It seems that credit cards still rule the market for online commerce. eMarketer reports the following:
Data from a January 2009 Javelin Strategy and Research study reveals that credit card purchase volume will continue to grow online and command the largest market share among payment types, reaching $107 billion by 2013, up from $81 billion in 2008.
There is a slight increase in market share for debit cards, prepaid and private label cards. Says eMarketer:
… prepaid and debit cards may be viewed as ways to avoid interest charges, and private-label cards frequently have loyalty or rewards programs that give users cash or products back.
What I don’t see on this chart is an increase in alternative payment types like Bill Me Later, Google Checkout or PayPal, and that’s interesting considering what Get Elastic reported in their ECommerce Checkout Study in May 2007:
36% of Top 100 retailers offer alternative payment options such as PayPal, Bill Me Later, or Google Checkout, but conversion rates were convincingly higher at retailers who did not offer alternative payment types – more than double at retailers selling high ticket value items.
So if your payments provider supports credit and debit cards, you’re pretty well covered according to these studies (since prepaid Visa and Mastercard cards work just like a credit card on an e-commerce web site).
Incidentally, the Intellivative API supports the top payment categories in this chart (94% of market share), and it is compatible with most shopping carts.
