by Fintechnews Switzerland
October 23, 2023
Online retailers are rapidly adopting mobile wallets in Switzerland and Austria, with local companies Twint as well as Apple Pay and Google Pay strong, according to a new report by Zurich University of Applied Sciences (ZHAW) and the Innsbruck Management Center. Showing traction (MCI).
The report, titled “Onlinehandlerbefragung 2023”, aims to understand the current state of online commerce and the various trends emerging in this field. Based on a survey conducted in September 2023 among online shops.
The survey results show that mobile payments are growing in Switzerland, with Twint in particular attracting attention. In 2023, mobile payment apps will be the second most integrated payment method among Swiss online merchants after credit cards (90%), and in 4 out of 5 Swiss online shops surveyed ( 79%) said they supported Twint.
Twint achieves remarkable growth
Twint is a Swiss mobile payment method founded in 2016 that allows users to connect their bank accounts and cards through an app and make payments online or in-store. Twint has announced that it has over 5 million users and performed a total of 386 million transactions in 2022. This number is higher than all years combined since the app’s release, demonstrating the accelerated growth seen over the past few years. .
Taking a closer look at historical data, the report reveals that Twint is the fastest growing payment method in Switzerland. In 2018, only 24% of Swiss online shops supported this payment method, but this proportion has rapidly increased to 52% in 2021 and 74% in 2022.
Twint’s rise in Switzerland is indicative of a broader trend in the country’s e-commerce sector, where mobile payment apps are gaining adoption faster than any other method. This trend is evident in the foreign platforms Apple Pay and Google Pay, which are also gaining popularity not only among Swiss online retailers but also Austrian merchants, with an acceptance rate of less than 4% in 2018. Currently, this has increased to approximately 20%.
On the other hand, traditional methods such as credit cards, bill payments, PayPal and PostFinance, the financial services arm of Swiss Post, have recorded more moderate growth, partly due to their widespread acceptance.
Looking at broader trends, the study found that credit cards are the most commonly accepted payment method among online retailers in both Switzerland and Austria, with a penetration rate of 90%. . PayPal ranks second in Austria (83%), where the online payment method is much more popular than in Switzerland (55%).
Klarna, a leading BNPL (Buy Now, Pay Later) solution provider, is another payment method that is rapidly gaining adoption among Austrian retailers, compared to only 6% of Swiss retailers. In comparison, 47% of retailers have adopted it.
Payrexx emerges as top payment service provider among Swiss online retailers
The study also sought to find out which payment service providers Swiss and Austrian online retailers partner with to process their transactions, with Payrexx accounting for 27% of mentions, compared to Switzerland’s smaller online retailers. It turns out to be the most popular provider among shops.
Founded in 2015 and based in Thun, Switzerland, Payrexx is an online payment platform for small and medium-sized businesses that allows merchants to support all major Swiss payment methods from a single source. The company claims to have 50,000 customers.
After Payrexx, PayPal accounted for 23% of mentions, followed by Worldline’s Saferpay (22%) and PostFinance E-Payment (19%).
In Austria, PayPal is the most prominent payment service provider (57%), ahead of Stripe (24%) and Mollie (17%).
Online retailers were also asked if they supported a BNPL agreement, with 11% of respondents saying they did. This figure is lower than his 2022 figure, where 17% of online retailers offered his BNPL payment option.
Online stores that offered BNPL arrangements said they most often worked with Klarna (BillPay) (29%), followed by MF Group (24%). A fairly new player on the scene, CembraPay placed him in third place with 18% mentions of him.
CembraPay, a brand born from the merger of Byjuno and Swissbilling, was founded in April 2023 and offers a wide range of payment solutions, including BNPL and embedded payment services.
Other BNPL solutions used by online retailers in Switzerland and Austria include HeidiPay, Bob Pay, PayPal Plus, Ideal Payment, Twint Pay Later, and Unzer (Payolution).
With the increasing use of payment apps among consumers, the adoption of mobile payment functions among Swiss merchants is rapidly increasing. According to a 2022 study conducted by the Swiss National Bank, Swiss citizens are increasingly using mobile payment apps, with their transaction volume share increasing to 11% in 2022, up from 5% in 2020 to 6%. Points increased.
Twint is currently the most used mobile payment app in Switzerland, adopted by 57% of more than 380 Swiss residents surveyed by Statista earlier this year. Twint is followed by Apple Pay (39%), Google Pay (32%) and PostFinance (12%).
Featured image credit: Edited from freepik