Ask an Expert: European Payment Solutions

“Ask an Expert“ is an occasional feature where we ask ecommerce experts questions from online merchants. For this installment, we address a question concerning European payment solutions from Rashda Ali, commercial manager, Europe, with Comvita.com, a New Zealand-based retailer of health-related products.

For the answer, we turn to Tomasz Bak, project manager with Selleo.com, an Internet development firm in Bielsko-Biała, Poland.

If you have a question you’d like to submit, email Kate Monteith, staff writer, at kate@practicalecommerce.com and we’ll attempt to address it.

Rashda Ali

Rashda Ali: “We are a New Zealand-based supplier of nutritional products. We are currently in the process of changing our website and expanding into the European market. What are the best tender (payment) types to offer to our customers in Europe, especially Germany and the French territories?”

Tomasz Bąk

Tomasz Bak: “According to a European Commission study on cross-border consumer ecommerce, on average, 61 percent of orders placed online in another EU country failed, mainly because the trader refused to serve the consumer’s country of residence or did not offer adequate means of cross border payment.

“When selling to multiple countries in Europe it is necessary to take into account user payment habits in each individual country. In France, for example, debit cards dominate in both online and offline sales, while in Germany, there is a distinct preference for bank-based payment instruments such as direct debit and credit transfers.

“French buyers are likely to appreciate an off-site payment gateway, such as Ogone, while German users may find bank-based payments like DIRECTebanking.com very convenient. Technically speaking, Ogone payment services work well for buyers in Germany; however, DIRECTebanking is not present in France. PayPal is available in both countries and is gaining popularity across Europe, especially in Germany, where in March 2009 PayPal announced it had more then 10 million accounts.

“A safe choice may be Moneybookers which is connected to the domestic payment networks of many countries and allows to pay by credit card, debit card or your bank account.

“All in all, I would suggest providing buyers with the dominant payment option within each geographical market other then PayPal and credit card, which should be available to all your users. The most efficient way to achieve it is by using Moneybookers and PayPal. On the other hand, users will appreciate your direct support for their domestic payment networks.

“You can find out more about domestic payment networks from your competitors in those countries or global companies like Skype and select a country.”