transfer
• Direct Debit
• eWallet
• Mobile Payment
• Domestic Card Scheme
• Pre-Pay
• Post-Pay

In some geographical locations, an LPM can be your customer’s preferred method of payment and may represent a higher percentage of ecommerce sales when compared to payment by card:

Fig 1. Sample of Payment Methods Adopted in Several Geographical Locations

Offering LPMs may allow retailers to:

• Reach new customers by offering them a variety of payment options applicable to them.
• Increase conversion by offering customers their preferred method of payment.
• Decrease costs due to lower risk of fraud or lower transaction fees.

LPMs are generally used to address a domestic economy — the payment systems are generally supported and operated by local banks. Each LPM will have its own application and settlement process, language and currency support, and will be subject to domestic rules and regulations.

The number of LPMs has grown exponentially over the last few years. This is down to a number of factors including:

• Less access to credit
• Security fears
• Limited credit card penetration
• Customary and traditional local payment habits

Offering LPMs may bring advantages to both the customer and the retailer:

For more details, see the Worldpay Insight Hub.

Table 2. Payment Method Predictions – Asia and Pacific 2016 vs. 2020

Table 3. Payment Method Predictions – Europe and Middle East 2016 vs. 2020

Table 4. Payment Method Predictions – North America 2016 vs. 2020

Table 5. Payment Method Predictions – Latin America 2016 vs. 2020

Table 6. Payment Method Predictions – Overall Global 2016 vs. 2020

Chinese company Alipay is the world’s most popular online payment method. It accounts for 44% of global eWallet spend and is predicted to command a 60% share of the global eWallet market by 2020.

Alipay was introduced when mobile adoption in China was booming and consumers were spending rapidly. China’s consumer base digital travel accounted for $100 billion alone in 2016, which rivalled Microsoft’s overall revenue. It is predicted that, come 2020, this figure will have doubled.

Alipay has become a ‘lifestyle’ choice in China — consumers use Alipay when booking taxis, looking for a restaurant or when they want to make a peer-to-peer transaction. By contrast, Western consumers are more likely to open their browser to buy goods and use a purpose-built app for money transfers. This highlights the stark differences between China and the fragmented Western market.

In Europe and North America, companies like PayPal are competing for a market share with technology vendors such as Apple and Google, who in turn compete with smaller scale offerings from hundreds of payment providers and merchant-owned services.

This fragmented approach offers consumers more choice but has also led to slower adoption as people remain unsure of which payment methods are most relevant to them, and of their relative merits.

The coming years are likely to see major technology companies like Facebook, Apple and Google try to follow in Alipay’s footsteps and compete on the ‘lifestyle’ front.

The use of credit cards in Europe is low compared to countries like the United States which means that online direct debit solutions are particularly popular in some European countries. Although chargebacks for direct debit solutions are still a problem, additional verification systems reduce the risk of chargebacks significantly and many payment processors like Worldpay implement stringent fraud database systems that mitigate this risk.

The IRP offers users the ability to avail of Local Payment Methods in international territories via its integration with Worldpay (see the Worldpay Accounts help topic in the IRP Knowledge Base for more information). With the IRP’s comprehensive language, banner and navigation internationalisation features, customers from previously-untapped regions should be given absolute confidence, breaking down any barrier to purchase.

Some of the Local Payment Methods offered via the IRP integration with Worldpay are listed below (source: Worldpay):

