APMs in 2025: What to Offer and Where

Alternative Payment Methods (APMs) continue to reshape the global payments landscape in 2025. From digital wallets to buy-now-pay-later services, understanding which APMs to offer and where can significantly impact your conversion rates and market reach.

This guide analyzes current APM trends and provides practical recommendations for merchants looking to optimize their payment method mix.

The APM Landscape in 2025

APMs now account for over 60% of global e-commerce transactions, with significant regional variations in preferred payment methods.

Global APM Adoption Statistics

Digital wallets: 52% of global online transactions
Buy-now-pay-later: 15% and growing rapidly
Bank transfers: 12% (highest in Europe and Asia)
Cash-based methods: 8% (concentrated in emerging markets)
Cryptocurrency: 3% (varies by merchant category)

✨

Offering the right APM mix can improve conversion rates by 20-35% in target markets.

Regional APM Preferences

Success with APMs requires understanding regional preferences and cultural payment habits.

North America

Digital wallets: PayPal (35%), Apple Pay (25%), Google Pay (15%)
BNPL: Klarna, Afterpay, Affirm (growing in fashion/electronics)
Traditional cards: Still dominant for high-value purchases
Emerging: Cryptocurrency payments for tech-savvy segments

Europe

Digital wallets: PayPal (40%), Apple Pay (20%), local wallets
Bank transfers: SEPA, iDEAL (Netherlands), Sofort (Germany)
BNPL: Klarna (dominant in Nordics), PayPal Pay in 4
Local methods: Bancontact (Belgium), Multibanco (Portugal)

Asia-Pacific

China: Alipay (45%), WeChat Pay (35%), UnionPay
India: UPI (40%), Paytm, PhonePe, local wallets
Southeast Asia: GrabPay, Touch 'n Go, local e-wallets
Japan: PayPay, LINE Pay, convenience store payments

Latin America

Brazil: PIX (instant transfers), Boleto, local cards
Mexico: OXXO (cash), SPEI transfers, local wallets
Argentina: Mercado Pago, local bank transfers
Regional: Cash-based methods still significant

APM Selection Strategy by Business Model

Different business models benefit from different APM strategies based on customer demographics and purchase patterns.

E-commerce/Retail

Essential: PayPal, Apple Pay, Google Pay
Regional: Local digital wallets and bank transfers
Fashion/Lifestyle: BNPL options (Klarna, Afterpay)
Electronics: Cryptocurrency for tech enthusiasts
Luxury: Traditional cards with enhanced security

Digital Services/SaaS

Primary: Credit/debit cards for recurring billing
Secondary: PayPal for one-time purchases
Enterprise: Bank transfers for large annual contracts
Global: Local payment methods for market expansion
Emerging: Cryptocurrency for privacy-focused services

Marketplaces

Buyers: Full APM suite including digital wallets
Sellers: Efficient payout methods (bank transfers, wallets)
Cross-border: Multi-currency support and local methods
SMBs: Simple onboarding with popular local options
Enterprises: Advanced payment and payout features

Emerging APM Trends in 2025

Stay ahead of the curve by understanding emerging payment trends and their potential impact.

Central Bank Digital Currencies (CBDCs)

China's Digital Yuan leading adoption
European Central Bank Digital Euro in pilot phase
Benefits: Lower fees, instant settlement, government backing
Challenges: Regulatory uncertainty, infrastructure requirements
Timeline: Limited availability 2025-2026, broader adoption 2027+

Embedded Finance

Payment methods integrated directly into apps/platforms
Social commerce payments (Instagram, TikTok checkout)
In-app wallets with loyalty and rewards integration
Contextual BNPL offers at point of sale
Biometric authentication for seamless payments

Sustainable and Social Payments

Carbon-neutral payment processing options
Donation integration at checkout
ESG-compliant payment methods
Community-based payment networks
Impact measurement and reporting

Implementation Best Practices

Successful APM implementation requires more than just technical integration.

Technical Considerations

Use payment orchestration platforms for unified integration
Implement smart routing to optimize approval rates
Ensure mobile-optimized checkout experiences
Add real-time payment method availability checking
Build robust error handling and retry logic

User Experience Optimization

Display payment methods based on customer location
Show trusted payment logos prominently
Provide clear fee transparency for each method
Optimize payment method ordering by popularity
Offer guest checkout for all payment methods

Risk Management

Implement fraud detection for each APM type
Monitor chargeback rates by payment method
Set appropriate transaction limits for new methods
Create method-specific dispute resolution processes
Maintain compliance with local regulations

💡

Start with 2-3 high-impact APMs for your target markets, then expand based on performance data.

Measuring APM Performance

Track these metrics to evaluate and optimize your APM strategy:

Conversion Metrics

Conversion rate by payment method
Payment method adoption rates
Cart abandonment at payment selection
Payment failure rates by method
Time to complete payment by method

Financial Metrics

Processing costs by payment method
Average transaction value by method
Chargeback rates and dispute costs
Currency conversion impact (for international)
Overall payment mix ROI

2025 APM Roadmap Recommendations

Plan your APM expansion with these strategic priorities:

Q1 2025: Foundation

Audit current payment method performance
Identify top 3 markets for expansion
Research local payment preferences in target markets
Evaluate payment orchestration platform options
Establish baseline conversion and cost metrics

Q2-Q3 2025: Implementation

Integrate priority APMs for target markets
Optimize checkout UX for new payment methods
Implement fraud detection and risk management
Launch A/B tests for payment method ordering
Monitor performance and gather customer feedback

Q4 2025: Optimization

Analyze full-year APM performance data
Identify underperforming payment methods
Plan 2026 expansion into emerging methods
Optimize payment routing and failover logic
Prepare for CBDC and embedded finance trends

Regulatory and Compliance Considerations

Different APMs have varying regulatory requirements that must be considered:

PSD2 Strong Customer Authentication for EU transactions
KYC requirements for high-value wallet transactions
Cross-border transfer regulations for international APMs
Data localization requirements for some regional methods
Anti-money laundering compliance for cash-based methods

🚀

TheroPay supports 200+ APMs globally with unified integration, smart routing, and compliance management. Expand into new markets with confidence using our APM expertise.