iDEAL: an in-depth guide


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  1. Introduction
  2. What is iDEAL?
  3. Where is iDEAL used?
  4. Who uses iDEAL?
    1. Businesses
    2. Customers
  5. How iDEAL works
  6. Business benefits of accepting iDEAL
    1. Expanded customer base
    2. Immediate transaction confirmation
    3. Reduced risk exposure
    4. Access to transaction data
    5. Compatibility with different platforms
    6. Streamlined operational processes
    7. Support for a cashless society
    8. Potential for customer loyalty
  7. iDEAL security measures
  8. Requirements for businesses to start accepting iDEAL payments
  9. iDEAL alternatives

iDEAL is a Netherlands-based payment method that streamlines the checkout process by connecting a customer's bank account with online businesses. Data from the Dutch Payments Association shows that iDEAL processed over 1.2 billion transactions in 2022, a figure which suggests that Dutch customers have a strong preference for direct bank transfers when engaging in e-commerce.

iDEAL is not as popular internationally, due to different payment preferences and practices across regions. In the Netherlands, the platform owes much of its success to its deep integration with the Dutch financial system and its ability to facilitate real-time transactions within its network of partner banks. Despite its limited international footprint, iDEAL's operational model demonstrates that regional payment solutions have the potential to dominate their local markets by adapting to customer behaviour and local banking frameworks.

iDEAL emphasises speed and direct bank interaction – which adheres to trends in the domestic market – while also reducing the exposure of businesses to chargebacks. The increase in online transactions shows just how relevant iDEAL is to the Dutch market, where many online retailers consider it to be on the same level as card payment options.

The ascent of iDEAL is an important case study for understanding how payment systems adapt to customer habits and expectations within specific markets. While this is particularly helpful for businesses that want to engage with the Dutch market, any business involved in global e-commerce can benefit from the insight that iDEAL provides surrounding market-specific payment solutions.

What's in this article?

  • What is iDEAL?
  • Where is iDEAL used?
  • Who uses iDEAL?
  • How iDEAL works
  • Business benefits of accepting iDEAL
  • iDEAL security measures
  • Requirements for businesses to start accepting iDEAL payments
  • iDEAL alternatives

What is iDEAL?

iDEAL is an online payment method which is widely used in the Netherlands and allows customers to conduct transactions via direct online transfers from their bank accounts. Launched in 2005, iDEAL has become a standard for electronic transactions within the country and boasts a loyal user base which values its security and speed. By acting as an intermediary between customers and businesses, iDEAL facilitates a real-time transfer of funds without requiring customers to enter their card details – providing bank-level security for the online purchasing process.

The system is notable for its integration with the majority of Dutch banks, which makes it accessible to a large number of Dutch customers. Data from the Dutch Payments Association shows that more than €107 billion in transaction value was processed via iDEAL in 2022. Dutch customers prefer iDEAL partly because of the high level of familiarity and trust that they place in their banking institutions. This is because iDEAL leverages existing online banking services for payment processing.

With iDEAL, businesses receive payment confirmation immediately, facilitating the swift fulfilment of goods and services – a major factor in e-commerce operations. The system works seamlessly across various platforms, including desktop and mobile, which reflects an understanding of the diverse ways in which customers interact with online businesses. As e-commerce continues to grow, iDEAL's prominence in the Netherlands exemplifies the market's preference for flexible, bank-based digital payment solutions.

Where is iDEAL used?

iDEAL's user base is concentrated in the Netherlands, with recent figures indicating that a substantial percentage of the Dutch population uses the service for online transactions. While the exact number of global users is not publicly available, the volume of transactions processed via iDEAL demonstrates its reach, with over 1 billion transactions having been conducted using iDEAL since 2021.

  • The Netherlands
    iDEAL is the preeminent online payment method in the Netherlands. The platform is integrated with all major Dutch banks and it enjoys high levels of adoption among customers and businesses. The Dutch Payments Association reports consistently increasing transaction volumes year on year, solidifying iDEAL's position as the backbone of the Dutch e-commerce payment system.

  • Belgium
    Belgium has also seen a growing number of businesses beginning to accept iDEAL, which underscores both the dense influx of Dutch shoppers into the country and the business opportunity that iDEAL presents. Cross-border shopping between the Netherlands and Belgium is common, and iDEAL serves as a bridge for customers who prefer to use their own banking services for online purchases.