Table 7: Local Payment Methods

Method	Type	Territories
Paga Wallet: Paga Wallet is a secure eWallet service that’s available in Nigeria. It lets you collect payments from customers who don’t have access to bank accounts. Customers can load their account using a variety of payment methods, for example at an agent or using a bank deposit or card payment. The customer logs in to their eWallet account and provides a unique PIN ensuring this method of payment offers a secure, fast and convenient way to purchase goods and services online.	eWallet	Nigeria
Swedbank: With a significant market share, formerly known as Hansabank, the Swedbank Bank Link service allows Swedbank customers to make online payments directly from their bank account to a customer. Bank transfer is a very popular payment method in Sweden; it is predicted that its popularity will increase further as more and more people start to use internet banking. Payments are secure, as the shopper must enter their internet banking credentials to authorise the payment. The merchant receives real-time authorisation, so can ship goods immediately.	Bank Transfer	Worldwide
Giropay: Giropay is a real-time bank transfer service popular in Germany. The service enables shoppers to pay for goods and services over the internet by making an online transfer directly from their own bank account. Direct payments by bank transfer are popular across Europe and in the German market. Giropay connects to over 70% of the banking network.	Bank Transfer	Germany
CashU: CashU is a popular e-Wallet service that enables quick, easy and secure online payments in the Middle East and North Africa. Users simply need to register for a CashU account and load it with funds online or at one of the supporting outlets. It can be loaded using prepaid vouchers, CashU prepaid card, cash over the counter, mobile or by bank transfer. CashU is seen as a safe and secure payment option for customers who prefer not to release their card details online. Additionally, when customers pay online using a prepaid account, the merchant receives immediate notification, making this method ideal for providing instant delivery of goods and services.	eWallet	Middle East North Africa
UnionPay: UnionPay is the biggest and fastest-growing card scheme in the world (counting the number of cards issued). It is a highly-recognised brand in China, and its profile is increasing worldwide. All of China’s major banks issue UnionPay-branded cards. UnionPay is the only interbank network in China linking ATMs and all banks. Outside of China, UnionPay is rapidly expanding its footprint and — as of November 2015 — ecommerce-enabled cards are issued in China, Hong Kong, Macau, South Korea, Pakistan, Philippines, Thailand, Laos, Russia, Japan and Singapore. Although only a proportion of cards in some of these territories are currently ecommerce-enabled, UnionPay have ambitious plans to increase their hold on the ecommerce market around the world. Worldpay enables merchants to accept debit card, credit card and real-time bank transfers. Worldpay allows consumers to pay using their preferred currency — Chinese Renminbi — and can settle to merchants in a wide range of different currencies according to your needs.	Domestic Schemes Bank Transfer	China Hong Kong Macau South Korea Pakistan Philippines Thailand Laos Russia Japan Singapore
Multibanco: Multibanco is a popular post-pay payment method in Portugal. It can be used by shoppers with a bank card issued by any bank affiliated to the Multibanco service. The service is supported by all major banks in the country, and is therefore accessible to the maximum number of shoppers. There are currently more than 20 million Multibanco cards, most of which are co-branded as Visa or MasterCard.	Post-Pay	Portugal
Digital Garage: Worldpay’s Konbini and Pay-easy product — hosted by Digital Garage — provides merchants with access to a range of payment options in Japan. It is the ideal method to offer to your Japanese shopper, as it combines cash payments — perfect for the unbanked — with online banking payments, guaranteeing that you will reach the maximum number of shoppers. Konbini (which means “convenience store” in Japanese) enables the shopper to order goods and services online, and to pay for them over the counter in a convenience store. Japan has an extensive network of convenience stores, which makes this payment method very accessible to the Japanese shopper. During the checkout process, the shopper is provided with a unique payment reference. The shopper uses this reference to print a voucher in the convenience store which he or she then settles at the till in the store. Pay-easy is a well-known brand in Japan, and enables shoppers to make payments from their online bank. The shopper simply selects their bank of choice, and is redirected to their online banking interface to complete the payment. Alternatively, the shopper can make a note of the payment reference provided, and complete the payment at an ATM. There is a large network of ATMs bearing the Pay-easy logo in Japan. Additionally, Pay-easy payments can be completed at many post office branches. Worldpay gives the merchant the option of using both Konbini and Pay-easy through a single connection; alternatively, the merchant can opt to take only one of these two payment options, depending on the type of goods being sold and the demographic that the merchant is targeting.	Post-Pay Bank Transfer	Japan
