Alternative payment methods for modern businesses: a must or an advantage

Non-cash transactions are accelerating worldwide, pushing e-commerce toward a cashless default. Customers want to pay fast and friction-free, so alternative payment methods (APMs) — from wallets and instant bank transfers to local favourites — are now a key driver of checkout success.

In this article, we explain what alternative payment methods are, why adoption is rising, which APMs matter most by region and industry, and how to add the right mix without overcomplicating your payment stack.

What are alternative payment methods?

Alternative payment methods are any payment methods other than credit/debit cards or cash. Simply put, they're the ways customers pay using bank accounts, digital wallets, mobile devices, or region-specific networks.

APMs include digital wallets (Apple Pay, Google Pay, PayPal, Alipay), account-to-account and open-banking payments (instant bank transfers, Pay by Bank), mobile payment apps and QR-based payments (WeChat Pay, Pix QR, UPI), Buy Now, Pay Later (BNPL) services (Klarna, Afterpay, Affirm), prepaid and gift cards, direct debit and e-mandates, cash-based digital vouchers (PaysafeCard, OXXO), and cryptocurrency payments.

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What ties them together is that they let customers pay in the way that feels most convenient and trusted to them, often with one-click checkout, biometric authentication, or instant confirmation.

'Alternative payment methods' aren't really alternative anymore — in many regions, they're the default. Wallets lead in China and Southeast Asia, instant A2A rails like UPI in India and Pix in Brazil dominate everyday payments, and local bank-transfer options such as iDEAL are standard in the Netherlands. If you want to sell globally, you have to meet customers where they already are.

Denys Kyrychenko

Co-founder & CEO at Corefy

Types of alternative payment methods

Popular alternative payment methods cover a mix of ways customers prefer to pay today, especially online and on mobile. Below are the most common APM types you'll see globally, what makes each one distinct, and where they typically fit best in the checkout experience.

Mobile payments

Mobile payments are transactions initiated and completed on a smartphone, often through native apps or tap-to-pay flows. They usually rely on tokenised credentials and biometric authentication, making checkout faster and more secure on mobile.

Examples: Apple Pay, Google Pay, Samsung Pay, WeChat Pay (in-app), UPI apps (India), Pix apps (Brazil).

Typical use cases: mobile-first e-commerce, in-app purchases, omnichannel retail.

Digital wallets

Digital wallets store payment details or balance so customers can pay without re-entering card/bank data. Wallets can be card-based, bank-based, or stored-value, and are often the default choice for repeat purchases.

Examples: PayPal, Alipay, WeChat Pay, GrabPay, Mercado Pago, Skrill, Neteller.

Typical use cases: fast checkout, cross-border sales, markets with strong wallet preference.

Bank transfers

Bank transfers (account-to-account or A2A) move funds directly from a customer's bank account to the merchant. Customers authorise the payment in their banking app, often via open banking or instant rails, with real-time confirmation in many regions.

Examples: iDEAL (NL), Sofort/Klarna Pay Now (DACH), Trustly, SEPA Instant (EU), Faster Payments (UK).

Typical use cases: high-trust local payments, low-fraud flows, regions where cards are less dominant.

Payment installments

Instalment payments let customers split a purchase into multiple payments over time. These can be interest-free ‘Pay in 3/4' options or longer-term financing, typically approved instantly at checkout.

Examples: Klarna, Afterpay/Clearpay, Affirm, Zip, PayPal Pay Later.

Typical use cases: higher-ticket items, conversion uplift, shoppers seeking budget flexibility.

Direct debit payments

Direct debit pulls funds from the customer's bank account with their prior authorisation. It's widely used for recurring payments, subscriptions, and utilities, offering predictability and low processing costs.

Examples: SEPA Direct Debit (EU), Bacs Direct Debit (UK), ACH Debit (US), eMandates in various markets.

Typical use cases: subscriptions, memberships, recurring invoices.

Carrier billing

Carrier billing charges purchases directly to the customer's mobile phone bill or prepaid balance. It's frictionless for users without cards/banks and common in digital goods and emerging markets.

Examples: Bango, DCB platforms, operator-specific billing in SEA, LATAM, and Africa.

Typical use cases: games, streaming, micro-transactions, unbanked audiences.

Prepaid vouchers

Prepaid vouchers enable online payments using cash purchased at retail outlets or online. Customers enter a voucher code at checkout, making this a key bridge between cash economies and e-commerce.

Examples: PaysafeCard, Neosurf, OXXO vouchers (Mexico), Boleto Bancário (Brazil), retail cash barcodes.

Typical use cases: cash-reliant regions, privacy-seeking users, gaming and digital services.

Virtual cards

Virtual cards are digital, often single-use card numbers generated for a specific transaction or merchant. They add a security layer while still running on card rails, and are popular for both consumers and businesses.

Examples: Revolut virtual cards, Wise digital cards, Apple Pay/Google Pay tokenised cards, corporate virtual cards.

