Market entry is one thing in and of itself, understanding the payment landscape of a particular region hinges on the knowledge and understanding of the predominant preferred payment methods that are popular among consumers.
This is an argument Arnon Borensztajn, Head of Enterprise Platform and Product Enablement at PayU, writes for Payment Expert in detail, breaking down the payment language of various countries and outlining why a one-size-fits all approach does more harm than good.
You wouldn’t send an e-newsletter written in French to your customers in Brazil. There’s no arguing with that statement: it’s obvious to the point of absurdity.
So why isn’t this logic being applied throughout customers’ e-commerce journeys?
The e-commerce landscape has never been more global, yet paradoxically, never more fragmented. For retailers seeking to enter new markets, success hinges on localisation. Every strategy – from marketing to packaging, consumer touchpoints to payments – should be adapted to fit the intricate ecosystems that already exist.
In the case of payments, this reality becomes starkly apparent at checkout, where consumer preferences vary from market to market. What works in Central Eastern Europe (CEE) might not work in Latin America (LatAm). The companies with a one-size-fits-all approach to checkout are the same ones struggling with cart abandonment and lost revenues.
The most sophisticated global retailers understand this complexity and embrace it, recognising that localisation is a strategic imperative. They know first-hand that the route to global success begins with acknowledging that every market has its own payment language.
The complexity of localisation
Understanding local payment preferences requires insight into the nuances that exist even between neighbouring countries. CEE is a prime example. Despite geographical proximity, countries in the region display diverse payment behaviours. In Poland, the account-to-account payment method, BLIK, is the dominant mobile payment method, while Czech consumers opt for online bank transfers and card payments.
This granular understanding of preferences becomes increasingly important as consumer expectations evolve. Consumers are embracing alternative payment methods beyond traditional payment cards (debit, credit, prepaid), from digital wallets to buy now pay later (BNPL). For example, digital wallets such as Google Pay and Apple Pay account for 10% of all online transactions in Romania, and BNPL solutions saw more than a 100% increase in use last year.
Furthermore, based on PayU GPO’s transaction data for 2024, the average shopping cart value for instalment payments in Romania is approximately three times higher than for full-payment transactions. This indicates that extended instalment payments with zero interest contribute to higher average order values and increased overall sales, with instalment payments representing up to 30% of total transactions on some merchant websites.
In Nigeria, alternative payment methods using Software-as-a-Service (SaaS) account for 70% of payment volumes. Consumers’ preference towards internet and mobile banking mean that varied payment solutions are essential to increase and retain customers.
These differing payment preferences often reflect deeper cultural, economic and technological factors. In some markets, regulatory requirements create further complexities. Strong Customer Authentication (SCA) in Europe, for instance, means a shopper in Poland will have an entirely different checkout experience to a consumer in Nigeria.
Local acquiring capabilities also play a crucial role in maximising approval rates. Processing payments locally, rather than at a global scale, means significantly reduced declined transactions for merchants. This approach results in faster settlement times and lower interchange fees by avoiding the international fees that eat into profit margins.
It’s also worth considering shopping habits as a piece of the localisation puzzle. In LatAm, e-commerce is forecasted to reach 419 million by 2029. Retail moments in the calendar also continue to grow in importance across the region, with TPV on Black Friday in 2024 increasing by 28% YoY, and e-commerce merchants in the digital entertainment and fashion industries seeing particular success.
Data-driven strategies for sustainable growth
Payment data serves as an incredibly valuable resource for merchants, offering insights that go far beyond transaction metrics. Through analysing payment patterns, merchants can identify emerging payment trends at a regional, national or even municipal level, understanding specific points of success or friction early. In turn, merchants can make strategic adjustments to their payment infrastructure, potentially capturing market share from competitors who remain tied to rigid, standardised approaches.
Harnessing this data allows merchants to grasp hidden revenue opportunities that often go unnoticed. For instance, smart routing technology improves approval rates by directing transactions through optimal payment pathways, while instant retry capabilities can recover much of the estimated $430bn in legitimate transactions declined annually.
For merchants operating in diverse markets, any data analysis must address multiple dimensions simultaneously. For instance, high-value products often benefit from instalment payment options, particularly in markets like CEE where such methods have strong cultural acceptance.
Meanwhile, subscription models can boost adoption and retention by implementing both one-click payment set-up and automatic recurring payments. This makes the initial subscription fast and easy, and eliminates the need for customers to manually complete transactions each month.
Sustainable, long-lasting growth is best achieved through combining technical optimisations with deep local payment expertise. Rather than building specialised knowledge in-house for each market, forward-thinking merchants should seek to partner with payment providers who possess both the technology and regional know-how. This approach elevates payments from operational function into an asset for higher customer experience, revenues and bottom lines.
Payment localisation isn’t a one-time implementation. It’s a process of continuous refinement. The payment landscape ebbs and flows as new technologies emerge, consumer preference shifts, and regulations change.
If there’s one certainty in a globalised marketplace, payment strategies can no longer be treated as an afterthought but a core driver of business performance. Payment infrastructures must speak the consumer’s language, both literally and figuratively. For merchants seeking to expand this year, localisation isn’t a choice, but the safest route to sustainable, profitable growth on the global stage.