DineroMail: DineroMail is a convenient and secure voucher method widely used in Latin America. DineroMail offers wide selections of payment methods including post-pay vouchers and internet bank transfers. A number of major banks are affiliated with this service. This type of transaction is very secure as the shopper must be verified using their bank’s standard verification standards. This method is completely intuitive for the shopper and merchant alike. The shopper completes his or her purchase online by being redirected onto the DineroMail website and selecting their bank to make the payment from. Once confirmation of payment has been received by the merchant, the goods are then dispatched. Local Payments Methods are very popular in South America due to the low penetration of cards. In Mexico for example, cards only account for just over 30% of transactions.	Post-Pay Bank Transfer	Latin America
ELV: ELV (or Elektronisches Lastschriftverfahren) is the official local name for Direct Debit in Germany. It is typically used for lower value purchases, but offers the flexibility of both one-off and repeat payments such as subscriptions. Germany is a large ecommerce market in Europe and ELV accounts for more sales than cards. This payment method should be a key consideration when selling to German consumers.	Direct Debit Domestic Schemes	Germany
eNets: eNets is a major player within the Singaporean payment space. It provides a safe and secure real-time bank transfer facility for customers to use within their familiar and trusted internet banking service. Customers log into their bank account using their existing credentials to initiate the payment directly to a merchant. Any merchant selling to the Singapore market should consider eNets as it is the payment method of choice for many shoppers in the country.	Bank Transfer	Singapore
EPS: EPS is the most popular bank transfer scheme in Austria with almost half the market share of all bank transfer methods. Bank transfers have a 31.1% share of the Austrian ecommerce market. EPS offers shoppers a simple and secure option for paying for goods and services over the internet. Shoppers log in using their existing credentials to make payments directly to the merchant, which means that payments are made from within the security of their banking environment. Merchants receive authorisation in real-time which makes this payment option very secure.	Bank Transfer	Austria
Neosurf: Neosurf is a pre-paid voucher that allows shoppers to pay on the internet easily, securely and anonymously. Neosurf provides merchants with the option to support customers who do not want to enter personal data, bank account information or credit card numbers online. Shoppers can exchange cash for a Neosurf voucher at over 20,000 sales outlets located in France, Italy, Spain and Belgium.	Pre-Pay	France Italy Spain Belgium
PayPal: PayPal is a secure and simple digital wallet service with over 220 million accounts worldwide. It is a very strong and easily recognisable brand for customers and a popular method for making payments for goods and services online. Over recent years it has become well established in many countries around the world. Customers simply log into their PayPal account to complete the transactions without having to expose card details online. They can choose to load their wallet with funds from their credit or debit cards or link it directly to their bank account. It supports major cards, such as Visa, MasterCard and American Express, and lets customers pay without sharing their card details online. PayPal has been one of the major success stories in the payments industry over recent years and growth is steady at over 20% year-on-year.	eWallet	Worldwide
Paysafecard: Paysafecard is a popular pre-paid voucher service that allows customers to shop securely online. Paysafecard boast that this payment method is “as safe and as fast as cash”. The shopper buys a paysafecard at one of the many outlets and stores which sell paysafecard vouchers. The shopper then uses the unique voucher code to make purchases online. Alternatively, the shopper can store their paysafecards inside a virtual wallet known as ‘mypaysafecard’ and then use this virtual wallet to shop online by simply entering their username and password. The simplicity of this payment method — and the fact that is accessible to shoppers without bank accounts — makes paysafecard the ideal payment method to reach different demographics of shopper. Additionally, its wide geographic presence — it is supported in most European countries and beyond — means that it is a must-have method of payment for many merchants looking to expand their geographic footprint. As the merchant receives instant notification of payment, it is the perfect payment method for digital goods as well as physical goods — the merchant can dispatch immediately, secure in the knowledge that the shopper has paid.	Pre-Pay	Europe
POLi: POLi is a popular real-time bank transfer payment method used in Australia and New Zealand. It enables customers to pay merchants direct from their bank account by simply logging on to their online bank and using existing banking credentials. Many customers favour real-time banking due to the straightforward payment flow, security and having trust in their bank’s brand. By offering POLi, you can reach 95% of Australians who have internet banking capabilities.	Bank Transfer	Australia New Zealand
