Shopify is one of the most straight-forward e-commerce platforms in the market. It is simple to set up and start using. It also offers easy integration for carrying out sales through social media. Furthermore, merchants who own Shopify-powered stores have the option to use a wide selection of payment gateways.
The platform even provides its own payment service, Shopify Payments, for merchants from United States, Puerto Rico, Canada, the United Kingdom, Ireland, Australia, New Zealand, and Singapore. Shopify Payments is a service provided through a partnership the platform has with Stripe. Thanks to this, once merchants from these countries create their Shopify store, they are automatically set up to accept all major card brands. However, if any of the businesses using Shopify Payments try to sell to the Brazilian market, they will see poor conversion rates.
What are the Reasons for Poor Conversion Rates in Brasil?
Stripe, as well as PayPal and other popular payment gateways, do not provide local payment processing in Brazil for cross-border merchants. Apart from being used for Shopify Payments, Stripe is a popular payment gateway around the globe. The same goes for PayPal, which is often easily integrated to any checkout page. However, when it comes to international merchants selling cross-border to Brazil, the payment processing through these gateways is limited: it can only be done in foreign currency.
Brazil is a very particular market and local credit cards are not usually enabled for international purchases. Even when they are enabled for payments in foreign currency, Brazilian consumers tend to avoid doing so. Here we explain more about why they avoid purchasing online in foreign currency.
Because over 70% of the cards issued in the country do not support international payments, merchants who do not use a local payment gateway that can offer payment processing in BRL to their buyers will inevitably be faced with low conversion rates. In addition, only a local payment processing service can offer alternative Brazilian payment methods, such as boleto bancário and installment payments. Boletos bancários are bound to drive further conversions as they are responsible for nearly a quarter of all online payment transactions in the country.
Conversion Rate Booster with Local Payment Processing
The results of switching payment processing from an international gateway to a local payment provider are instantly visible. PagBrasil has a plugin for Shopify and recently started working with a merchant who was previously using Stripe to process payment from Brazilian consumers. The store’s conversion rate was averaging 17% with Stripe, which is in fact more than many businesses will see with an international provider, depending on their segment. Within hours of activating PagBrasil’s plugin and starting processing payments in BRL, in addition to offering installment payments – a must have in Brazil, the store registered 86% of conversion rate. Some businesses can even enjoy conversion rates over the 90% mark with a local provider.
To learn more about the benefits of choosing a local payment provider for Brazil, contact us.
