Despite recent innovations in e-commerce and payments, most people still buy online the “old-fashioned” way--digging into their wallet, pulling out a credit card, and typing in the number, expiration date, and CID. However third-party payment methods are quickly offering innovation, allowing buyers to purchase online without squinting at or scanning in a credit card.
According to a 2017 study from the Baymard Institute1, there’s “a clear sub-group of users now relying strongly on third-party payment methods.” In fact, 8 % of online shoppers abandoned their carts in the last quarter because their preferred third-party payment option wasn’t offered.

There are several reasons why third-party payment services have become instrumental to the online retail industry, but the primary reason is security.
Third-party payment options take all the guesswork out for users—and can make your checkout process seem even more safe and convenient by association.
It can take a lot of time and effort to establish trust with consumers, especially if you’re a small company. The third-party payment options take out a lot of the guesswork for buyers—and can make your checkout process feel even safer and convenient by association. Here are some checkout scenarios that greatly benefitted from offering third-party payment options.
International transactions
According to the Baymard study, international users are particularly likely to use a third-party payment option when placing an order from another country. These users turn to a third party because an independent business can provide additional security in the event that something goes wrong with an order. To quote one international customer from the research study:
“I think it’s easier. Also, if something happens where they claim it’s shipped, but I don’t receive it— what do you then do? I’m not a lawyer. So what do you do in that situation?”
A third party because an independent business can provide additional security in the event that something goes wrong with an order.
Third-party payment options offer assurance around a retailer’s security and reliability; not only that, these payment options offer ease and convenience.
In case of credit card issues
It’s always good to have a Plan B. In case of credit card errors, third-party payment options can mean the difference between a forgotten cart and a successful transaction. According to the Baymard report, up to 4 % of all users experience credit card validation errors. A third-party payment option can be a safe alternative in case something goes wrong with a user’s preferred payment method. As Baymard explains, “This fallback option proved particularly effective for the group of users who had brief, prior experience with the third-party option.”
That’s why, as Baymard explains, 83 % of the top 60 grossing e-commerce sites use third-party payment options. Offering at least one third-party provider during checkout can reduce the risk of cart abandonment, especially if your customer base is international.
1 Checkout Optimisation and Reducing Abandonments (2017), commissioned by Amazon Pay