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Navigating Europe’s payments landscape to tap into a thriving e-commerce industry

Supercharged by new payment technology and shifting digital behaviours amidst the pandemic lockdowns, the European e-commerce industry is now expected to hit nearly $900 billion by 2027. For any merchant hoping to expand internationally, Europe is certainly a prime region.

However, despite most of the states being members of the EU and thus benefiting from the simplicity of cross-border trading, the payments ecosystem in Europe is somewhat fragmented. Consumer behaviour and payment preferences differ significantly – not only between regions, like Western Europe and Central Europe, but even between neighbouring countries.

If you take neighbouring Germany and France as an example, on the face of it, one would expect them to be very similar when it comes to preferred ways to pay. But in Germany, you will find that bank-to-bank transfers are the leading/main payment method, whereas, in France, it’s cards. That may make France seem quite American, but 70% of cards in France are issued by local schemes – Visa has just a 13% market share and Mastercard only 10%.

Taking advantage of the cross-border e-commerce within the EU’s integrated single market means merchants can expand into new markets, tap into new customers, and expand their businesses. But for merchants looking to sell in different countries across Europe, assuming a ‘one payment method fits all’ approach is a big mistake.

To truly succeed, it’s crucial they understand each country’s payment methods, which now include the hundreds of local digital payment methods that have emerged across Europe including within countries that are not part of the EU’s integrated single market, like the UK.

Emerging trends in European e-commerce

An interesting trend is that the big card markets in Europe, such as the UK, are starting to slow down. They’re still growing but they’re not growing at the same rates as they used to be.

There are now a number of smaller markets showing some interesting trends, and which illustrate just how diverse the European e-commerce landscape can be. The next few years will be very exciting for payments and e-commerce, and certain markets will likely leapfrog some of the more established ones.

Italy, for instance, is forecast to reach a value of $75 billion by 2026, making it one of the most promising European e-commerce markets. And volume is shifting from traditional card rails to newer rails, such as wallets and bank transfers.

When it comes to which payment method Italians prefer to use online, our data reveals that wallets now lead the way, used in 34% of all online transactions, with the share of cards down to 32%. Popular up-and-coming payment method, Satispay, became Italy’s second fintech unicorn last year and now has more than 300,000 merchants using its platform.

Even the credit card market in Italy is unforgiving to e-commerce merchants who assume they can fall back on the payment options they offer in the UK or the US – almost 40% of the credit cards circulating in Italy were issued by local schemes rather than big international names.

Interesting trends to watch

A market to take note of is Poland, worth around $28 billion annually. Poles pay for just 18% of online purchases using credit cards, whereas they use bank transfers to pay for 54%, and e-wallets power 18%.

Blik, which enables its 13 million active users to make instant payments using only their mobile banking app, is one of the standouts in the Polish market and one that merchants should familiarise themselves with.

Another market to watch closely is Portugal. Whilst it isn’t as developed as some of its European peers, it’s moving quickly towards e-commerce and online payments.

The Portuguese use credit and debit cards to pay for less than 25% of all online purchases. For the remaining 75%, consumers predominantly use bank transfers or an e-wallet.

A particularly favoured Portuguese payment method is MB WAY, which opens up a consumer base of more than 5 million users. With a 45% market share of domestic e-commerce transactions, it’s one that merchants targeting the Portuguese market simply can’t afford to leave off their checkout. 

Italy, Portugal, and Poland are just a few examples of how varied the payments landscape can be across Europe and the EU’s integrated single market. With e-commerce developing quickly in each individual country, merchants must be able to adapt to local payment methods at pace. Understanding and catering to the preferences of each jurisdiction is a key factor in unlocking the European e-commerce industry leading to the success of market penetration.


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James Booth

James Booth

VP Head of Partnerships, EMEA


Member since

25 Jan 2022



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This post is from a series of posts in the group:

The future of Payments in Europe

With an increase in regulations and growing involvement from multiple players, the world of payments is undergoing a disruption across the region

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