Money may be universal but in the world of e-commerce, it comes in different forms. In an article for GetElastic.com, Peter Sheldon wrote some of the different forms of global payments for e-commerce transactions all over the world.
According to Sheldon, China has the largest consumer market in the world with 420 million Internet users. Here, credit card penetration is low but this has not slowed down e-commerce business. Taobao, China’s version of eBay, has created Alipay which in essence is their version of PayPal. Alipay has over 300 million subscribers and, according to the article, allows its users to pay cash on delivery or immediately after transaction.
Meanwhile, Germans are more familiar with credit card transactions. However, Sheldon points out that Germans do not like the idea of having credit on their cards and so German e-commerce merchants offer the option of direct bank credit transfer. In Brazil, credit card payments are widely used but most e-commerce merchants allow their customers to pay in instalments, even of up to 12 months, interest free. International credit cards are often accepted, including their local card, the Hipercard.
In Japan, credit card installments are also a popular mode of payments. In fact, the Apple store in Japan allows customers up to 24 months to pay for their purchases. Additionally, Sheldon says that Japan is largely a cash-based society, where credit card penetration is also very low. If you are an e-commerce merchant targeting Japanese customers, Sheldon recommends konbini payments, which are essentially convenience store payments. After the customer orders the goods online, they select the convenience store option and are then given a pay ID. Customers then have six days to go to a konbini and pay for their items after which the goods are then shipped.
As an e-commerce merchant, what do these examples mean for you? As Sheldon points out, it encourages e-commerce merchants to do research. This is particularly important if you are targeting local markets. Find out what other e-commerce stores are doing and partner up with your payment gateway provider to help you set up a payment system that effectively caters to your customers’ needs.