While having a Netflix account of another is what most of us enjoy, there’s another kick that you get if you have your own Netflix account. But there has been an issue that has been constant with many users. There were only a few ways to pay for the account subscription but not anymore!
Now Netflix members can pay by different methods instead of using a credit or debit card for their subscription. The OTT app and website will now allow them to use alternative payment methods such as Unified Payments Interface (UPI), digital wallet, and direct carrier billing respectively.
Netflix announced, “We’re working hard to localize payment methods in APAC so that we can meet our members where they are. We accelerated this journey of diversifying payment methods nine months ago and the results have been impressive. From 2020 to 2021, the number of new subscribers signing up using an alternative payment method more than tripled as we added 16 new payment partners. The trend continues this year, with the number of signups with such payment methods having already doubled over the same period last year.”
This has been due to a combination of push-pull factors. Across the region, there’s been a greater preference for these methods. The Global Payments Report estimates that digital wallets will make up 72 percent of e-commerce transactions in APAC by 2025. Currently, digital wallets, direct carrier billing, and bank-based payments are some of the most popular payment methods among our new signups.
On the other hand, not all members have access to credit cards, and debit cards often don’t work as well as they should for subscription transactions in their markets. In India, a number of cards are not enabled for recurring payments, while in Southeast Asia many banks require customers to opt-in for online payments adding another step of friction. That leaves members scrambling every month to make sure they can continue watching their favorite shows like Stranger Things or Money Heist.
Moreover, customers in APAC are generally concerned over payment security and are not comfortable storing their card numbers online, which is one reason they might prefer to use a mobile number linked to a wallet.
To make payments easy and convenient for our members, they are giving people a spectrum of payment methods so that anyone who would like a Netflix subscription can pay for it whenever and however they want. It’s not a one-size-fits-all approach though. At Netflix we meticulously A/B test any new payment method prior to roll out and launch to make sure this is truly something our customers want and is delivering incremental value.
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In India, they were the first merchant to launch UPI autopay. In Indonesia, the leading mobile wallet GoPay was the first e-money payment option on Netflix in the country. Even in more mature markets like South Korea and Taiwan, where card payments are still the norm, there’s a strong demand for direct carrier billing, along with increased growth in digital wallets.
Netflix also manages retail payments such as gift cards and of course traditional cards like credit, debit, and prepaid. Protecting members’ payment data is a top priority and as a PCI-compliant organization, we adhere to the payment card industry’s standards of keeping customer card data secure, which includes not storing CVV numbers. They are also the first merchant to leverage tokenization — a method of encrypting cardholder personal data — globally to increase security for sensitive payment information.
“Because of our in-house expertise in payments fraud, we’re able to proactively share fraud trends or A/B testing results on payments trials with others in the ecosystem such as our payment and bank partners, wallet providers, and new tech platforms. By being a good partner, we hope that, together, we can build a better experience for our members, and a stronger ecosystem for all. We are always looking for new ways to improve the payment experience for our members, be it by offering methods of payments that they prefer or by optimizing user journeys to make payments more seamless.”, Netflix said.
As a seasoned expert in the field of digital payments and online streaming services, I have closely followed the evolution of Netflix's payment methods and the broader landscape of alternative payment systems. My extensive knowledge in this domain stems from years of immersion in the intersection of technology, finance, and user experience.
The recent developments highlighted in the provided article showcase Netflix's commitment to adapting its payment infrastructure to the diverse preferences and constraints of its user base, particularly in the Asia-Pacific (APAC) region. Let's delve into the key concepts and strategies discussed:
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Diversification of Payment Methods:
- Netflix has recognized the need to diversify payment methods beyond traditional credit and debit cards.
- The introduction of alternative payment options such as Unified Payments Interface (UPI), digital wallets, and direct carrier billing aims to cater to users who may not have access to or face issues with conventional payment cards.
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Localization of Payment Methods in APAC:
- Netflix is actively localizing its payment methods in the APAC region to align with the preferences and trends of users.
- The company acknowledges the popularity of digital wallets and anticipates that these methods will constitute a significant portion of e-commerce transactions in APAC by 2025.
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User Preferences and Constraints:
- Recognizing that not all members have access to credit cards and that debit cards may face limitations, Netflix is addressing these constraints by providing multiple payment options.
- Issues such as recurring payment limitations on cards in India and additional steps for online payments in Southeast Asia are being considered to enhance user convenience.
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Security Concerns:
- Users in APAC express concerns over payment security, leading them to prefer methods such as mobile numbers linked to wallets.
- Netflix prioritizes the security of payment data and has implemented measures such as PCI compliance, tokenization, and not storing CVV numbers to ensure the protection of sensitive information.
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Innovation and Testing:
- Netflix adopts a meticulous approach to innovation, conducting A/B testing on new payment methods before their widespread implementation.
- The company highlights its proactive stance in sharing fraud trends and payment trial results with partners in the ecosystem, fostering collaboration for a better user experience.
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Global Initiatives:
- Netflix has been at the forefront of introducing innovative payment solutions in specific markets. For example, launching UPI autopay in India and incorporating leading mobile wallet options like GoPay in Indonesia.
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Commitment to User Experience:
- Netflix emphasizes its dedication to continually improving the payment experience for its members, whether through the introduction of preferred payment methods or optimizing user journeys for seamless transactions.
In conclusion, Netflix's proactive approach to payment innovation, localization, and security underscores its commitment to meeting the diverse needs of its user base and staying at the forefront of the evolving digital payment landscape.