Typical use cases: safer online card payments, controlled B2B spending, subscription management.

Global growth of alternative payment methods

APMs grow as people form payment habits in their everyday lives and bring those habits to checkout. As a result, what feels normal to customers in one region can feel awkward or even unavailable in another. That's why global expansion or even just improving local conversion rates increasingly depends on offering payment methods that align with regional expectations.

Below is how the shift plays out across major markets and what it means for your payment mix.

Europe

Europe is steadily shifting from a card-first mindset toward wallets and bank-based payments. As open banking matures and SEPA Instant becomes the norm, paying directly from a bank app feels faster and more transparent for many consumers. Capgemini predicts instant payments will reach 22% of global non-cash volume by 2028, and Europe is one of the main engines of that growth.

Local favourites like iDEAL in the Netherlands or BLIK in Poland have set the tone: seamless bank-to-bank payments with instant confirmation. Once buyers get used to that level of convenience, typing card numbers feels outdated.

What it means for merchants: Success in Europe increasingly depends on offering trusted, locally rooted APMs. Wallets, bank transfers, and BNPL options are part of the expected checkout experience.

APAC

APAC is the world's most APM-driven region. Here, wallets and QR-based payments overtook cards early on. Super-apps like WeChat, Alipay, Grab, and GoPay turned mobile payments into a daily habit long before many Western markets caught up. Worldpay highlights APAC as the most wallet-forward region and notes the long-term surge of wallets and mobile payments globally.

This region also shows how fast adoption can move when payments align with mobile behaviour. Once people use their phones for everything — ordering food, booking rides, scanning QR codes in stores — they expect the same ease online. That's why digital wallets dominate online checkouts across most APAC countries.

What it means for merchants: If you want to convert customers in APAC, wallet-first experiences are essential. Cards alone won't meet user expectations in China, Southeast Asia, or increasingly India.

North America

North America remains card-centric, but consumer behaviour is subtly shifting. Cards are still used, just inside wallets rather than manually entered at checkout. That means customers increasingly choose Apple Pay, PayPal, or similar options first, even if the underlying payment method is still a card.

BNPL has also carved out a stable place in checkout for many categories, especially where shoppers want flexibility without leaving the purchase flow.

What it means for merchants: In the US and Canada, APMs are a conversion booster. Wallets and BNPL improve speed, reduce friction, and can meaningfully raise approval rates.

Latin America

LATAM is leapfrogging traditional payment models. Instead of slowly moving from cash to cards to digital, the region is jumping straight to instant transfers, QR payments, and mobile wallets.

Brazil's Pix is a standout example: widely used across demographics, free, instant, and embedded in everyday life. Once consumers trust a method offline, they naturally expect to use it online too.

What it means for merchants: Winning LATAM means supporting instant A2A payments, digital wallets, and cash-based digital alternatives. Card-only checkout flows will struggle with both conversion and accessibility.

Middle East

The Middle East is one of the fastest-growing regions for digital payments, driven by both government policy and consumer behaviour. Countries like the UAE and Saudi Arabia are actively pushing toward cashless economies through incentives, digital ID systems, and national instant-payment schemes.

A young, tech-savvy population, high smartphone penetration, and the rapid rollout of instant transfers make wallets and A2A payments increasingly popular.

What it means for merchants: To meet customer expectations in the Middle East, offering wallets, bank-based payments, and local digital options is becoming essential, not experimental.

Benefits of alternative payment methods

Alternative payment methods are among the most reliable ways to boost conversion and keep payments resilient across markets. As APMs now drive about two-thirds of global e-commerce value, they've become the default expectation for a huge share of customers.

• Higher checkout conversion. People abandon carts when their preferred method isn't there. Adding the right local wallets, instant transfers, or BNPL removes that friction and captures buyers who would otherwise bounce.
• Better mobile performance. Mobile shoppers want tap-and-go flows, not form-filling. Wallets and mobile payments compress checkout to seconds, mirroring how people already buy in apps and on phones. Worldpay highlights mobile-led APM growth as a primary driver of the new payments mix.
• Customer trust + access to new markets. In many regions, APMs are the mainstream (e.g., wallets across APAC, instant A2A in parts of Europe and LATAM), and people tend to stick to methods they know. If your checkout supports what they already use daily, you reduce hesitation and make returning easier.
• Higher approvals with lower fraud risk. Many APMs, especially digital wallets and bank-authenticated A2A, verify users in trusted environments (biometrics, banking apps) and use tokenisation to prevent real card or account details from being exposed. That combination reduces fraud and chargeback pressure and typically improves authorisation success versus manual card entry, meaning fewer false declines at checkout.
• Smarter cost and routing control (when orchestrated). APMs often have different fee structures than cards. When routed intelligently, they let you balance conversion and cost, choosing the best method per market, ticket size, or risk profile.

