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Tell me how many payment methods you offer, and I’ll tell you how successful you can become.”

Imagine you run a coffee shop on one of Belgium’s busiest streets, or maybe you have just opened a web shop. You have spent a lot of money on espresso machines and in-store decorations or on optimising your user experience on your website, and your business has taken off. Some bike courier has turned in with an online order for three hot chocolates to be delivered to some customers who most probably are working from home and want to indulge.

There are also people queuing in front of your store. Hot steam of freshly-made espresso is filling the room after you have brewed two cups of coffee. A guy with a colourful scarf taps his smartphone to pay. Next, a fashionable lady gently touches her bracelet to your store POS to purchase coffee and some mugs as presents. They both smile and sip from their cup, while you tell them about the possibility to join your loyalty program to enjoy additional discounts.

bancontact post illustration

The Bancontact debit card is a popular payment method in Belgium and the most used card in this country.

This is a fortunate example, but some merchants still welcome their clients with signs such as “We only accept cash or payment by Visa or Mastercard” (for online stores), excluding other means of paying, such as e-wallets, contactless payments, mobile payments, vouchers, mobile apps, etc.

By offering just a few payment options at the checkout, merchants are bound to lose sales because some customers will have no choice but to leave without purchasing what they wanted. They will simply go elsewhere and probably not return. You can read more about the advantages of using local and alternative payment methods in this Macropay review of the industry.

An understanding of local preferences is crucial for successful businesses. Plus, by offering appropriate payment options, merchants can maximise conversion rates.

Today, we are continuing our series of presenting different payment methods and will be focusing on Belgium’s most loved payment experience, Bancontact. The Bancontact debit card is a popular payment method in Belgium and the most used card in this country. Did you know that in 2019 in Belgium, Bancontact was significantly more popular than Visa and Mastercard?

Bancontact is the domestic debit card scheme in Belgium, allowing consumers to pay in real-time and guarantee payment to (online) merchants and businesses. Bancontact payments are immediately debited from the consumer’s bank account. The seller’s account will be credited on the next working day. A Bancontact card with a PIN is issued to people who open/hold a Belgian bank account. The card is linked to a customer’s current account, and it is accepted in Belgium in most stores, restaurants, hairdressers, and so on. Many shops only accept Bancontact as a means of paying by card. Today, there are more Bancontact cards in circulation (15 million) than there are Belgian citizens (11.46 million).

No less than 99% of all consumers know Bancontact, and 86% of all payments by electronic card are Bancontact payments. Consumers feel comfortable because their payment is facilitated by their bank. Transaction transparency is enhanced as their transaction history and payment details can be viewed in their banking reports. Users do not have to sign up for the service, as they only need to have a bank account and select the Bancontact method upon checkout. Regarding transactions pricing, Bancontact applies fixed fallback interchange and service fees.

Customers can use Bancontact to pay back friends when going out (e.g. paying the bill for the whole table or splitting it), lend money to relatives, or pay bills and invoices.

It’s Time to Pay in a Fashionable Way

One of the hottest features of Bancontact is that it can be paired with a wearable to make contactless payments. One of the main findings of the “Bancontact Payconiq Company’s Big Payment Survey 2020” revealed that Belgians love paying contactless, with 72% of all Belgians making a contactless payment using their bank card or a smartphone in 2020. That is an impressive rise of 123% compared with 2019 (32%) because the number has more than doubled.

Wearables are innovative means of payment in the form of accessories, like a smart ring, bracelet, watch, or key ring that support contactless transactions. Belgian banks that offer Bancontact payments via wearables to their customers are KBC, CBC, and KBC Brussels. These wearables contain a chip, which makes it possible to make a contactless payment like a Bancontact card. Payment with wearables can be made via all payment terminals that have a contactless symbol and accept Bancontact payments. To pay, users need to hold the wearable against the contactless symbol. In one move, the payment is complete, and consumers get a confirmation. Purchases over 50 euros need to be confirmed with their Bancontact card PIN.

Besides the convenience of contactless payments, trust is also valued.

Going back to Payconiq’s survey, 52% of Belgian respondents believe that mobile or contactless payments are equally secure as traditional payment options. In 2019, that figure was still only 40%. Contactless bank card transactions that don’t require a PIN code are already the second most popular way of paying in supermarkets (at 15%, behind using a bank card and PIN) or at the bakery (22%, after cash).

Illustration bancontact blog post

One of the main findings of the “Bancontact Payconiq Company’s Big Payment Survey 2020” revealed that Belgians love paying contactless, with 72% of all Belgians making a contactless payment using their bank card or a smartphone in 2020.

Bancontact is very popular among merchants as it gives their Belgian customers an easy-to-use and secure online method to pay for purchases. With this payment method, merchants are guaranteed their funds and don’t have to deal with chargebacks or reserves. In addition, for customers who do not want to use a credit card online, Bancontact is an excellent alternative payment method that can be offered.

Statistics have also shown that support for local traders is also growing, with 62% of respondents saying that the COVID-19 crisis has prompted them to shop locally more often; therefore, small merchants need to be equipped to enable customers to pay using their preferred payment method. Via a payment button, merchants enjoy all the advantages of accepting mobile payments; it’s frictionless and safe. The service can be activated either through direct integration with Payconiq—the company supporting Bancontact—or via one of their partner Payment Service Providers, such as Macropay. To tap into this service, merchants pay 6 cents per transaction for payment in a store or 20 cents for an online payment The same applies to merchants that go online, as Bancontact can be integrated into web shops and apps.

But this is all relevant information for Belgium. When it comes to payment methods, there are estimated to be several hundred, including real-time bank transfers, mobile wallets, direct debits, prepaid cards, electronic cash payments, local card schemes, and payout services. These options vary in popularity according to region and country. In our next instalment, we will be travelling to Latin America and tell you all you need to know about.

In the comments, feel free to share your guess about what we will be discussing next.