Last editedMar 20202 min read
What if we asked you to buy what we're selling right now?
It’s too soon. This could be the first time you’ve ever come across whatever product or service we're peddling. The purchasing cycle for a new product or service, whether we’re talking about consumers or businesses, can be long and complex. Not always, but it can be (particularly within the B2B space). So you want to get it right.
There’s one factor in this process that you might be undervaluing right now - the payment experience. Amy Konary, VP of Business Innovation at Zuora and Chair of the Subscribed Institute says:
“Today’s customers expect more than just a great product… They are rejecting the traditional “one size fits all” approach and embracing personalised services… Give me what I want, when I want, how I want, is the mandate. They want the freedom to consume on their terms. Their need for freedom and choice extends to payments as well.”
By failing to account for the payment preferences of your customers, all the time and money you spend nurturing them through your marketing and sales funnel could be for nothing. Your competitors who offer them a superior payment experience - that is, a superior customer experience - are going to take your customer instead.
But if you account for payment preferences within your market, you can increase your conversion, improve customer loyalty, and ultimately reduce your churn.
Below we’ve collated payment preference data, provided by YouGov, for both recurring business payments (B2B) and recurring consumer payments (B2C) in Australia.
Recurring payment preferences of Australian businesses
Australian businesses demonstrate a clear preference for paying by bank-to-bank payment methods, such as and bank transfer.
Bank transfer is preferred for regular business bills and invoices, with more than 60% of businesses likely to use it in each case.
Bank debit is preferred for instalments and digital subscriptions, with more than 50% of businesses likely to use it in each case.
Corporate card holds a lead over digital wallets like PayPal - which is in last place - in terms of preference. Around half of respondents were likely to pay via corporate card in each of the four most common recurring payment use cases (see tables below), with preference for digital wallet trailing a few percentage points behind.
Regular business bills
e.g. utility or insurance bills
| Payment method | Unlikely to use | Neutral feeling | Likely to use |
|---|---|---|---|
| Corporate card | 18% | 32% | 49% |
| BECS Direct Debit | 11% | 29% | 59% |
| Bank transfer | 9% | 29% | 62% |
| Digital wallet | 24% | 29% | 44% |
Invoices
e.g. from accountants or marketing agencies
| Payment method | Unlikely to use | Neutral feeling | Likely to use |
|---|---|---|---|
| Corporate card | 18% | 29% | 51% |
| BECS Direct Debit | 10% | 30% | 59% |
| Bank transfer | 8% | 27% | 64% |
| Digital wallet | 24% | 32% | 44% |
Digital subscriptions
e.g. products like cloud storage software
| Payment method | Unlikely to use | Neutral feeling | Likely to use |
|---|---|---|---|
| Corporate card | 18% | 29% | 49% |
| BECS Direct Debit | 12% | 31% | 56% |
| Bank transfer | 10% | 35% | 53% |
| Digital wallet | 21% | 28% | 48% |
Instalments
e.g. paying off business loans
| Payment method | Unlikely to use | Neutral feeling | Likely to use |
|---|---|---|---|
| Corporate card | 19% | 29% | 51% |
| BECS Direct Debit | 11% | 30% | 59% |
| Bank transfer | 10% | 31% | 57% |
| Digital wallet | 24% | 30% | 44% |
Recurring payment preferences of Australian consumers
Consumers in Australia were highly likely to choose BECS Direct Debit for household bills and instalment payments.
For online and traditional subscriptions, they showed slightly higher preference for credit cards, followed closely by BECS Direct Debit and debit cards. Interestingly, Australian consumers also showed a high dislike towards credit card and digital wallets like PayPal for both types of subscription payments.
Online subscriptions
e.g. Netflix or Spotify
| Payment method | Unlikely to use | Neutral feeling | Likely to use |
|---|---|---|---|
| Credit card | 32% | 28% | 38% |
| Debit card | 29% | 32% | 36% |
| BECS Direct Debit | 29% | 32% | 36% |
| Digital wallet | 35% | 27% | 34% |
Household bills
e.g. energy bills
| Payment method | Unlikely to use | Neutral feeling | Likely to use |
|---|---|---|---|
| Credit card | 29% | 27% | 41% |
| Debit card | 23% | 33% | 43% |
| BECS Direct Debit | 18% | 33% | 46% |
| Digital wallet | 38% | 29% | 28% |
Instalments
e.g. car loan
| Payment method | Unlikely to use | Neutral feeling | Likely to use |
|---|---|---|---|
| Credit card | 36% | 27% | 34% |
| Debit card | 28% | 30% | 38% |
| BECS Direct Debit | 21% | 28% | 46% |
| Digital wallet | 39% | 30% | 27% |
Traditional subscriptions
e.g. gym membership or newspaper subscription
| Payment method | Unlikely to use | Neutral feeling | Likely to use |
|---|---|---|---|
| Credit card | 31% | 26% | 39% |
| Debit card | 27% | 33% | 37% |
| BECS Direct Debit | 29% | 34% | 35% |
| Digital wallet | 38% | 27% | 32% |
Key takeaways
The payment experience you offer your customers is a key part of your overall customer experience - don’t ignore it
Payment preference is very divisive - even payment methods which are most preferred still see a significant percentage of businesses unlikely to use them at all
No single payment method covers enough market preference to warrant ignoring the potential need for a multi-method payment strategy
Learn more about payment preferences and the impact on your business
Whether you’re looking to optimise conversion and reduce churn in your local market, or are expanding into international markets and want to know which payment methods reign supreme - check out our reports on the state of payment preferences today:
![[Report] Global payment preferences for recurring B2B purchases](https://images.ctfassets.net/40w0m41bmydz/3Sx4oPTWqV3OFgftVGB7Oq/ea2fb2af6adb6a05d1c2de391e6396ff/global-payment-preferences-b2b-report-hero.jpg?w=1200&h=1510&q=50&fm=webp)
[Report] Global payment preferences for recurring B2B purchases
We surveyed 4,990 businesses across 9 markets to determine which payment methods businesses prefer for different use cases.