Challenges and risks to consider when implementing APMs

APMs can boost conversion and unlock new markets, but every new method changes your stack, checkout UX, and ops workload. Here's what to watch out for.

Complexity grows faster than you expect

Each APM comes with its own flow, API quirks, and ongoing updates. Add a few directly, and you’ll quickly end up with a patchwork of SDKs, redirects, certificates, dashboards, and version changes to maintain.

Risks: development time shifts from building product to babysitting payments.

Performance and risk are uneven by region

A method that crushes it in one country might underperform in another. Banks behave differently, local uptime varies, and customer familiarity isn't universal. Fraud patterns also shift by APM type (A2A vs vouchers vs BNPL), so one-size-fits-all risk rules won't hold.

Risks: carrying low-value methods and missing real fraud signals.

Checkout can get messy

APMs are great when they feel native to the customer and chaotic when they don't. Too many options, inconsistent UX patterns, or showing the wrong methods to the wrong users can create more friction than cards ever did.

Risks: decision paralysis, mobile drop-offs, and lower conversion despite more choices.

Regulation and provider lock-in

Some APMs come with licensing, local compliance, or data-residency requirements. On top of that, many methods are tied to specific local PSPs, and once a branded method becomes part of your checkout routine, switching later can get expensive.

Risks: delayed launches, compliance exposure, and reduced flexibility.

APMs are worth it, but only when added strategically. Pick methods that align with real regional demand, keep checkout clean, and continuously monitor performance. With orchestration, you can do all of that without turning your payment stack into spaghetti.

Operations get heavier (settlements, refunds, reporting)

Unlike cards, APMs don't follow a single rulebook. Settlement speed, refund logic, dispute handling, and reporting formats vary a lot by method and provider. Finance and support teams feel that pain first.

Risks: reconciliation headaches, slower refunds, and unclear cash flow.

Choosing alternative payment solutions for your business: 6 essential steps

Accepting alternative online payment methods is an opportunity to grow your sales and attract more customers. So, it would help if you were conscientious about choosing the right ones to provide the smoothest online shopping for your customers.

Here are the steps you can take right now.

Step 1. Define if your business requires it

Here are the market segments that require alternative online payment methods — check if your business is among them.

If the answer is 'yes', move to the next step.

Step 2. Map demand by region and customer segment

APMs are never universal. What converts in Germany may be irrelevant in Canada. So before choosing methods, look at:

• Where your traffic comes from/where you plan to expand
• What your users already pay with locally (wallets, A2A, BNPL, vouchers, etc.)
• Device split (mobile-heavy audiences usually expect wallets)

Output: a short list of 'must-have' APMs per priority market.

Step 3. Prioritise by impact vs effort

You don't need 20 methods, you need the right 5–7. The simplest way to get there is to rank every candidate by how much volume or conversion uplift you expect it to bring, how well it covers your priority markets, how heavy it will be to integrate and support (including checkout flow changes, refunds, reporting, and risk rules), and its real cost profile.

Output: a phased rollout with adding APMs in waves, so you get wins without bloating checkout.

Why do it? You get results early, avoid 20 useless buttons, and scale based on data instead of guesswork.

Step 4. Plan the checkout UX

APMs can raise conversion or spoil it if the UI is cluttered. Decide:

• Which methods show by default
• Which appear only by geo/currency/device/returning user
• How they're labelled (local names matter)
• Where to place them (top 2–3 should be the most relevant)

Output: a clean, logic-driven payment widget instead of a supermarket shelf.

Step 5. Pilot + A/B test before full rollout

Start with 1–2 markets or segments. Track:

• conversion uplift vs card-only baseline
• approval rates per method
• drop-off stage in the flow
• refund friction/support tickets
• fraud patterns by method

Output: validated proof of value before you scale complexity.

Step 6. Route and optimise continuously

Demand shifts and providers degrade over time, so after launch, you need to keep monitoring how each APM performs in each country and through each PSP, what it actually costs you per approved transaction, how well your fallback logic saves failed payments, and whether every method is paying for its place in the stack in terms of ROI. If a method starts underperforming or becomes too expensive, reroute traffic to a better option or retire it altogether.

Output: an APM mix that stays profitable and high-converting over time.

If your checkout is still built around cards only, you're leaving growth to chance. Customers already live in e-wallets, BNPL, instant bank transfers — and yes, even crypto in the right niches. These are already everyday habits. The businesses that win are the ones that stop asking 'Should we add alternative payment methods?' and start asking 'Which APMs do our customers consider normal and how fast can we support them?

Denys Kyrychenko

Co-founder & CEO at Corefy

How Corefy helps implement alternative methods

Corefy makes APM adoption practical, not painful. Instead of integrating each method one by one, you connect to Corefy once and get a unified layer to add and manage alternative payment options across markets.

Here's what that looks like in real terms:

If you're growing locally or going cross-border, we are ready to help you launch the right alternative payment methods quickly and keep checkout clean.