Postepay: Postepay is a popular pre-paid card service operated by Poste Italiane in Italy. Customers can buy and reload Postepay cards from 14,000 Post offices, 4,500 ATMs and participating retailers throughout Italy. Postepay cards are branded with Visa Electron or MasterCard and can be used to pay for goods and services wherever Visa Electron or MasterCard is supported. Postepay is perceived as a safe and secure payment option for Italian shoppers who prefer not to expose their financial details online. Despite the fact that many Italians still prefer to pay by cash and that internet penetration is still relatively low, the take-up of ecommerce in Italy is accelerating quickly.	Pre-Pay	Italy
Przelewy24: Przelewy24 (otherwise known as P24) is a popular payment method in Poland which enables shoppers to make payments to merchants from their online bank. Przelewy24 is a well-known brand in Poland and is supported by most of Poland’s major banks, which gives the merchant access to the maximum number of shoppers. Przelewy24 should be the number one choice for any merchant selling online in Poland. As in other European markets, shoppers in Poland are comfortable with the idea of making payments directly from their bank account. The shopper simply chooses his or her bank from a menu, and is redirected immediately to their online bank to complete the payment. In most cases, the merchant will receive real-time notification of payment, enabling instant delivery of goods and services.	Bank Transfer	Poland
Qiwi: Qiwi is a payment method that shoppers from a number of countries including Russia and Kazakhstan can use to make both real-time and offline payments. Qiwi offers a host of payment options. Shoppers who pay with Qiwi can use one of the following methods: the Qiwi eWallet, a payment kiosk, a credit/debit card linked to their Qiwi account, a pre-pay balance on a mobile phone or a Webmoney account linked to their Qiwi account. Qiwi is perceived as a safe, intuitive and secure payment option for shoppers who either do not have bank account or who prefer not to release their card details online.	Post-Pay eWallet	Russia Kazakhstan
SOFORT: SOFORT enables shoppers to make payments to merchants directly from their online banking. It is a very popular method of payment in Austria, Germany and Belgium, and is gradually gaining a strong foothold in other markets such as France, Italy, Spain and the UK. SOFORT should be seen as a necessity for any merchant operating in Austria, Germany and Belgium (where awareness of the SOFORT brand is high), and as a method with high potential in other countries. In many European markets, shoppers feel more comfortable paying from their bank account than they do using traditional cards. SOFORT offers the shopper a seamless payment experience, requiring the shopper to enter their banking credentials to complete a payment. Shoppers feel comfortable using SOFORT as it offers all the security of traditional online banking — including two-factor authentication. The responsive design of SOFORT’s payment pages makes this the ideal method for making payments on the move — it works seamlessly on desktops, tablets and mobile devices. Additionally, SOFORT supports a high proportion of the major banks, meaning that it is accessible to a higher than ever proportion of shoppers. This method offers the merchant a real-time notification of payment, making it ideal for merchants who offer time-critical goods and services.	Bank Transfer	Austria Germany Belgium France Italy Spain UK
WebMoney: WebMoney is a popular, fast and secure eWallet payment service available in Russia. The service enables shoppers to make online payments in real-time. Shoppers can load funds into their WebMoney account via bank transfer, pre-paid card or cash deposit at a supporting outlet across Russia. Users must have a WebMoney account to use this service. The shopper logs in to their WebMoney account, using their login credentials and confirms the transaction. eWallets are the fastest-growing payment type around the world and with Russian ecommerce experiencing significant growth, Webmoney has become a popular payment option for shoppers as it offers a simple and secure method of transacting online.	eWallet	Russia
Yandex.Money: Yandex.Money is a popular and well regarded eWallet in Russia. It is a subsidiary of the largest search engine in Russia, Yandex. The eWallet is used by over 13 million users. The Russian ecommerce market has grown significantly over recent years and eWallets are now the second largest payment type in the market. The Yandex.Money eWallet can be loaded using a variety of different methods, such as bank transfers or by paying cash at participating terminals, making it a convenient option for shoppers and giving them choice and familiarity.	eWallet	Russia
