There's no such thing as 'alternative' in payment methods anymore

When Visa and Mastercard became the dominant standards decades ago, anything that wasn't them got a label: alternative.

Since then, most people stopped to question this and the term persisted, the way industry jargon does when repeated enough. But when a Dutch shopper checks out online, iDEAL accounts for more than 60% of transactions in the Netherlands. It is not an "alternative" to anything but rather the payment method. Similarly, in Brazil, Pix - a real-time payment rail built and regulated by the Central Bank - has reshaped how millions of people move money. In Poland, BLIK is how people pay.

While in India, UPI is infrastructure as essential as the roads people drive on.

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APMs and LPMs: Rails versus experience

That said, the industry does need vocabulary. The two terms - Alternative Payment Methods (APMs) and Local Payment Methods (LPMs) - are often used interchangeably, but the distinction between them is worth understanding as a lens for making better decisions on where and how to expand your business.

A useful starting point:

LPMs move money on local rails. But APMs also change how those rails are accessed.

LPMs are usually built on specific national or regional infrastructure (SEPA in Europe or local instant payment rails in Brazil). They comply with local regulation, settle in local currency, and carry the trust of local financial institutions. They exist because of where they were built, not just where they’re used.

Alternative Payment Methods (or APMs, as they are more commonly referred to), is the broader umbrella term that can cover wallets, Buy-Now-Pay-Later (BNPL), and digital-first experiences that often run on top of existing bank accounts or card networks. For example, when you pay with Apple Pay, your underlying bank account or card is still doing the work but Apple Pay changes the experience of paying through biometric authentication, fewer fields, a faster checkout.

In short, LPMs can be a subset of APMs. What makes something an LPM is that it is built into and trusted within a specific geography. What makes something an APM is simply that it is not a traditional card or cash payment.

With that said, these categories are not fixed. For example, BLIK started as a strictly Polish method but is now expanding into Slovakia and Romania. Wero is pan-European but still built on SEPA Instant and EU banking governance, which makes it better suited as an LPM. While Klarna began as BNPL and has since become a full wallet with its own digital app, shopping tools, price comparisons, cashback rewards, and AI-driven features like personalized budgeting and deal-finding across its 118 million active users globally.

Payment methods evolve. The goal is not to classify them perfectly but to understand what your customers trust.

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How payment methods get built

Ask consumers why they use the payment methods they use and the answer is almost always the same: "It is fast, it is familiar, and it requires the fewest clicks."

The methods that get adopted are usually the ones that reduce friction for the user, while methods that add friction get abandoned. This is not incidental to the history of local payment methods - and is why many of today’s dominant LPMs launched first as peer-to-peer tools, won consumer trust in that frictionless context, and only later expanded into commerce.

For example, the most dominant LPMs today share a common architecture: there are local banking rails underneath, with a technology and UX layer on top. Somebody looked at the banks present in a given country, built an interface that allowed consumers to leverage those banks in a seamless way, and gave it a name. iDEAL in the Netherlands, Bancontact in Belgium, Bizum in Spain, BLIK in Poland - they follow the same pattern: issuing banks plus a technology layer. A method that feels native to the market uses the infrastructure people already trust.

Wallets (APMs) follow a different pattern. Apple Pay, Google Pay, MobilePay, Vipps - these are layers built on top of cards or bank accounts. The underlying cost of a Google Pay transaction is the same as the underlying card cost but what changes is the consumer experience.

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How to speak the right market language

PayPal is not Italian. It was founded by Max Levchin, Peter Thiel, and Luke Nosek in 1998 in Palo Alto, California (and then known as Confinity). But in Italy, PayPal is one of the most trusted and widely used payment methods. This means offering it as a payment method to Italian customers is a local decision, even though PayPal is technically a global product. Conversely, if you were to offer BLIK to shoppers in Italy today, they would look at you blankly. It does not matter how excellent the product is - if it is not part of how Italians pay.

A payment method can be classified as “local” if consumers in a given market love it and use it - regardless of where it was invented. LPMs, in this sense, are less like product categories and more like languages. If you want to do business in Italy, the payment equivalent of speaking "Italian" is understanding which methods Italian consumers actually trust, and making sure they appear at checkout.

When entering a new market, identify the two or three methods that cover 80–90% of consumer payment behaviour in that market and make that your local stack. Whether those methods are technically LPMs or globally available APMs matters less than whether they are what the people in that market actually use.

“You go to Italy and you don’t speak Italian — believe me, it’s frustrating. It’s the same with payments.”

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When payments fail to become infrastructure

Pix was launched and regulated by Brazil’s Central Bank as real-time, account-to-account rail that reduces reliance on international card schemes, lowers transaction costs for businesses and consumers, and brings financial services to a population that was historically underserved by traditional banking. It achieved in months what years of industry-led initiatives had not.

In Thailand, PromptPay was built on the same principle - a QR-code-based national system designed to reach consumers across diverse economic segments, including those who had never had a bank card. In Kenya and across sub-Saharan Africa, M-Pesa extended financial services to communities where a bank branch had never existed. In Mexico, OXXO cash vouchers allow unbanked consumers to participate in e-commerce by paying in person at one of 20,000+ convenience stores.

All of these are customer access points that determine whether a merchant can reach a customer at all - not just whether checkout is convenient. The real-world consequence of getting payments infrastructure right is not just about approval rates and conversion but also about who gets included in commerce, and who does not.

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Breadth versus depth

But merchants expanding across markets often face a dilemma.

They might read an article like this and the case for supporting local payment methods is clear: higher conversion, better approval rates, local credibility, and in some markets, access to consumers who have no alternatives. In fact, EY finds that more than 85% of surveyed merchants plan to expand APM and LPM support over the next one to three years.

But support at global scale is not always straightforward. Each LPM typically means a separate integration, localised compliance requirements, settlement nuances, and ongoing scheme updates. As merchants expand into additional markets, the technical overheads can compound quickly.

The right response, of course, is not to offer everything - or simply to offer something - but rather to understand which methods matter most in each target market, and to work with infrastructure partners who hold the underlying complexity, so that merchants do not have to.

“Infrastructure is about giving merchants one integration instead of a hundred. You can connect to local and alternative payment methods one by one, but that takes time, focus, and resources most businesses don’t have. Nuvei’s role is to close that gap — so teams can spend less time wiring payments together, and more time building their business.”

— Imri Meir, SVP of Global Expansion, Nuvei

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The payments infrastructure provider should not just process transactions, but make sure merchants can show up in new markets without rebuilding from scratch every time.

One integration. The right methods. And local credibility, everywhere.

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The language we use shapes the strategy we build

Going back to language, the hierarchy of “alternative” versus “traditional” that organised the payments industry for nearly two decades no longer reflects how consumers think, pay, or decide. When a shopper in Warsaw selects BLIK, when someone in São Paulo chooses Pix, when a buyer in Amsterdam opts for iDEAL - they are not choosing an alternative to anything. They are selecting what works for them and what they inherently trust.

The merchants who strive to grow in these markets start with the question: ‍

"What does this market’s commerce actually look like, and how do we show up in a way that earns trust from day one?"

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APMs or LPMs - the taxonomy is less important than knowing what your customers use, offering it, and making sure the infrastructure behind can hold when volume surges.

For every payment, everywhere.