Is iDeal the real deal for European ecommerce? Dutch payment method iDeal is set to be rolled out across the entire European market. Merchants looking for a smooth transition to the new European payment solution should start investigating this now.

What is iDeal?

If you’re doing business in the Netherlands or planning to expand into the Dutch market, there’s one payment method that is essential to boosting sales and increasing customer loyalty: iDeal.

In 2004, Dutch banks ABN Amro, ING Bank, Postbank and Rabobank announced they would join forces to provide an interoperable payment platform. This platform was named iDeal. By enabling iDeal at checkout, merchants would make it easy for their customers to make online payments in real-time, 24 hours a day, with low transaction costs, regardless of their bank affiliation.

For the Dutch ecommerce sector, iDeal was a total game changer. Before the introduction of iDeal, customers would either transfer funds manually, or scroll through a long list of banks and payment methods that would transport them to various payment portals.

For a more visual explanation of how iDeal works, take a look at this explainer video:

iDeal adoption in the Netherlands

In the Netherlands, using iDeal is a basic fact of life. There are now about 130,000 entities that offer iDEAL, and more than 1.2 billion iDEAL payments take place each year. It is used for the payment of just about anything you can imagine; from webshops to municipal taxes, from traffic fines to energy bills.

One great benefit of this payment method is its versatility; iDeal can be offered via websites and social media platforms, or sent as payment links through SMS and WhatsApp messages. Just like with regular credit card checkouts, all the relevant payment information (e.g. amount due and merchant information) is already pre-filled, meaning the user only needs to confirm the payment at checkout, typically through a challenge on their device.

iDeal: European success story?

The Dutch's reliance and preference for iDeal as the ideal (pun intended) payment method used to set them apart from many other countries. This, however, is expected to change in the near future, as the European Payment Initiative (EPI) recently acquired the Dutch payment system, with the goal of making it a standard payment solution across European countries.

After several years of operation in the Netherlands, iDeal has received unexpected attention from authorities, including the European Payment Initiative, which recently acquired the Dutch payment system with the goal of transforming it into a standardized European payment solution.

In response to this news, iDeal emphasized its dependability, efficiency. According to iDeal, 70% of all e-commerce transactions in the Netherlands are completed via iDeal, demonstrating the solution's trustworthiness, effectiveness, and overall fit to most European markets.

It is yet unclear when the first countries will be able to take advantage of iDeal's features, however, one thing is certain: iDeal will eventually become a European payment standard, optimizing how all consumers behave in the payment sector.

Drawbacks of using iDeal?

We had to think long and hard about this. Frankly, there aren’t that many reasons to be wary of the most popular payment method in the Netherlands.

• To use iDeal, the merchant and customer need to be affiliated with one of the participating banks. For customers in the countries that will adopt iDeal, this shouldn’t be much of a problem as all major bank cards will be supported.
• Although using iDeal, is the equivalent of a bank transaction, the transaction costs are a bit higher compared to a manual transfer.

Is your business ready for iDeal?

If you’re looking to do business or improve your performance in the Netherlands and later in the whole of Europe, then accepting iDeal payments is a must. Adopting the local (regional) preference will inspire confidence among your customers and minimize friction at checkout.

With one of the top economies in the world and excellent living standards, The Netherlands, a relatively small country with a population of 17.4 million, is a highly coveted market for online merchants. In 2022, online spending by Dutch consumers reached €33.3 billion, an increase of 9% from 2021.

If you're considering offering it as a payment option, here's what you need to know:

Pay and go
iDeal makes it simple for shoppers to pay directly from their bank accounts. Once the shopper selects iDeal as their payment method, they're securely redirected to their bank's online banking environment. There, they can log in, approve the payment, and receive a confirmation instantly.

Support and compliance
iDeal offers extensive support for its users, ensuring smooth transactions and compliance with banking regulations. Businesses need to ensure that their system is configured to work with iDeal's code structure to avoid payment disruptions.

Preventing chargebacks
One of the most significant advantages of using iDeal is the reduced risk of chargebacks. Since customers confirm transactions directly with their banks, businesses can confidently process sales without worry.

Check your integration
Make sure to check that your system is fully integrated with iDeal. Regular tests and updates will help maintain a seamless payment process for your customers.

Recommended Reading: New payment method: Tikkie.

Questions? Get in touch with an expert

Where do you begin, and how do you integrate iDeal within your current systems? Many questions are sure to arise, some more complex than others. It might be a good idea to have a no-strings-attached conversation with one of our profit boosters. Get in touch with us today through our contact form, or request a demo of our Checkmaxx e-commerce solution to discover ways of incorporating iDeal into your current systems.