  • Other European countries
    Although iDEAL is less prevalent across the rest of Europe, select businesses have acknowledged the value of offering iDEAL to cater for the Dutch diaspora and tourists. To expand their reach, these businesses often partner with payment service providers that accept iDEAL.

Major banks and financial institutions in these regions support iDEAL because it provides a direct link to customers' bank accounts. As digital commerce evolves, reliance on traditional card networks in these areas has experienced a shift – especially since iDEAL now provides an appealing alternative for customers.

Who uses iDEAL?

iDEAL's popularity among customers rests on its simplicity, reliability and high level of confidence within the payment ecosystem. iDEAL's payment model resonates with the contemporary needs of customers and businesses, and the platform is handling an increasing volume of transactions each year.


  • E-commerce and online retailers
    iDEAL is the backbone of Dutch e-commerce and is popular with all types of businesses, from emerging startups to established online marketplaces. A large portion of online purchases in the Netherlands are completed using iDEAL, emphasising the trust that customers and businesses place in the platform.

  • Service providers
    Businesses that operate in the utilities, telecommunications and digital services space often use iDEAL due to its ability to facilitate direct payments from bank accounts. This ensures timely and complete payments, circumventing issues such as credit card limits or direct debit mandates.

  • Travel and hospitality industry
    The travel sector – including hotels and airlines – uses iDEAL for its simplicity and immediate payment confirmation, which suits the time-sensitive nature of travel bookings and reservations.

  • Subscription-based businesses
    The platform also serves the subscription economy, from streaming services to software-as-a-service (SaaS) models. By providing customers with a direct bank transfer option, businesses can reduce the likelihood of failed payments due to expired or cancelled cards.

  • Charitable organisations and fundraising platforms
    Non-profits and fundraising campaigns use iDEAL to streamline the donation process and encourage a higher volume of contributions.


  • Tech-savvy customers
    Younger, tech-centric individuals often choose iDEAL for online shopping and services, taking advantage of the system's ease of use and high level of security, which credit cards may not always provide.

  • Families and household shoppers
    With its extensive presence in the retail sector, iDEAL is a popular choice for families making routine household purchases.

  • Small business owners
    iDEAL facilitates smooth payment transactions with customers, making it a strategic choice for small businesses.

  • Expatriates and international shoppers
    Dutch people living abroad or international customers making purchases on Dutch e-commerce websites often use iDEAL for cross-border transactions, making use of its simple and easy-to-use payment process.

  • Older population
    As of 2017, Dutch adults aged 65 to 74 used the internet at higher rates than found in other European countries, making iDEAL a convenient method for this demographic to complete online purchases and bill payments, thanks to its simplicity and the security associated with direct bank transfers.

How iDEAL works

iDEAL operates as a direct online transfer system from the customer's bank account to the business's bank account. When a customer selects iDEAL as their payment method during an online purchase, they are redirected to their bank's online banking environment. Here, the payment details are pre-filled and the customer only needs to authorise the transaction, which they can do using two-factor authentication as provided by their bank.

Following authorisation, the business receives confirmation and the customer is redirected back to the business's website. The authorisation triggers a real-time transfer of funds from the customer's bank to a collective settlement account managed by Currence, the business behind iDEAL. These funds are distributed to the business's bank account.

Here's a more in-depth look at how the iDEAL platform functions:

  • Data security in transactions
    iDEAL uses several layers of security to protect customer data during transactions. As the payment is processed through the customer's online banking system, it benefits from the bank's own security measures, which include encryption and secure login protocols. For an additional layer of security, all data remains within the banking network, and no sensitive financial information is shared with the business.

  • Fee structure for transactions
    Businesses pay a fee for each iDEAL transaction. These fees are determined by the business's bank and can vary based on transaction volume and the bank's own pricing strategies. Generally, they represent a fixed amount per transaction rather than a percentage of the transaction value. Customers do not pay any fees for using iDEAL.

  • Clearing and settlement mechanisms
    Clearing and settlement of iDEAL payments occur on the same day. As mentioned above, once the payment has been authorised, funds are transferred immediately to the collective settlement account. The settlement to the business's bank follows the protocols agreed upon between the participating banks and Currence. These processes are monitored continuously for operational efficiency and are considered to be highly reliable.

