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‘Alternative’ generally means unconventional or outside the mainstream. It’s something niche, specialist or has a small yet devoted following. Think alternative rock, alternative medicine or alternative energy.
But in the world of payments, the term ‘alternative payment methods’ or APMs are often the most popular ways to pay. Alternative payment methods can range from domestic cards to cash-based vouchers, to digital wallets such as Apple Pay and Google Pay, or bank transfers such as iDEAL in the Netherlands, Przelewy24 in Poland, or POLi in Australia and New Zealand.
When it comes to payments, ‘alternative’ is a misnomer. Often, these alternative payment methods are actually mainstream and are preferred over the major card brands in many markets.
Take Dutch shoppers, for example; 59% of online purchases in the Netherlands are made with the local bank transfer payment, iDEAL. There were more than half a billion iDEAL payments made in 2018, with one-in-six of these made on a foreign website. And that’s precisely the point for businesses looking to attract customers globally.
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Payment is local
However much the internet enables global commerce, payments — as much as language, currency and product selection — is local. That’s because there’s no single, global way to pay.
Visa and Mastercard only account for 20% and 16% of total cards in circulation worldwide respectively, giving a combined total of 36% according to RBR.
In fact, the most popular payment card in the world is China’s UnionPay, which accounts for 45% of the world’s cards. Customers in China are issued a UnionPay card by their bank by default. So if you’re selling into China or hoping to attract Chinese merchants, accepting UnionPay, along with WeChat Pay and Alipay e-wallets, is a must.
However, it’s not just about cards. According to the World Bank, around two billion adults worldwide are unbanked, so acceptance of cash-based payment types in some markets is a must. For example, Checkout.com recently announced an integration with OXXO, a cash-based payment method in Mexico, where 63% of the adult population is unbanked.
Payment is local and personal. Customers also like what’s familiar. If they usually pay a certain way, why would they do something new to shop with you? When convenience is key to closing sales, offering a preferred payment method will reduce payment friction and hassle.
How Checkout.com can help
At Checkout.com, we understand local nuances. We have local presence and expertise with offices in ten countries worldwide and counting. When it comes to local payment, we offer a single, streamlined integration to all types of payments, depending on where and how you trade. This is done via a single payments endpoint with no intermediaries, which means better adaptability and faster speed-to-market for our customers.
We process 150+ currencies and 16 like-for-like currencies, saving our customers FX fees. Our automated Reconciliation API saves our merchants time and effort on the back-end, too.
Contact our team of payment experts today to learn how Checkout.com can accelerate your global growth.