SafetyPay: SafetyPay is a growing payment method targeted primarily at shoppers in South America and is currently trying to gain a foothold in Europe too. SafetyPay enables shoppers to make payments from their online bank account in a few very simple steps. After selecting SafetyPay as their method of payment, the shopper is provided with a unique transaction reference. The shopper logs into their internet banking portal, chooses the SafetyPay option on the bank page, and enters their unique transaction reference and the transaction amount to complete the payment. The shopper is shown a real-time notification that their payment has succeeded. As the payment is electronic, the merchant receives a real-time notification of payment, making this payment method ideal for time-sensitive purchases. In some countries, the shopper can also complete their payment in cash. Once again, the shopper makes a note of the unique transaction reference provided, but this time goes to their bank branch to complete the payment.	Bank Transfer	South America Europe
Boleto Bancário: Boleto Bancário is one of the most prominent payment methods in Brazil. The word ‘boleto’ means ‘ticket’. Even though card transactions are becoming more popular, Boleto Bancário retains a significant share of the market, particularly amongst consumers who are unbanked or who prefer to pay either in cash or by bank transfer. The consumer can print a payment slip and pay over the counter at any participating outlet (there is a wide network of supermarkets, post offices and other stores in Brazil that offer this service) or alternatively pay using a bank transfer from their online bank. Most of the major Brazilian banks are supported. Worldpay enables merchants to accept payments in Brazil without having a local entity. Merchants can price in the local currency (Brazilian real) and receive settlement in either USD or EUR. As this is an offline payment method, authorisation is most often delayed, as shoppers have several days to pay their Boleto voucher.	Post-Pay Bank Transfer	Brazil
Alipay: Alipay is the most popular eWallet service in China, with over 800 million users and 8.5 million transactions per day. Nearly half of all ecommerce transactions in China (44.3%) are made using eWallets and Alipay is the most popular ecommerce payment provider with 30% market share. Alipay partners with a broad range of financial institutions and other partners in China. As it is an eWallet, consumers have access to a broad range of payment options when they pay using Alipay. Given its significant market share, Alipay should be a key consideration for any merchant wishing to sell into the Chinese market. The Alipay brand is well known and is part of one of the largest ecommerce companies in the world, the Alibaba group. Worldpay allows consumers to pay using their preferred currency — Chinese Renminbi — and can settle to merchants in a wide range of different currencies according to your needs.	eWallet Bank Transfer Post-Pay	China
SEB Bank: The SEB Bank Link service allows SEB customers to make online payments directly from their bank account to a merchant. Making payments by bank transfer is a popular way of transacting across Europe and payments made this way are predicted to grow further in the coming years as familiarity and adoption levels of internet banking increase. SEB is a popular payment method amongst Nordic and Estonian ecommerce shoppers.	Bank Transfer	Scandinavia Estonia
Trustly: Trustly online banking e-payments solution enables customers to pay merchants with real-time and next-bank day payments. Trustly is a licensed European Payment Services Provider, authorised and supervised by the Swedish Financial Supervisory Authority. They are also a member of the European Payment Institutions Federation (EPIF). It is perceived as a safe, intuitive and secure way of paying in Denmark, Estonia, Finland, Poland, Spain and Sweden. Shoppers authenticate their bank account, by using their internet banking authentication credentials, to make a payment. The process is straightforward and similar to other online bank transfer services.	Bank Transfer	Denmark Estonia Finland Poland Spain Sweden Belgium
Mister Cash (Bancontact): The Mister Cash (Bancontact) debit card is a popular payment method in Belgium and the most commonly-used card in that country. It lets customers make real-time card transactions to buy products and services. A Mister Cash card with a PIN number is issued to customers who open a Belgian bank account. It’s linked to a customer’s current account and is accepted in most retail stores in Belgium. Many shops only accept Mister Cash as a means of paying by card. If you are considering selling to the Belgian market, Mister Cash is a must.	Domestic Schemes	Belgium
iDEAL: iDEAL is a popular real-time bank transfer service available in the Netherlands. It enables shoppers to send payments directly from their internet bank accounts to a merchant. Payments by bank transfers are growing in popularity across Europe, but nowhere more so than the Netherlands, where iDEAL has the largest share of the payments market — in excess of 60% — and is by far the most-widely used and best-known payments brand. iDEAL is seen as a safe, secure and popular payment option for shoppers who are familiar with using real-time bank transfers or prefer not to share their card details online.	Bank Transfer	Netherlands Europe
Paga Verve: Paga Verve is an online debit card payment service available in Nigeria that lets customers pay online with their Verve debit card. This is a domestic debit card linked to their bank account and managed by their bank. The customer selects the Paga Verve payment option on the payment page and uses their existing Verve card in the same way as using other payment cards online.	Domestic Schemes	Nigeria