Offering Local Payment Options Attracts More Customers
Today, there are more than 300 forms of local payment options around the world. For any eCommerce business, having the ability to accept a wide range of payments will get you more customers; only accepting Visa or Mastercard in your currency, as opposed to the customer’s local currency, limits who will purchase from you.
According to James Booth, Vice President and head of new business for PPRO, a global firm that focuses on local payment methods and related services, local payment options are increasing. The ability to provide payment options speaks to the specific needs of particular markets, and is crucial to a business’ success.
Booth said that 50 percent of online shoppers have abandoned a transaction because the website failed to offer a preferred payment option. That is a lot of customers and a lot of lost revenue. For businesses with large amounts of of US/Canada shoppers, multi-currency conversion (MCC) and dynamic currency conversion (DCC) are very relevant. MCC is currency conversion that happens after a transaction/sale. If a customer uses a US card in Canada, they will be charged in US dollars. The conversion from CAD to USD happens behind the scenes and appears as a regular purchase on the customer’s statement. For businesses that do a lot of in store purchases, DCC is very appealing, as conversion happens at the point of sale. The customer has the option to choose which currency they would like to be charged in – their local currency, or the country of purchase currency.
Besides DCC and MCC, Booth estimates that some 300 “significant” forms of local payment options are operating around the world – of which, 150 are “really significant.” That number has grown in recent years, and continues to rise. For any business hoping to increase their sales, particularly cross-border, one cannot ignore local payment options. In the long run, research is key, as it is important to understand how customers make purchases and why.
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