2019 J.P. Morgan Global Payment Trends

2019 Global Payments Trends Report - Belgium Country Insights

BELGIUM INSIGHTS REPORT


Belgium is a small market but one that is outward looking when it comes to online shopping. Retailers and payment providers that can provide a wide range of goods, secure payment options and can navigate the country’s sometimes disparate regulations regarding trading, should find success. To help our clients locate, attract and keep their customers, we have tracked and assessed e-commerce developments in 34 mature and emerging markets around the globe.

Introduction

 

The outlook is positive for Belgian e-commerce: disposable income is set to increase in the country in 2019 and 2020, which should help support expansion in the e-commerce sector in the mid term.1 This is being driven by employment growth, which is causing competition for labor and is subsequently pushing wages up.2 In 2018 unemployment fell to 6.3 percent from 7.1 percent in 2017, while consumer spending is also ticking upwards.3 As a result, the Belgian e-commerce market is predicted to grow strongly, at 8.5 percent per year to 2021.4

This document is based on projected figures and is subject to change at any time.

A slow start to domestic e-commerce supports Belgium’s single-digit growth prediction

 

The Belgian online shopping market is expected to grow at a compound annual growth rate of 8.5 percent to 2021,15 a relatively modest rate compared with its immediate neighbors, France and the Netherlands. The country’s business to consumer e-commerce market value stands at €10 billion,16 a figure that represents about 1.9 percent of overall European e-commerce sales.17

However, there are positive signs of an evolving market. E-commerce penetration has increased for the first time in four years, from 74 percent to 76 percent,18 and as transaction volumes rise, so too could basket spend. Belgians spend an average of €1,473 a year online, much less than the European average of €2,186.19 Spending is focused on one-off purchases of services and experiences, with airline travel, package holidays, entertainment tickets and digital media all major categories purchased online.20

The online shopping market has historically been hindered by the split in Belgium between French-speaking Wallonia and Dutch-speaking Flanders, as it requires international firms to operate across two different languages and cultures. Meanwhile, some country-specific rules have also slowed progress. For example, federal legislation prevented e-commerce businesses from having employees work overnight shifts until recently, which restricted the ability for next-day deliveries.21

 

International brands lead the way

 

These issues with domestic e-commerce have enabled international retailers to dominate the Belgian online landscape – the top five are all foreign entities. US giant Amazon is number one, followed by the Netherlands’ Coolblue and Bol.com, and German firms Zalando and MediaMarkt.22 E-commerce merchants based abroad are courting a market willing to shop overseas: 63 percent of Belgian online shoppers have made a cross-border purchase within the last year.23 Dutch e-commerce providers in particular have stepped in to fill the gap left by slow-moving domestic businesses by opening dedicated Belgian sites with .be addresses.24

This international dominance might wane in the coming years as increasing numbers of local retailers launch e-commerce offerings, and overnight working at domestic e-commerce hubs becomes acceptable.

Time-saving and convenience benefits are the main drivers of e-commerce growth in Belgium, so there is an obvious reward for companies that highlight prompt and convenient delivery services.25 For orders from overseas, the country has strong logistics capabilities thanks to its geographical positioning and the presence of three international airports. Delivery services are also set to improve as major domestic postal services rebrand and re-invest in themselves to become e-commerce-focused. For example, Belgian postal service Bpost is repositioning itself to become an online shopping-focused logistics company.26

Discount and loyalty apps drive Belgian mobile commerce

 

The average Belgian checks their smartphone at least 34 times a day,27 and this activity is starting to translate into e-commerce sales. Around 15 percent of all e-commerce transactions in Belgium are now completed on a mobile device.28 The Belgian mobile commerce market is worth €1.5 billion and is forecast to grow at a compound annual growth rate of 14 percent to 2021, to reach a value of €2.6 billion.29

E-commerce merchants wishing to court on-the-go Belgian shoppers should focus their efforts on developing strong app offerings. Apps have already overtaken browsers to become the most popular way to shop on the move: 54 percent of transactions are now completed using this method, compared with 46 percent on a browser.30 The top three shopping apps on the Belgian Apple App Store are H&M and brand platforms Wish and Zalando.31 There are also a number of loyalty and discount apps included in the top 10 apps, revealing a strong appetite for voucher, promotion and discount-led shopping. These apps include virtual loyalty card wallet Stocard and discount site Zalando Lounge.32

