Receiving Payment From Your Customers

The payments market in Australia is well-developed and continuing to make great strides every year, with Australians being early adopters of new technology. Consumers and retailers alike in this location have a variety of online payment options to choose from, though there are some clearly delineated payment preferences. Australia was ranked 4th in the world for the number of non-cash transactions during 2014.


Importantly, online payment preferences differ depending upon whether an Australian consumer is making a purchase from a foreign online shop, as opposed to a domestic one. The corresponding responses were given when respondents were asked to select their top 3 overall payment methods when making online purchases.

When respondents were asked to select their top 3 payment methods for purchasing from a foreign online shop, the corresponding responses were given:


UK Retail M-Commerce Sales, 2011-2019


  • The UK is one of the world’s foremost countries when it comes to mobile payments.
  • By 2019 it is anticipated that mobile will account for 42.6% of online payments in the UK.
  • Almost half (42%) of all mobile users in the UK (up from 26% in 2013) are now routinely making payments via mobile devices.
    8/10 consumers express some concern about mobile payments services, with the most common worries surrounding security (57%) and privacy (48%).


By accepting both payment via credit/debt cards and PayPal, international retailers will likely be able to receive payment from the vast majority of Australia’s online consumers.


Bank cards account for the greatest proportion of online spending in Australia. Interestingly, in recent years there has been a shift from credit card to debit card usage. In 2005, just over half of all card purchases were made using a credit card. Today, this number has dropped to around 33%.

Number of credit and charge card accounts: 16.05 million
Number of debit card accounts: 40.78 million
Bank cards have proved to be so popular in Australia because of their high penetration and the overall safety of transactions. Credit cards, do, however, have associated transaction costs.


Australians are one of the world’s greatest users of online banking, both on traditional computers and mobile devices. Indeed, over 80% of Australians use online banking to pay bills and purchase goods and services with their phones. ‘Pay-anyone’ transfers, or, the transfer of funds directly into a seller’s bank account is another popular payment method for online goods and services in Australia, however it is now used much less frequently than bank cards and PayPal.


E-retailers into Australia can choose between two main types of payment service provider when it comes to accepting payments from customers based in the territory. Such providers enable purchasers to pay by bank card or electronic transfers without the merchant having access to personal financial information.

Payment gateways, e.g. Merchant Warrior, IP Payments and SecurePay, link an e-shop with a merchant account, allowing the immediate transfer of funds. Online sellers have increased control under this method as they own both the gateway and the merchant account. Australian banks also offer their own payment gateway services, e.g. MasterCard Internet Gateway Service, which also powers the gateways of around seventy banks in the Asia-Pacific region as a white label service.

Third-party processors, e.g. Paypal, eWay and Stripe, do not require sellers to have a merchant account and are often cheaper and easier to set up in the short term. These payment mechanisms, however, do not settle funds on a daily basis and associated fees may be higher.

Just under half of Australian businesses accept customer payments using methods such as PayPal or digital wallets, with this number expected to rise in the near future. 64% of these companies say that electronic payment methods are ‘extremely’ or ‘very’ critical to their business. Over 5.5 million Australians are Paypal account holders.

In terms of mobile transactions, Australians tend to place the most trust in their banks, with 73% of respondents reporting the use of banking services on mobile devices. Financial institutions such as Visa and Mastercard and money transferal services such as PayPal and Western Union fall quite significantly behind with only 26% of interviewees using these payment services on mobile devices.

Mobile payment apps, then, are at a relatively early stage in Australia, particularly when compared with mobile banking applications. This, however, is likely to change in the near future. Deloitte predicts mobile payments will increase in 2015 due to a ‘clear appetite for use’, and there are continuously new entrants and technologies in the payments sphere.



Australia’s New Payment Platform (NPP) is an industry initiative designed to develop a new infrastructure for fast, flexible, low-value payments in Australia. It is expected to become operational in 2017.


EFTPOS (electronic funds transfer at point of sale), Australia’s most popular debit card system by transaction volume, is a technology that makes it possible for retailers to directly receive funds from a customer’s bank account via a customer’s debit card. All debit cards issued in Australia can process transactions via EFTPOS.
The EFTPOS system in Australia is made up of a variety of proprietary networks, principally operated by the major Australian banks, which all interlink with one another. Businesses wanting to process EFTPOS transactions must contract with one of the merchant service providers, and the selected provider will then rent a terminal to the merchant.

EFTPOS-based debit cards cannot currently be used to make online payment (unless they are also a credit card), leading Australian consumers to opt for other payment services. In response to their decreasing market share, EFTPOS will be introducing online payment in the near future. When implemented, due to its wide acceptance by Australians, it will be essential for merchants operating in the Australian e-market to use a merchant service provider knowledgeable with the system and its security requirements.

Other areas of interest

Meeting your regulatory responsibilities

Your chosen route to market will determine the legislative framework applicable to you when trading to Australian consumers

Reaching and engaging your consumers

Almost half of Australian consumers report that they trust domestic online stores over international ones

Getting the goods to your customers

As the 6th largest country in the world, getting to grips with the Australian logistics infrastructure can be a challenge

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