Choosing payment methods for a new market

1The problem

When a merchant starts selling into a new country, the payment page is usually the last thing it changes. Cards that work at home are switched on, a wallet or two is added, and the store goes live. That choice assumes buyers in the new market pay the way buyers at home do. The evidence says they often do not, and that the gap shows up at checkout.

2Why payment habits differ

Holding an account is not the same as holding a card. The World Bank's Global Findex survey found that 76 percent of adults worldwide had an account at a bank, another financial institution or a mobile money provider in 2021, and much of the recent growth in developing economies came through mobile money accounts and digital payments¹. A buyer can be fully banked and still have no card to type into a checkout form.

Even in wealthy markets, habits differ. The European Central Bank's survey of payment attitudes in the euro area reports that cash remains the payment method used most often in shops, although its use continues to decline and the share of digital payments rises more slowly than before². Buyers who pay cash in shops do not necessarily pay by card online; many use bank transfers or local schemes.

Instant account-to-account payments add a third axis. The Committee on Payments and Market Infrastructures reports that retail fast payment systems are being adopted around the world at a rapid pace, with some convergence in their features, and that central banks often operate or oversee them³. Where such a system has become a normal way to pay, a checkout without it is missing the method many buyers reach for first.

3What a missing method costs

Survey data on checkout abandonment show the cost of getting this wrong. Among US online shoppers who abandoned a checkout for a reason other than browsing, three reasons concern payment directly.

Reason given	Share of abandoners	What it points to
Did not trust the site with card information	19%	Offer methods that do not require typing card details
The card was declined	10%	Offer a second method and measure declines per method
There were not enough payment methods	9%	Offer the methods local buyers expect

Source: Baymard Institute survey of US adults who had abandoned an online purchase, excluding those who were only browsing; respondents could give several reasons⁴.

These are US figures, from a market where cards dominate. In markets where cards are less common, the share of buyers who find no familiar method is likely to be higher, though we have found no comparable survey to confirm it.

4Trust is part of the method

The 19 percent who would not trust a site with card details are not irrational. Research on online purchasing consistently finds that trust in the seller shapes the intention to buy, alongside how useful and easy the site is⁵. A consumer decision model for electronic commerce finds that trust lowers perceived risk and raises purchase intention, and that both trust and risk affect the decision directly⁶. A payment method the buyer already uses, where they authorize the payment in their own bank or wallet app and the merchant never sees their credentials, lowers the risk the buyer has to accept from an unknown foreign store.

5A decision rule for the first set of methods

We propose that a merchant choose its launch methods in a new market from three questions, answered from public sources before launch.

1. What do adults in the market hold? Use account ownership and payment use data for the country from the Global Findex¹ and, where available, from the national central bank.
2. Is there a widely used instant account-to-account system or a dominant local wallet? Central bank and committee reports list the systems in operation³.
3. How do buyers pay in person, and does that carry online? Central bank payment diary studies, such as the euro area survey, show the mix².

The launch set is then card acceptance for the major networks, plus the most used local account-to-account or wallet method, plus any method that question 3 shows is common for online purchases in that market. Every method is measured from the first day by checkout share, authorization rate and abandonment at the payment step, so a weak choice is visible within weeks.

6Limitations

This paper argues from public aggregate data and does not estimate the effect of adding a specific method in a specific market. The abandonment figures are self-reported and come from US shoppers. Account ownership figures describe adults in general, not online shoppers, who are likely to be better banked. Fees, settlement times, currency conversion and fraud exposure also differ by method and can outweigh the conversion effect; we do not treat them here.

7Conclusion

Payment habits are local. Account ownership, card use, instant payment systems and in-store habits vary from market to market, and payment-related reasons alone account for a large share of abandoned checkouts. A merchant should choose its launch methods for a new market from what local buyers hold and trust, using public sources read before launch, and measure each method from the first day.