Belgian shoppers can also be targeted via social media with 83 percent of Belgian internet users active on social networks, 62 percent of them on a daily basis. This figure increases to 80 percent for the group aged 16 to 24.33 Facebook, Facebook Messenger, WhatsApp and Instagram are the most-used platforms. With the exception of WhatsApp, each of these platforms incorporate shopping functions. The market share of Snapchat and Instagram is at its highest with 18 to 24 year olds, and both of these platforms offer retailers highly visual, dynamic channels to promote their products.34

Domestic cards dominate but bank transfers gain ground

 

Visa® and Mastercard® are both well-recognized brands in Belgium,35 and Belgians opt to use cards to pay for 50 percent of all online shopping, or €5 billion worth of transactions.36 Bancontact, formerly Mister Cash, is a popular domestic card payment option and is co-branded with Maestro. For international merchants, Maestro, Visa and Mastercard are the primary ways to access the market.

Bank transfers are the main alternative to paying with card: online payments via bank transfer are projected to grow the fastest out of all payment methods, at a compound annual growth rate of 25 percent to 2021, to take a 32 percent share of all online transactions by that point.37 Bank transfers, however, can pose problems with security and issues like reconciliation.

 

Alternative payment options on the rise  

 

Digital wallets are the second-fastest growing payment method, expected to rise at a compound annual growth rate of 20 percent to 2021.38 PayPal® already takes a significant share of this market, at 10 to 15 percent.39 Belgian banks have invested in mobile payment capabilities and mobile banking, both factors that should drive acceptance and usage of digital wallets.40 In addition, major international brands are using Belgium as a place to trial innovative digital payment options. Total, for instance, has chosen Belgium and Germany to begin rolling out a digital wallet that allows shoppers to select and pay for their gasoline via their smartphone.41

The Single Euro Payments Area Instant Credit Transfer was launched in November 2017 and, as of late 2018, 13 Belgium-based payment service providers had joined. The scheme provides instant crediting of up to €15,000 across member states. However, Belgium has decided that there will not be a limit for domestic transactions and has committed to execute instant payments within five seconds.42

Build shopper confidence through local trust-marks

 

Fraud is estimated to occur for one percent of all customers buying products online in Belgium.43 These levels are under the European average44 as Belgians highly value security and trust, which is reflected in their behavior when shopping online. Belgian citizens are three times more likely than Germans to successfully complete the 3D Secure authentication process when completing a transaction online.45 E-commerce merchants can engender trust with shoppers by registering for Belgian online security trust-marks such as those issued by BeCommerce and SafeShops.be.46 Chargeback rates, at 0.03 percent,47 are low compared with other European countries included in our study*, potentially because popular domestic card Bancontact does not offer chargeback services.

Key takeaways

 

  • Belgium’s e-commerce market is worth €10 billion, with a projected compound annual growth rate of 8.5 percent to 202148
  • Around 15 percent of all e-commerce transactions in Belgium are now completed on a mobile device49
  • Belgian consumers use cards to pay for 50 percent of all online shopping, or €5 billion worth of transactions50
  • Digital wallets are the second-fastest growing payment method, rising at a compound annual growth rate of 20 percent to 202151

 

Data may vary from historical figures, due to certain categories being re-stated as new information sources have become available.

* J.P. Morgan 2019 Payments Trends – Global Insights Report series includes the following European countries: Austria, Belgium, Czech Republic, Denmark, Finland, France, Germany, Ireland, Italy, Luxembourg, Norway, Poland, Portugal, Spain, Sweden, Switzerland, The Netherlands, UK.

 

Global Payments Trends Reports

International e-commerce success can hinge upon understanding the needs, nuances and growth patterns of individual nations. J.P. Morgan’s Global Payments Trends Reports aims to offer merchants the knowledge they need for global success through in-depth, country-by-country analysis.

About J.P. Morgan

 

J.P. Morgan offers a full suite of payments services to enable a seamless connection across the payments continuum for clients. We bring our consultative expertise, data-driven insights, and local service around the globe to provide a more unified view of payables, receivables and cash management. Merchant Services is the payment acceptance and merchant acquiring business of JPMorgan Chase & Co. (NYSE: JPM) – a global financial services firm with assets of $2.6 trillion and operations worldwide.i According to The Nilson Report, it is also the top merchant acquirer of e-commerce transactions in Europe.ii

 

i JPMorgan Chase & Co. Q4 2018 Earnings Report 2018.

ii The Nilson Report, #1132 May 2018.

