APMs: The Future of Payment Processing?

The landscape of payments, especially digital, is changing at a rapid pace. Every merchant running a local or a global store need to use alternative payment methods (APMs) to grow their business. These methods provide customers with more options to make a payment, reduce difficulties in payment transactions, and help new businesses localize in new countries and markets.

Business owners need to understand the impact and benefits of APMs on digital payments. Most customers used to shop online through their credit cards. However, many of these transactions failed, and it was annoying for customers. There was a need for alternate, versatile payment techniques, and that’s where APMs came into the fold.

Over 60% of consumers in the UK have stopped online shopping because of troubles during payment. Online store owners want to provide multiple payment options to customers during checkout. It is not enough to accept just credit or debit card payments these days as customers want to use their preferred payment methods.

Businesses can lose customers if they do not let them pay how they wish to. Customers like using alternative payment methods, and both local and online merchants need to adapt. Sooner rather than later, APMs are going to rule the digital payments industry.

What is an Alternative Payment Method?

Any type of payment that does not include cash or any credit/debit card issued by a bank can be classified as the alternative payment method (APM). There are multiple types of APMs available worldwide, including mobile payments, digital wallets, prepaid cards, bank transfers, etc. Even cryptocurrencies and money orders are examples of popular APMs.

Money transfer between banks is slow, especially in the case of international transactions. APMs make use of a different system than traditional credit cards. The use of APMs means lower transaction settlement times and lower processing fees for both merchants and consumers.

Emergence of APMs

APMs include all payment options that don’t involve cash or credit card schemes. Companies are not restricted to traditional methods these days and offer multiple payment options for their users. PayPal was the first big player in the digital payment industry. It began as Coinfinity and allowed people to make international transactions at low processing costs. Earlier, people were used to expensive and slow third-party companies, and PayPal changed the game.

After this, there was an explosion of different APMs like Stripe, Apple Pay, etc., making waves in the digital payment industry. Different nations have different banks that charge high rates for international payments. APMs provided an effective solution for this problem.

Most merchants are incorporating the use of APMs because the customers’ shopping and payment habits are evolving too. Everyone wants to make payments hassle-free, something which traditional payment methods didn’t offer. The machinery and technology used at checkout points have become advanced, which makes it convenient for merchants to accept multiple different APMs.

Importance of APMs

APMs hold a lot of value today, and every merchant or business needs to provide customers with multiple payment options. Here are the benefits and importance of using APMs.

·        Customers get the choice and convenience they are looking for while making payments through APMs. Every person can use a form of payment that suits them if the merchant offers multiple options for payment. By accepting APMs, businesses can get an edge over competitors who just accept traditional payment options and cash.

·        Businesses that want to enable cross-border payments and expand globally are helped a lot by using APMs. Most countries are served by major credit cards, but some emerging countries prefer using local methods and APMs to make payments. This helps businesses expand and connect with locals of emerging nations. Payment getaways like Paypound help process international payments at low exchange rates and accept over 170 currencies.

·        When a consumer searches for a product online, there are many E-Commerce stores selling the same product at similar prices. As a result, customers prefer shopping where the user experience is better, and they can make payments using various methods. This will also help build trust and confidence with your consumers, giving you an edge over competitors.

Types of APMs

There are a lot of APMs in use around the world. Let us know about some of them in detail.

Online Banking – Consumers can make payments from their bank account without entering their credit card details. They can do this on the bank’s website or mobile app, but this method was criticized for slow speeds and poor security. Open banking/PSD2 provides payment service with direct access to a bank account. Open banking allows fund transfer instantly and safely.

Digital Wallets – Digital or E-Wallets is a pre-paid account through which consumers can make payments. These wallets are protected by a password or biometric scan. Neteller, PayPal, Skrill, etc., are some popular examples. Consumers can use E-Wallets easily by linking their bank account to them.

Mobile Payments – In this type of APM, payments are made using your mobile phone. Samsung Pay and Apple Pay are the most popular mobile payments option. In some countries, consumers can use these mobile payments, and the charges are added to their monthly phone bills.

Cryptocurrencies – Recently, cryptocurrencies have emerged as a popular payment method. There are over 2000 cryptocurrencies, including Bitcoin, Ethereum, etc., worldwide. However, some of them are volatile and cannot be used to make transactions. Cryptocurrency payments are gaining traction and will be a big part of the digital payment space soon.


There is no doubt that alternative payment methods will be a huge part of the E-Commerce industry really soon. Already, in many countries, APM users outnumber consumers who use traditional payment options. For example, mobile payment is growing in Africa, while AliPay is the most used payment method in China.

Credit cards are still used by most people, but APMs are very close to their level. Consumers don’t like issues while payments and prefer to use the payment method which they like. All major payment getaways like Paypound accept APMs, and they are certainly the future of payment processing. 

Disclaimer: The views, suggestions, and opinions expressed here are the sole responsibility of the experts. No Getfincorp journalist was involved in the writing and production of this article.

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