The first in our series of payments in different countries. We start with Denmark.
Denmark is an interesting case as it was one of the first countries to go plastic with the Dankort debit card scheme in the 80s. Often early innovators see very different problems than late comers.
Visa/Dankort by is far the largest payment form on the internet by around 75-80% of all ecom transactions. There are still a few pure Dankort without Visa around, but not many.
Thereafter it is Visa and Mastercard for around 20% and the rest is ebanking payments dominated (Nordea and Danske Bank), Amex and Diners.
It should be noted that Visa/Dankort is a special Danish debit card with combined Visa and Dankort branding. When we mention Visa on it’s own it is generally a Mastercard.
Over the past 2 years the fastest growing payment type has been Visa and Mastercard as opposed to Dankort. The reason can be 2 things:
The Dankort system has special rules by law. Designed to promote low fees for consumers and merchants, there are some significant issues with them that most Danish consumers are not aware of. In particularly concerning security:
PayPal has been around for a long time in the Danish market. While they are still trying they haven’t so far achieved a significant marketshare in Scandinavia.
The big thing in payments in Scandinavia has been invoice payments, where the customer receives a short term credit decision and pays on receipt of purchased item.
The only really big player is NETS the old payment monopoly (previously PBS) owned by the Nordic banks.
Teller a company in the NETS family who does credit card acquiring in Scandinavia.
Furthermore a lot of new acquirers has entered the market. In particular Swedbank, Euroline, Barclays, Nordea.
This could be because SEPA could mean that the Dankort scheme needs to be closed. If this happens 75% of all transactions could end up in the free marketspace.
Another likely reason for entering Denmark could be the monopoly based pricing NETS has enjoyed which has been 1,25% for domestic transactions and 3,75% for all cross border transactions! They have also had a incredibly long default settlement period of 28 banking days!!!
The vast majority of Person to Person payments are done through online banking. It is very common for people to publish their bank account numbers on their website and email it out to friends for group purchases of trips etc.
While Bitcoin is still a miniscule part of the Danish payment market, the first Danish bitcoin exchange Bitcoin Nordic has been launched.
They are able to sell Bitcoin to customers with Scandinavian issued cards through ewire as well as international and SEPA bank wires.
There is even one hair salon accepting bitcoin.
The biggest issue has been the Dankort monopoly owned by NETS. Until recently it was common for supermarkets and many businesses to not accept foreign credit cards.
The Dankort monopoly has also meant that there has been a large amount of red tape to jump through for online merchants. In particular startups.
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