Australia turns its back on credit cards in alternative payments revolutionmCommerce to make up a third of the online shopping market by 2021
October 18, 2017
18th October 2017 – Sydney — Australians are set to increase their use of alternative payments over that of credit cards in the next five years, according to new data from leading payment company Worldpay.
Credit cards are currently the dominant eCommerce payment method in Australia, accounting for 37% of all eCommerce in 2017. This figure is set to drop to 12.6% by 2021, with bank transfers replacing credit cards as the most popular payment method. Although accounting for less than a fifth of all online payments today, bank transfers are projected to jump by 23% over the next five years, to make up 43% of the market.
Debit cards are also in decline, set to fall from 9% to just 6.5% of the market, while cash on delivery will also drop slightly – from 7% to 5.6%. Meanwhile the use of e-Wallets, already a very popular payment method in Australia, is set increase by 4% over the same timeframe, making up 28% of online payments. The findings come from Worldpay’s annual Global Payments Report, which analysed eCommerce spending patterns across 36 different markets on five continents. The research forecasts that the Asia-Pacific eCommerce market will grow by an average of 12% annually and is set to be worth US$2,100bn by 20211. Projected to grow by 11% over this period, Australia’s eCommerce market is slower than average for the region, but the country’s mCommerce is set to soar by an impressive 31% by 2021, faster than many of its neighbours.
Commenting on the report, Phil Pomford, General Manager for Asia Pacific at Worldpay said: “Australia is a unique market within Asia-Pacific: it has a highly-connected, affluent and growing population, combined with very high level of international sales. Cross-border trade accounted for nearly 20% of Australian eCommerce in 2016 and a massive 86% of consumers said that they have completed a cross-border purchase.
“As Australians start to use more alternative payments such as e-Wallets and bank transfers in addition to plastic, merchants and other retailers must ensure that they can continue to support Australian consumers’ preferred ways to pay,” continued Pomford. “They should also take into account the very strong growth in mCommerce, and continue to invest in providing great mobile shopping experience by integrating popular payment methods into their mCommerce platforms.”
Worldpay has compiled the following recommendations for merchants looking to cash in on the continued strong growth of mCommerce and eCommerce in Australia and the wider Asia-Pacific region:
- One-click ordering: Consumers are more likely to shop more often with companies that save their payment details for one-click ordering. Merchants should provide one-click ordering to make online checkout as seamless as possible – especially via mobile apps.
- Offer choice: The decline in credit and debit cards means it will be more important than ever to offer popular alternative methods including e-Wallets like PayPal and Visa Checkout.
- Cross-border trade: Merchants should ensure that they have local acquiring capabilities wherever they have a legal entity; offer a wide range of currencies at checkout; and consider local language customer support in their customers’ time zone to deliver a great customer experience.
About the 2017 Global Payments Report
This report was compiled using a mixture of primary and secondary data sources. Primary refers to our own surveys and commissioned research; whereas secondary refers to authoritative third-party vendor data, and other publicly available data. The report also draws upon Worldpay’s decades of experience in providing global eCommerce solutions. The eCommerce projected growth figures contained in this report were sourced from GlobalData’s E-Commerce Analytics database and relate to the eCommerce industry as a whole, not Worldpay’s business. GlobalData collected this data using consumer surveys, B2B surveys and desk research. Any indicative predictions based on the data we have used should be treated as such.
Worldpay is a leading payments company with global reach. We provide an extensive range of technology-led payment products and services to around 400,000 customers, enabling their businesses to grow and prosper. We manage the increasing complexity of the payments landscape for our customers, allowing them to accept the widest range of payment types around the world. Using our network and technology, we are able to process payments from geographies covering 99% of global GDP, across 146 countries and 126 currencies. We help our customers to accept more than 300 different payment types. For more information, visit http://www.worldpay.com/global/about/regional-expertise/asia-pacific
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