Why it’s time to consider local payment options, despite the challenges?
Adam J Clarke, Macropay: To be able to accept local payment methods without impacting conversion on successful transactions, it’s important to understand the local market you’re targeting and how consumers from each country prefer to pay online.
There’s no doubt that payment gateways are an integral part of any business’s ecommerce success. With more than 25% of the world’s population shopping online and digital sales to represent more than 15% of all purchases, merchants face tight competition as they vie for every sales opportunity that comes their way.
However, research shows that 59% of shoppers will abandon a transaction altogether if their preferred payment method is unavailable. People are wary of handing over their credit card information to just anyone, which is why they seek alternative payment options like Giropay and POLI. They fear security breaches that could compromise their information, especially when shopping on a website they aren’t familiar with.
To build trust and encourage customers to complete the transaction, website owners should consider the advantage of local payment options that cater to their global audiences.
The benefits of local and alternative payments
By definition, local payment options are payment solutions that are specific to a certain region. The US has ACH, while South American consumers are familiar with Boleto Bancario. Chinese buyers are likely familiar with Alipay.
Here’s why this matters:
Alternative payments build trust
When consumers visit your website and recognize a payment option that’s familiar to and trusted by them, customer loyalty increases along with your reputation in the market. Shoppers can feel confident about making a purchase without handing over their credit card details, which can translate into more sales for your store.
Local payments attract more customers
Many buyers cannot find the goods they need within their own country, which is why they seek alternatives across borders. You probably have a huge would-be customer base that’s eager to buy your products, if only you had an easy way to accept their payment!
When you offer payment options your global buyers are familiar with, you’re essentially telling them that you recognize their needs and cater to buyers in their area. Local options expand your reach and allow you to earn more sales as a result.
What’s stopping merchants from offering more payment options?
The benefits of offering local payment options are obvious, so what’s preventing merchants from cashing in on a global audience?
A lot of things, actually.
The number of options is overwhelming
Payment options vary around the world, so much so that technology and cultural differences have led to the development of more than 300 significant methods of payment, 150 of which are considered very significant. Naturally, it might not make sense to offer 150 (or all 300) methods of payment on your website. So how do you go about choosing a select few that will make the most impact?
The answer will vary by merchant, as not every store will cater to the same global audience. It’s important to consider where your current and ideal buyers reside, then look into local payment options that are popular in those regions.
Banking regulations abound
The banking industry is rife with regulations and challenges that make it difficult to implement payment solutions. Everything from taxes to foreign transaction fees to currency conversions (more on this point in a moment) can affect a merchant’s ability to do business AND remain profitable in the process.
To be able to accept local payment methods without impacting conversion on successful transactions, it’s important to understand the local market you’re targeting and how consumes from each country would like to pay. It’s challenging to break out of international thinking, which is indicative of traditional payment providers like Visa and Mastercard and really begin to granularize on a country to country basis.
Currency conversions can be difficult to track
Competing in a global economy is no easy feat, and to win more business, merchants must be willing to allow their customers to pay in their native currencies. This often requires gaining business entities and bank accounts in each of the countries in which they conduct business, along with understanding the country’s regulations when it comes to online payments.
How Macropay is changing the local payment option landscape for the better
Historically, offering local payment options isn’t as simple as adding multiple payment options to the checkout process. But with the launch of a new proprietary platform developed by payment solutions provider Macropay, companies can now cater to a global audience at scale while bypassing the traditional hassles of individual payment gateways.
Macropay’s ready-made infrastructure provides one integration to 13 local payment methods (and counting) that have the largest market penetration within their respective regions, including POLi, MULTIBANCO, Sofort, eps, Giropay, iDEAL, SEPA, Trustly, and others.
The goal behind the platform is to remove the repetitive, long-winded contract process associated with adding individual payment options for global consumers. Users can access a single dashboard with a simple, easy to use interface that displays payment options and provides the ability to settle all local currency payment methods to the currency of your choice.
Macropay has also added a full suite of merchant tools, including integrated fraud prevention, fast funding cycles and integrated IBAN banking from within the dashboard. As an added bonus, Macropay users get real account management and support versus chat or email assistance.
With the platform launch, online merchants now have the capability to process payments from a global audience at scale. Learn more by visiting Macropay to get a quote.