Research firm yStats.com has release its “Global Alternative Payment Methods 2014” report and reveals that alternative payment options are quickly gaining on traditional payment cards.
With a wide spread of alternative payment options available such as PayPal, Google Wallet, and Login and Pay with Amazon, customers are given more options when purchasing online and even in-stores. Presumed to be announced in the near future, both Apple and Facebook are expected to be revealing their own payment schemes to join the bevy. And rightly so, alternative payment methods (APM) all over the globe are gaining traction and may soon come to replace the current archaic credit and debit payment schemes.
In the US, card transactions account for nearly 75% of payments made, with alternative payment options coming in at a distant second. Of the options made available, mobile and digital wallets are the preferred alternative payment methods. This is due to the ability to use them both online and in supporting brick and mortar establishments. In Canada PayPal is the preferred alternative option and comes in second next to credit/debit cards.
Latin America on the other hand has more fully embraced alternative payment methods, with a nearly 50/50 split between cards and alternative payment methods. Alternative payment methods are important in Latin America with countries like Brazil only surpassing 80% in cardholders in 2013. After bank issued payment cards Boleto Bancario came in second. Argentina also prefers cards over alternative payment methods with Pago Facil or Rapi Pago coming in second to online card payments. In Mexico 66% of payments were made with cards whit Cash on Delivery (CoD) coming in second.
Europe is also projected to large APM growth, and it is estimated by the year 2020 that mobile wallets and Ewallets will be responsible for 20% of all payments. Currently over 50% of payments in Europe are card payments and the EU legislators are working on Epayment regulations to encourage APM adoption.
FXPRIMUS Celebrates 10-Year Anniversary with a Grand Gala in Kuala LumpurGo to article >>
When looking at Europe by country invoice accounted for the largest share of interactive retail sales in Germany for 2013 closely followed by direct debit. Credit cards in Germany accounted for just less than 20% in 2013. The UK saw growth in 2013 when it came to APM, although with a double-digit percentile share bank and payment cards were still preferred by UK residents. The Netherlands most preferred payment method for B2C Ecommerce transactions was local banking solution iDeal with more than 50% of payments, leaving cards with a single digit share.
Russia, with card and APM adoption on the rise with solutions like Yandex and WebMoney offering payment solutions to one of the fastest growing Ecommerce markets, still prefers CoD and cash. the Czech Republic leaned towards banking, with bank transfer options being the most used method of payment in B2C Ecommerce transactions, twice as much as credit and debit cards.
APMs in Asian Pacific countries like Japan and China take a larger substantial share over payment cards. China’s Ecommerce payments are dominated by 3rd party solution like Alipay and grew by 50% in 2013. Japan Konbini payment solution, along with array of mobile payment options are the preferred methods of payment online and in-store. India stands out with is affinity to CoD, caused by a large under-banked community residing in rural areas.
The Middle East and Africa also share India’s preference to CoD. CoD accounted for over 50% of payments in the region, leaving cards with a 33% share. Mobile transfers and banking are growing at a staggering rate with services like Mpesa offering money transfer solutions to non-smartphone owners.
yStats full report can be seen here.