It’s vital then, that for anyone accepting payments to embrace the world of alternative, or local, payment methods.
What is an alternative payment method?
Put simply, an alternative payment method (APM), also known as a local payment method (LPM), is a payment which isn’t made by cash or card, i.e. a payment which isn’t paid by traditional means. If you use, say, PayPal or Visa Checkout, you’re using an alternative or local payment method.
With people increasingly making use of digital wallets, biometrics and online banking, APMs are becoming more and more popular.
Why are so many customers choosing to pay by alternative payment methods?
It’s largely about security and convenience. When purchasing from an unfamiliar website, there’s reassurance in seeing familiar payment pages pop up when it comes to handing over one’s hard-earned money.
The customer’s APM of choice will be a well-known brand and electronic form that they recognise and trust. In addition, with many APMs adding an additional layer of both buyer and seller security, purchasing from unknown territories or regions isn’t as scary as it used to be.
And, of course, it’s so much quicker and more convenient to enter an email address and password. Taking into account that many APMs such as Visa Checkout now also offer a one click checkout process, payments can be made in record speed.
3 quick steps to ensure you’re maximising opportunities for growth
1. Identify your customers’ spending preferences
Whatever you’re selling, look at the payment behaviour of the country and the demographic groups you’re targeting. You can boost conversion rates by up to 70% if your website is properly localised, such as including support for locally preferred payment methods.³
2. Decide which payment options to offer
Providing choice and convenience is clearly a benefit and helps drive purchase. You may be able to get a flexible arrangement with your PSP so you can start with as many or as few APMs as you’d like, then add or remove to suit your evolving needs as your business grows.
3. Make sure implementation is as smooth as possible
Complicated, separate integrations take up valuable resources, both in terms of income and staff time, so make sure your payment provider makes it as easy as possible to set up and maintain those methods.