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Five Payment Methods Every Growing Business in Europe Should Adopt

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Europeans are paying more through digital channels

Digital has become the chosen way for millions of European shoppers since the pandemic started. Online shopping growth has gone through the roof, while contactless payments seem to be becoming the new norm. Data from Visa shows that in Europe, eight out of ten transactions are now contactless. In 2020, over 73% of Europeans shopped online, of which 31% bought or ordered goods from sellers in other EU countries. Most of these payments were made via digital payment methods such as e-wallets, debit/ credit cards, or PayPal, amongst others.

Globally, the digital payments industry has seen a 40% increase over the last two years. And it is Europe that is expected to clock the most impressive digital payments growth in 2021, raking in over 1.17 trillion USD by the year’s end!

Thus, for small and medium businesses in Europe, going digital with their payments is imperative for growth. Research from Visa shows that 65% of small businesses are concerned about the future of their business and understand that digital payments is the way to go.

If you are a small or medium business in Europe, offering popular payment methods is critical to reaching more customers. You also have to offer payment methods that are preferred locally.

The Five Must-Have Payment Methods

Here we have listed the top 5 most popular payment methods that you must offer in your checkout when selling to customers in Europe.

1. Digital Wallets

Digital wallets are a popular payment method in Europe, with 44 percent of Europeans preferring them over other payment methods. E-wallets enable fast, easy, and secure purchases online or at physical stores, hence their popularity. E-wallets are smartphone apps created by banks or trusted third parties and can be downloaded and used by consumers.

E-wallets use 2-factor authentication and end-to-end encryption to protect merchants and consumers from fraud. Consumers can quickly and easily pay online or in-store with just the click of a button. Some popular digital wallets in Europe include Apple Pay, Google Pay, Amazon Pay, Neteller, Skrill, and Vodafone Wallet.

2. Credit/ Debit Cards

Card payments come a close second in terms of preferred payment methods amongst Europeans, with 42% preferring to pay by card. Card usage is the highest in the UK, accounting for 90% of all online payments. Visa, Mastercard, Amex, and Maestro are the main cards in use.

In France, most cards are Cartes Bancaires co-branded with Visa or Mastercard. Prepaid cards are popular in some countries such as Italy, where Postepay (co-branded with Visa) is the most-preferred prepaid debit card. Prepaid virtual cards are also growing in popularity in Spain.

Keep in mind that you have to use 3D Secure to securely process payments, according to the new PSD2 regulations in EU. However, you might see a drop in conversions in certain markets (for instance, in Spain, it has been seen that 3D Secure lowers conversion by 20%). In these, you should use 3D Secure dynamically only when necessary to balance security and conversion for your customers.

3. PayPal

PayPal is an online payment system that helps users to pay for purchases and send and receive money online. It is the third most popular payment method in Europe, with consumers in Germany and UK being the major users.

PayPal allows users to link their bank accounts or credit/ debit cards to their PayPal account and securely make online payments or in-store through QR codes. Users can also send and receive money from other users using their PayPal accounts. PayPal uses added layers of security such as end-to-end data encryption, multi-factor authentication, and email confirmations for transactions.

4. Local Payment Methods

There are several local payment methods specific to some markets that you have to consider:

  1. iDEAL in The Netherlands: iDEAL is a bank transfer system that is covered by all Dutch banks. 83% of Dutch shoppers use it to pay online, making it the most popular payment method in the country
  2. Bancontact in Belgium: It is a debit card that offers 100% payment guarantee and can be used across online, mobile, and POS payments. Bancontact is the most popular payment method in Belgium.
  3. Giropay, Girocard, Open Invoice in Germany: These are some of the most popular payment methods in Germany. Giropay is an online banking method that is used by over 40 million shoppers, while Girocard is one of the most widely-used cards, with over 100 million in circulation. Open invoices, where customers can make purchases and pay later against the invoice amount, are also very popular in the country.
  4. Direct Debit and SOFORT online banking: Direct Debit (SEPA in EU and BACS in the UK) is another popular payment method, especially in Germany, Belgium, and the UK. SOFORT is an online banking payment method with over 85 million users in Europe and has a high number of users in Germany, Austria, Switzerland, and Belgium.
  5. MultiBanco in Portugal: Multibanco is the most popular payment method in Portugal, accounting for 85% of all online payments. It is a post-pay payment method wherein a customer can pay for their purchase at a later date, using Multibanco ATMs or their online banking.
  6. Cart Si (e-money) and Postepay in Italy: Prepaid virtual cards and e-money are quite popular in Italy, with over 40% of shoppers using them in 2021. Cart Si is the leader in e-money, with over 13 million cards in circulation and over 2 billion transactions. Postepay is the most popular prepaid debit card in the country and is highly favoured by shoppers.

5. Cash-on-Delivery


Cash-on-delivery is a popular payment method in Romania, Spain, and Poland. Though more and more shoppers are moving to digital methods, cash remains a top payment method in these countries.

How Can a PSP Help You With Your Payments?

Offering the right mix of payment methods can play a critical role in your business growth and help you to reach new customers. But choosing the payment methods that work best for your business can become confusing. Working with a global payments service provider like Novalnet can help you to adopt the right payment strategy and technical tools that you need to succeed.

We can help you accept payments globally in 125+ currencies with 150+ automated country-specific payment methods. Our instant plug-ins can be easily integrated so that you can start accepting payments in minutes. With our AI-based risk management solutions and advanced analytics, you can design the best payment experiences for your customers, and all of it in a PCI DSS-compliant environment.

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