Purchase on Invoice: Why you as an online retailer should offer this payment method
The payment method Purchase on Account is often the decisive tool to turn hesitant first-time visitors into paying customers. In this article, you will learn why this payment method is so important in Swiss e-commerce and how you can easily offer it in your shop with Payrexx.
Linda
Rajan
As an online merchant, it is crucial which payment methods You offer Your buyers. The figures speak for themselves: According to the E-Commerce Sentiment Barometer 2024 by HWZ, purchase on invoice, at 70%, is still one of the most popular payment methods.
That merchants have also recognised this is shown by the Online Merchant Survey 2024 by ZHAW: Around 72 percent of Swiss online merchants offer this method. For 34 percent of them, purchase on invoice even accounts for a revenue share of more than 50 percent. So anyone who does not offer this payment method forgoes potential revenue.
In addition, no other payment method satisfies the need for control and security in online shopping as well as this one. First-time visitors in Your web shop often want to review Your goods and services before they actually pay for them. This gives them the assurance that the ordered product meets their expectations. That is exactly what purchase on invoice enables.
Generate more revenue thanks to stronger trust
The basis of trust You create by offering purchase on invoice works in both directions. On the one hand, You give Your customers the assurance to inspect the goods first. On the other hand, You show that You rely on their fairness regarding payment. A study by HWZ on the success factors in Swiss e-commerce confirms that precisely this perceived security significantly lowers the barrier to purchase, especially for new customers.
Many people are also sceptical about shopping online – especially when they have to enter sensitive data, such as credit card details. The purchase process is often abandoned at exactly this point. With purchase on invoice, You overcome this hurdle: Your customers can obtain the goods or services conveniently and usually only need to provide their delivery address.
Ultimately, purchase on invoice also has a positive effect on the revenue of Your online shop. If You offer this payment method, Your business appears more credible, You can significantly reduce purchase abandonments and increase the conversion rate, especially with new customers. Data from the Netcomm Suisse association regularly show that the lack of preferred payment methods is one of the main reasons for cart abandonment. Satisfied customers are also more likely to return and recommend Your shop to others.
Protect Yourself against any possible risks
Although the advantages of purchase on invoice clearly outweigh them, this payment method also involves some challenges. For example, it may happen that You ship the goods, but Your customers do not make the payment. Such a situation can cause major difficulties, especially for smaller merchants with limited resources. And the manual effort involved in managing incoming payments, reminders or debt collection processes should not be underestimated.
It makes even more sense to pass on the effort and responsibility. Studies by Lucerne University of Applied Sciences on accounts receivable management at SMEs emphasise that outsourcing the processes to specialised providers not only minimises the risk of payment default, but also preserves Your own liquidity and significantly reduces the administrative burden.
The good news: There are various purchase-on-invoice providers that take on the risk of payment default as well as the verification of buyers, the so-called credit check, for You. Below, we take a look at all these options and explain how You can use them with Your Payrexx account.
The following providers can be connected with Payrexx via third-party providers:
POWERPAY
With POWERPAY, developed by MF Group AG, You can offer Your customers purchase on invoice with an instalment option. POWERPAY takes over the credit check and the risk of payment default. This provider is ideal for shops focused on the Swiss market, where customer satisfaction and security are the priority.
CembraPay
Give Your customers the greatest possible flexibility by offering them purchase on invoice from CembraPay as a payment method, with or without an instalment option. A unique solution in Switzerland – without interest or additional fees. For You as a merchant, with guaranteed default risk and pre-financing. CembraPay helps You achieve a higher conversion rate and increases Your revenue.
Ideal Payment
Ideal Payment is a good solution for small and medium-sized enterprises that want to agree terms individually and adapt processes to their business model. With Ideal Payment, You get a secure invoice purchase solution without high fixed costs or complicated integrations. This provider is particularly interesting for You as a merchant if You want to start with little effort and still present Yourself professionally.
The following provider is available within the payment provider Payrexx Pay Plus developed by Payrexx:
Klarna
Klarna is perfect for merchants who sell their products internationally. Klarna is established across Europe and builds trust with customers, especially within medium-sized and larger shops. In addition to the classic purchase on invoice, Klarna offers options such as “Pay later”, instalment payments or financing.
Purchase on invoice is far more than just a payment method that You offer as a merchant. It is a strategic instrument that directly addresses new customers' need for security and trust. If You offer this option, You can secure a clear competitive advantage. And with Payrexx, these benefits can be easily transferred to Your online shop.
