Arvato research identifies national consumer payment trends


Arvato research identifies national consumer payment trends

A recent analysis undertaken by Arvato Supply Chain Solutions has concluded that when it comes to making purchases in online shops, credit cards are currently the preferred method of choice. However, electronic payment systems are becoming more popular, along with paying with smartphones and tablets.

“In this study, we not only dealt with the established eCommerce markets, but also the emerging markets in Eastern and Southeastern Europe”, explains Dennis Schmitz, Vice President Financial Services at Arvato Supply Chain Solutions.

For example, Arvato found that payment by credit card dominates, particularly Visa, Mastercard and the national variation, Mir. Payment on delivery is also extremely popular, which means the customer pays the carrier at package receipt.

“What sounds unusual for us is completely normal for Russians. Some shops even use their own courier personnel: the drivers are instructed to wait for 15 minutes while the customer tries on the ordered goods and determines if they wish to keep them and make payment, or return them immediately. Often this is because of the cumbersome nature of the returns process.”

Of the countries examined by Arvato Supply Chain Solutions, Russia shows the highest growth rate for mobile payments in Europe. Every second resident of Moscow already has an electronic wallet – a so-called E-Wallet – installed on their smartphone. The company says Russians prefer national systems such as Yandex Money, QIWI and WebMoney over global solutions like PayPal or Apple Pay.

“Retailers who wish to successfully expand into the Russian market cannot avoid integrating the most important local payment service providers into their web shops,” says Mr Schmitz.

In Sweden on the other hand, purchasing on account is one of the most popular payment methods next to the credit card. As a result, more than 50% of the online shops examined who offer payment on account do so via Klarna. This fintech, headquartered in Stockholm, assumes the merchant’s payment claim and guarantees settlement, regardless of when or if the end customer pays their invoice.

“The success of an online shop depends largely on which payment methods the retailer offers its customers,” explains Mr Schmitz. “If preferred methods are not available, the danger of an abandoned cart increases.”

“The challenge is, therefore, to reconcile the interests of the retailer with payment preferences of the customer, while taking country specific particularities into account,” he adds.

Arvato Supply Chain Solutions, via their own Financial Services division, offer end-to-end financial services with scalable international solutions in the areas of risk management, payment processing, fraud management, and accounts receivable.

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