Why Every E-Commerce Business Needs to Have a Global Payment Strategy

E-commerce businesses need to adapt to keep pace in a growing digital economy. They also need to be in sync with the needs and preferences of today’s customers. Brand leaders have to “think global” in their payment strategy in order to capture market share and win new customers.

The Global Nature of E-commerce

E-commerce is global. There are over five billion internet users worldwide, and the number of people shopping online is ever-increasing. In 2022, retail e-commerce saleswere estimated to exceed 5.7 trillion US dollars globally, and this is set to increase in the coming years. In Europe alone, 91% of people used the internet and over 75% of them shopped online in 2022. The region is set to become the third largest e-commerce market in the world, after the US and China.

To cater to these customers, e-commerce brands need to take a global approach to expand into new markets and win new customers. Newer forms of digital payments help growing online retail businesses connect to a larger audience. Offering payment methods that are popular and widely accepted across different regions, is therefore, essential.

A siloed or outdated payment strategy can be expensive, slow, and prone to risks. This denies brands precious opportunities to tap into today’s competitive markets. To keep up, businesses need to adapt and evolve.

In recent years, more SMBs have become aware of the importance of modern payment technology. Yet without a comprehensive infrastructure, they find it challenging to use these systems and extract value from them. Processes like payment routing, reconciliation, handling overhead charges, etc. still remain a challenge for many.

Plus, different regions have different risk and compliance rules. Brands must adhere to these laws or risk facing heavy fines and legal action, or worse, closure or debarment from doing business.

Adopting a Global Payment Strategy

A global payment strategy enables your brand to connect with local customers and tap into unique local trends that bring you better visibility and traffic.
This involves:

• Offering global and local payment methods
• Tracking local trends, consumer habits, and payment preferences
• Working with local partners (or a well-connected global one)
• Setting up a system that addresses compliance issues and needs

That’s why you need a global payments system – it helps you target a larger audience across the world, connect with them, and convert them into loyal customers.

Such a system makes payments more convenient and reduces operational challenges. Their use of automation speeds up critical processes, remove redundancies, and streamlines your payments. This results in faster payment processing, higher acceptance rates, and lowered costs. You also get targeted insights and real-time risk management.

Such systems also give you greater visibility and control into your payments – from real-time tracking to reconciliation to scheduling payments. You can also support payments in multiple currencies and payment methods, and analyse payment data to draw insights into customer behaviour and local market trends.

Global payment systems can be configured and tailored to your business needs. Work with a trusted service provider like Novalnet to easily integrate the required software and upgrade your payment infrastructure without disrupting present workflow and business processes.

How Brands Gain from a Global Payments System

Improved brand connect with customers, creates a richer experience
A global payments strategy helps you connect with your core audiences better. Knowing your customers will help you offer them better services and products.

With modern payment systems, you can automatically track and keep a record of client data such as payment history, preferred payment methods, geographical location, etc. You can use this data to monitor and analyze their buying patterns and map their preferences and expectations.

Inconvenient checkouts lead to higher shopping cart abandonment rates. Think slow approval times, lack of ideal payment options, or a long, complicated checkout process.

When you use a global payment system, you can integrate multiple payment methods and currencies, giving your customers more choice. When you offer customers their preferred payment options, you make them feel more comfortable about your brand. A seamless payment experience drives repeat customers, leading to reduced cart abandonment and higher sales.

Reducing friction, improve payment acceptance rates
Adopting a global payment approach helps you to design your checkout to the market you are in. Being aware of what works locally can help you take steps to reduce friction and improve your payment acceptance rates.
For e-commerce merchants, improving approval rates and reducing false declines should be top priority. Because payment declines frustrate buyers and lead to cart abandonment and loss of revenue, all of which have a negative impact on brand perception.

Global payment systems help increase your approval rates as you can offer multiple payment options. This way when a customer’s primary payment method fails, you can offer them reliable fallback options. Features like intelligent payment routing allows you to connect your payment gateway to multiple acquirers in different regions. This automatically routes a payment to the bank that is most likely to approve it.

You can also speak to your PSP for features like automatic retries and a recurring indicator tools. These are ideal for avoiding payment declines, especially in subscription payments.

Build trust, allay fears with robust anti-fraud measures
Global payment systems have in-built fraud detection features to keep all customer payment data safe from fraud and theft. These are fully compliant with global and local laws, such as PCI-DSS and PSD2 in Europe, which make them more secure and capable of detecting unusual red flag behavior.

Modern payment systems follow strong customer authentication (SCA) rules as mandated by laws in the EU. Measures like multi-factor authentication and other advanced anti-fraud tools like 3D Secure and tokenization ensure end-to-end security of all payments.

These systems also use advanced analytics, Artificial Intelligence and machine learning to sift through tons of payment data to detect fraud in real-time. These algorithms constantly track, learn, and adapt to newer forms of threat, adding more punch to your risk management strategy.

Better market reach, lower costs, and more conversions
Global payment systems give you a wider reach because it helps you offer more payment options for customers in different markets. This improves your conversion rates – studies have found that adding multiple payment options can increase conversion rates by as much as 30%.

Brands that sell to customers globally have to think of extra costs like FX charges, card processing fees, taxes, service fees, etc. With a global payment system, it gets easier for people to pay you in their currency. Plus, new-age digital payment methods, like e-wallets, levy only nominal charges, making them more financially viable.

Modern payment systems also use automation to reduce repetitive tasks, which saves time and effort. This translates to lesser operating costs and higher efficiency, adding to your bottom line.

Global Payments with Novalnet

As a global payment services provider, Novalnet can help you take the best strategy to capture global markets. We are trusted advisors to Europe’s leading brands, helping them to process payments smoothly and safely.

With our technology, you can accept payments globally in 125+ currencies in 150+ automated country-specific payment methods . Plus, our AI-based risk management solutions and advanced analytics solutions help you design the best payment experiences for your customers, all in a fully secure PCI DSS-certified environment.
Give us a call today to know more.

Jose Augustine

Jose Augustine is the Chief Business Development Officer at Novalnet with extensive experience in European payment industry and a knowledge powerhouse.