Payment Methods and BNPL Trends in Australian E-commerce

Australian online shoppers mostly pay by card, increasingly through digital wallets, with PayPal still the preferred online method for most age groups and buy now pay later (BNPL) used by a smaller but steady share. BNPL is now regulated as credit, and the Reserve Bank has been reviewing card surcharging and merchant costs. For retailers, the practical task is to offer the methods your customers expect at checkout, then make sure every method's fees and payout timing are reconciled, because each one settles differently.

How Australians pay in 2026

The Reserve Bank's 2025 Consumer Payments Survey shows online buying is now a normal part of everyday spending. Online payments made up around 20% of all consumer payments in 2025, up from 18% in 2022 and just 4% in 2007 (RBA, 2026). Cards remained the most widely used method overall, and the survey found shares for BPAY, PayPal and BNPL remained broadly stable as a share of payments.

Digital wallets are the clearest shift. By the end of 2025, Apple Pay, Google Pay and Samsung Pay accounted for around 45% of all card payments by number, mostly in person, though wallets also speed up online checkout by pre-filling card details (RBA, 2026).

Preferences differ by age. Australia Post's research found PayPal was the most preferred online payment method for Millennials, Gen X, Baby Boomers and Builders, while Gen Z most often preferred digital wallets (Australia Post, 2025).

Where BNPL fits now

BNPL grew quickly but remains a modest share of spending. The RBA says BNPL transactions have more than doubled over five years but made up 2% of retail payments in 2025 (RBA, 2026). Interest among younger shoppers is still rising: more than 4 in 10 Gen Z and Millennial shoppers expect to use BNPL more over the next five years (Australia Post, 2025).

Regulation has also changed. Laws extending the National Credit Code to BNPL took effect on 10 June 2025, and ASIC told providers without a credit licence to apply (ASIC, 2025). The obligations sit with providers, not retailers, but they may affect approval rates and how BNPL is presented to customers.

For merchants, BNPL works differently from cards. Afterpay, for example, charges merchants a fee made up of a fixed amount plus a percentage, and pays the remaining balance typically within up to five business days of an online purchase (Afterpay, 2026). Compare that fee with your card processing cost and include it in your margin calculations.

Surcharging and card costs are under review

In July 2025 the RBA put forward proposals to remove surcharging on designated debit, prepaid and credit card networks, lower interchange caps and make card costs more transparent, particularly to help small merchants (RBA, 2025). If you currently surcharge card payments, check the RBA's latest decisions and timing before planning pricing or checkout changes.

Does offering more payment methods increase sales?

Missing a preferred method does cost some orders. Australia Post found that when their preferred method is not offered, 45% of Baby Boomers and Builders and 20% of Gen Z and Millennials say they would abandon the cart and shop elsewhere (Australia Post, 2025). Baymard's US research lists "there weren't enough payment methods" as the reason for 9% of abandonments among shoppers not just browsing, well behind extra costs at 40% (Baymard, 2026).

Australian small businesses lag on this. CPA Australia found only 48% of Australian small businesses receive more than 10% of sales through digital payment options such as PayPal and Apple Pay, compared with a 72% survey average across Asia-Pacific (CPA Australia, 2026).

A sensible mix for most Australian online stores: cards with digital wallets enabled, PayPal, and at least one BNPL option if your average order value and customer age profile suit it.

The finance side of every payment method

Each method adds its own fee structure, settlement timing and refund process. Cards may settle in a couple of days, BNPL within a few business days, and marketplaces on their own cycle. Every extra method is another report to reconcile, another fee line and another source of refunds and disputes. Our guides to cash-flow forecasting and refunds and chargebacks show how to keep these under control.

Key figures

• Online payments were around 20% of consumer payments in 2025, up from 4% in 2007 (RBA, 2026).
• Digital wallets made up around 45% of card payments by number by the end of 2025 (RBA, 2026).
• BNPL was 2% of retail payments in 2025, after transactions more than doubled in five years (RBA, 2026).
• 45% of Baby Boomers would abandon a cart if their preferred payment method was missing (Australia Post, 2025).

How eComChannels helps

eComChannels branded storefronts give you a fast, search-ready web store connected to your order management, so you can sell direct alongside your marketplaces and offer the checkout options your customers expect. Direct sales also avoid marketplace commission on those orders.

eComChannels Finance auto reconciliation then matches payouts from each payment provider and marketplace to the underlying orders, applies the fee rules for each method, and flags missing or short payments. You can see the real cost of each payment method next to the sales it brings in, and decide which options to keep without adding reconciliation hours. Book a demo or start a 30-day free trial.

FAQ

Should I offer buy now pay later on my online store?

If your customers are younger or your order values are mid-range, there is a case for it. Weigh the merchant fee against conversion and order value in your own data, and review it after a few months.

Can I still surcharge card payments?

The RBA has been reviewing surcharging, and proposed in 2025 to remove it on designated card networks. Check the RBA's latest decision and any legislation before making changes.

Which payment methods matter most online in Australia?

Cards (including through digital wallets) and PayPal cover most shoppers. Add BNPL where it suits your audience.