30% of 100 major online retailers were offering new payment methods as an alternative to credit cards in December 2007, up from 24% in February, according to a study by Brulant, a provider of interactive marketing and web site design services.


The study showed the highest alternative payment adoption rates for the Bill Me Later deferred billing service, at 21%, followed by PayPal at 19% and Google Checkout, 10%. 5% of the companies in the study offered all three of these payment methods.


“One of the most surprising findings is the increase in retailers offering all three alternative payment methods,” says Brulant principal Adam Cohen, noting that none of the same retailers offered all three methods in February 2007. “Today we find 5% adoption of all three at a variety of retailers from Toys ‘R Us to PetSmart to Rite Aid. This reinforces the ‘customer is king’ mentality, as retailers begin to offer a multitude of choices for checkout.”

Brulant also notes that 76% of online retailers surveyed accept private label gift cards as a payment method.

The study found that PayPal scored the largest increase in adoption between February and December 2007, at 217%, while the adoption of Google Checkout doubled. PayPal, a subsidiary of eBay Inc., is a third-party payment service that pays merchants on behalf of consumers, who fund their PayPal account with payment cards or bank accounts. PayPal also offers PayPal Pay Later, a deferred payment system that, like Bill Me Later, lets consumers make payments over time, often as part of a retailer’s promotional plan.

Google Inc.’s Google Checkout lets shoppers pay with their credit and debit cards through a streamlined checkout process. Google has offered merchants free card processing, an offer that ends Jan. 31. After that, online retailers will be able to process $10 in purchases free for every $1 they spend on Google’s AdWords search marketing program. Otherwise, Google will charge 2% of the purchase amount plus 20 cents.