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Dutch way not the highway

When you hear ‘The Netherlands’, you would have a couple of things popping up in your memory. Tulips, right? Coffeesh…freedom, right? Skilled worker migration heaven? Or — and trust me on this, absolutely horrible, obsolete, unbelievably tiresome online payment experience.

The Netherlands is one of those benchmark European countries that hosts awesome(st) global fintech companies, and at the same time up till recently forced its own citizens to use age-old special standalone devices to authenticate payments with bank cards online. Oh, the irony.

Special devices, you’d say in surprise, my well-educated reader? Well, the thing is that the Dutch banking system had the banks united into the iDEAL system in mid-2000s. It is quite an achievement for the local banks and, as a result, cheap and fast local bank transfers for Dutch residents. When you have such a nice unity between banks, you don’t really need Visa and MasterCard making up bridges for you.

So the following happened. When nice people of Netherlands got introduced to iDEAL, each person and legal entity got an opportunity to enjoy quick and cheap local money transfers and payments. From bank account to bank account. No bank card data needed. Perfect for local websites. Wait… what about non-local? Um…

If you’d rather pay on the non-local website, you need the card. Here is the catch — you’d better have a credit card. Maestro cards or PIN cards, as they are called there, were actually forbidden for online payments due to safety concerns. The problem is — everybody has just them, and not the credit cards with their small limit.

Now it’s 2019. Good people of Netherlands are not limited to local e-commerce, actually very much exposed to the global one. And yet paying with the local bank card online still remains a huge problem today, even though things are slowly changing. Hell, usual Dutch PIN cards do not even have any card number, just IBAN number. Which makes it even harder to pay online the way we are used to.

For many local banks there are still no modern safety mechanics employed, and their clients have to carry a chargeable device that issues a PIN. If you were Dutch, you would do these steps to pay with your bank card online:

  1. Select iDeal option on the merchant website.
  2. Select your Dutch bank from the drop-down menu.
  3. Authenticate yourself on the bank page (redirect) or via the mobile app. Now there is QR-code, which makes this step faster.
  4. Insert the debit card into e.dentifier.
  5. Enter the 8-digit code on the device which is shown to you on the website .
  6. Enter the 4-digit permanent PIN code on the device.
  7. e.dentifier will provide another unique 8-digit code which needs to be entered on the bank page.
  8. Bank authenticates and authorizes the payment, you are being redirected to the merchant website and order confirmation page.

Talk about conversion. But to be just, ABN-AMRO, the largest local bank, finally got rid of this legacy and moved the authentication / authorization flow into its mobile app.

Up till now Dutch banks were not really motivated to modernize the card payments flow, while they had iDeal. Now there is something going on, thanks to PSD2. At least, one of the biggest payment event of the year in the Netherlands — Dutch ING finally enrolled its debit cards to ApplePay. About time!

So there you have it. While Adyen, WorldPay, Ingenico Dutch HQ employees build the best worldwide online acquiring products, care about conversion metrics, optimize payment flows and boost alternative systems in various countries, they had to put up with this ancient scenario back at home.

Good thing change has finally came.


July 15, 2019
Special thanks to my special contributor — Konstantin Surkov.


What the Money is a lifestyle channel about fintech, e-commerce, business and innovations by Anna Kuzmina. From Russia. With love. Follow Anna on MediumTelegram или на Яндекс.Дзене.




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Anna Kuzmina

Anna Kuzmina



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21 Jan 2019



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