Expanding Your Business Into Europe — Requirements for Payments Success
With the economy still in flux here in the U.S., many retailers are looking at possibilities overseas for growing their business. If these retailers want to offer an online store for consumers abroad, it requires much more than just a localized website. They must know the payment expectations, regulations and requirements of the local markets and prospective customers. Retailers need to adapt their customer payment processing specifically for different geographies to support a successful international expansion. But what does that entail?
While PayPal and many credit cards are acceptable payment methods around the world, consumers in different countries have different preferences and expectations when checking out. Here’s a brief snapshot of what’s needed for online payments in several European countries:
The UK
The Maestro card is gaining traction in European e-commerce and is a very important factor for today’s online stores. In the U.K. especially, banks are replacing old Switch cards with Maestro cards because the Maestro card has an estimated U.K. customer potential of 20 million.
Germany
German consumers expect retailers to have a German address and prices shown in euros, not U.S. dollars. This also applies to payment methods at checkout, with site visitors expecting to see payment methods like credit and direct debit cards, PayPal, giropay, and payment on invoice.
Austria
The e-payment standard has been used in Austria as a popular payment method for several years now. Other regular payment options used in Austria are direct debit and Maestro SecureCode, which is distributed via Austrian banks.
France
The French are only aware of the rules of one card, the Carte Bancaire or Carte Bleue. The Carte Bleue is a Visa credit card which allows the online merchant to process the transaction according to its Visa credit card agreement. However, because not every Carte Bleue has Visa on it, if an online retailer is solely dependent upon this they can lose a significant prospect base in France. Retailers that want to reach this missing market segment need a payment service provider (PSP) that's connected to French banks which offer debit cards as well as highly competitive pricing.
The Netherlands
The Dutch primarily use iDEAL online wire transfers, which use PIN code and transaction authentication number payment guarantees, which protects the merchant. About half of all online purchases are paid this way. The rest are mainly transacted via credit cards and PayPal, with a small number by direct debit.
Across the board, preventing payment-related fraud is key, regardless of geography and payment method. It's obviously important for a retailer conducting business from potentially the other side of the globe. There are secure payment methods such as MasterCard SecureCode and Verified by Visa, but a payment guarantee will only provide limited protection of individual payment. Therefore, it’s recommended that online retailers also work with a PSP that offers effective fraud prevention. This should mitigate risk while protecting their customers in real time without disrupting order processing, driving a positive experience on both sides.
Doris Linke is the CEO of payment service provider Computop's North American branch.