For more information, please contact:

 

Your J.P. Morgan Relationship Manager or visit: https://www.jpmorgan.com/europe/merchant-services/payment-insights

 

Information contained in this document has been prepared by third parties or obtained from sources which are believed to be reliable; but neither Chase Paymentech Europe Limited nor any of its affiliates warrant the completeness or accuracy of the information contained herein. Chase Paymentech Europe Limited and any of its affiliates shall have no liability to the user or to third parties, for the quality, accuracy, timeliness, or for any special, indirect, incidental or consequential damages which may be experienced because of the use of or reliance on the data or statements made available herein. Third party trademarks, brand names, products and services are only referential and Chase Paymentech Europe Limited and its affiliates disclaims any sponsorship, affiliation or endorsement of or by any such third party.

 

Chase Paymentech Europe Limited, trading as J.P. Morgan, is regulated by the Central Bank of Ireland. Registered Office: J.P. Morgan, 200 Capital Dock, 79 Sir John Rogerson’s Quay, Dublin 2 D02 RK57, Ireland. Registered in Ireland with the CRO under the Registration No. 474128.

Directors: Catherine Moore (UK), Carin Bryans, Dara Quinn, Steven Beasty (US), Eilish Finan

Copyright© 2019

1 European Commission, ‘Autumn economic forecast – Belgium.’ Accessed January 2018.

2 European Commission, ‘Autumn economic forecast – Belgium.’ Accessed January 2018.

3 Western Europe Economic Research, JPMorgan Chase Bank, January 2019.

4 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

5 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via World Bank, 2017.

6 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via CIA, 2017.

7 World Bank Open Data. ‘Belgium’. Accessed December 2018.

8 GFK.com, March 2018. ‘Belgian ecommerce hits new milestone of € 10 billion turnover in 2017.’ Accessed November 2018.

9 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

10 GFK.com, March 2018. ‘Belgian ecommerce hits new milestone of € 10 billion turnover in 2017.’ Accessed November 2018.

11 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via Eurostat, 2017.

12 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via Newzoo, 2018.

13 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via World Bank, 2017.

14 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via ECB Statistical Data Warehouse, 2018.

15 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

16 GFK.com, March 2018. ‘Belgian ecommerce hits new milestone of € 10 billion turnover in 2017.’ Accessed November 2018.

17 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

18 Comeos.be, June 2018. ‘E-Commerce Belgium 2018.’ Accessed November 2018.

19 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

20 GFK.com, March 2018. ‘Belgian ecommerce hits new milestone of € 10 billion turnover in 2017.’ Accessed November 2018.

21 Ecommercenews.eu, 2018. ‘Ecommerce in Belgium.’ Accessed November 2018.

22 Ecommercenews.eu, 2018. ‘Top 10 online stores in Belgium.’ Accessed November 2018.

23 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via Eurostat, 2017.

24 Ecommercenews.eu, 2018. ‘Ecommerce in Belgium.’ Accessed November 2018.

25 Comeos.be, June 2018. ‘E-Commerce Belgium 2018.’ Accessed November 2018.

26 Ecommercenews.eu, July 2018. ‘Bpost raises €650m for ecommerce transformation.’ Accessed November 2018.

27 Deloitte.be, 2017. ‘State of the Smart: Consumer usage patterns of the smartphone.’ Accessed November 2018.

28 GFK.com, March 2018. ‘Belgian ecommerce hits new milestone of € 10 billion turnover in 2017.’ Accessed November 2018.

29 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

30 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

31 Statista.com, October 2018. ‘Leading iPhone shopping apps in Belgium 2018, by downloads.’ Accessed November 2018.

32 Statista.com, October 2018. ‘Leading iPhone shopping apps in Belgium 2018, by downloads.’ Accessed November 2018.

33 Deloitte.be, 2017. ‘State of the Smart: Consumer usage patterns of the smartphone.’ Accessed November 2018.

34 Deloitte.be, 2017. ‘State of the Smart: Consumer usage patterns of the smartphone.’ Accessed November 2018.

35 Ingenico.com, December 2017. ‘Thoughts on connecting with Belgian consumers.’ Accessed November 2018.

36 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

37 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

38 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

39 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

40 Ingenico.com, December 2017. ‘Thoughts on connecting with Belgian consumers.’ Accessed November 2018.

41 Total.com, January 2018. ‘Total ewallet launched in Europe.’ Accessed November 2018.

42 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via European Payments Council, 2018.

43 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via Eurostat, 2017.

44 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via Eurostat, 2017.

45 Ingenico.com, December 2017. ‘Thoughts on connecting with Belgian consumers.’ Accessed November 2018.

46 Ingenico.com, December 2017. ‘Thoughts on connecting with Belgian consumers.’ Accessed November 2018.

47 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided by J.P. Morgan Merchant Services.

48 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

49 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

50 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

51 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

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