  • Transaction data and analytics
    iDEAL provides businesses with access to transaction data through iDEAL's integrated banks, which businesses can use to track payment statuses and reconcile accounts. Often, banks also have additional services which enable businesses to analyse transaction patterns and can inform business decisions.

  • Interoperability and technology integration
    The iDEAL platform is designed to integrate easily into a business's online payment systems, typically through application programming interfaces (APIs) provided by the banks that integrate with iDEAL. This ensures compatibility with a wide range of e-commerce systems and creates a streamlined checkout process for customers.

iDEAL's design reflects a keen understanding of the Dutch financial environment, where customers show a strong preference for direct bank transfers over credit card payments. iDEAL's popularity and widespread adoption demonstrates the system's ability to meet the needs of a society that prioritises efficiency and security in online financial transactions. The continuous growth in the volume of iDEAL transactions – with iDEAL's transaction volume increasing from 524 million transactions in 2018 to over 1.2 billion in 2022 – illustrates its solid position within the Dutch payment processing network.

Business benefits of accepting iDEAL

Expanded customer base

Businesses that integrate iDEAL can tap into the extensive user base of one of the Netherlands' most popular payment methods. A 2022 report from the Dutch Payments Association shows that iDEAL accounts for about 70% of online payments within the Netherlands.

Immediate transaction confirmation

With iDEAL, transactions are confirmed instantly. This real-time processing facilitates a faster turnaround in goods and services delivery. Immediate transaction confirmation is particularly beneficial for businesses that sell digital goods and services because it enables instant access post-purchase.

Reduced risk exposure

The direct bank-to-bank transfer mechanism of iDEAL minimises the risk of chargebacks for businesses. As the bank authenticates and authorises the payment, the incidence of fraudulent transactions is substantially lower than with some other payment methods.

Access to transaction data

Businesses receive detailed transaction data from iDEAL, which is pivotal for financial reconciliation and can provide insights into customer spending behaviours. These metrics can help businesses with adjusting inventory levels, tailoring marketing efforts and optimising the checkout process.

Compatibility with different platforms

iDEAL's compatibility with several e-commerce systems ensures that businesses can provide customers with a familiar payment method across different online platforms. This interoperability also helps businesses to cater to a diverse online customer base, without needing to adapt their systems in major ways.

Streamlined operational processes

By using APIs, businesses can integrate iDEAL into their existing financial and operational systems. This supports streamlined accounting processes, accurate inventory management and simplified financial reporting.

Support for a cashless society

The Netherlands is on the path to becoming a cashless society, and iDEAL's platform provides businesses with a digital payment solution that can help them adapt to this shift in customer behaviour.

Potential for customer loyalty

Although iDEAL does not offer loyalty programmes directly, businesses can use iDEAL's transaction data to develop targeted rewards programmes. This can deepen customer relationships and encourage repeat business.

iDEAL security measures

iDEAL enforces robust security protocols to ensure the safety of online transactions. The platform's widespread adoption reflects this commitment to security: according to a 2022 report, iDEAL boasts millions of transactions per month.

  • Authentication process
    Every iDEAL payment requires the customer to authenticate their identity directly with their bank. This process takes place on the bank's own platform, leveraging the bank's existing security measures, such as two-factor authentication, which may include one-off passwords or biometric verifications.

  • Transaction integrity
    Transactions made with iDEAL happen in real time and are irrevocable. This facilitates immediate payment confirmation and also eliminates a window of opportunity for fraud that can exist with delayed or reversible transactions.

  • Data encryption standards
    iDEAL employs stringent data encryption standards, similar to those mandated by international security standards, to safeguard transaction details and personal information.

  • Compliance with European regulations
    Since it operates within the Netherlands, iDEAL is subject to the European Union's strong regulatory framework, including the General Data Protection Regulation (GDPR) and the revised Payment Services Directive (PSD2) – both of which set high bars for data protection and payment security.

  • Monitoring and risk management
    iDEAL's systems monitor transactions continuously, flagging unusual patterns that could indicate a security threat.

  • Regular security audits
    To maintain its defences against emerging threats, iDEAL undergoes regular security audits by third-party security experts.

  • Bank-level security
    Since iDEAL transactions are bank-to-bank, the payment method benefits from the high levels of security inherent in the banking industry. Banks in the Netherlands are known for their cutting-edge cybersecurity measures and stringent risk-assessment protocols.

Requirements for businesses to start accepting iDEAL payments

Businesses must meet several prerequisites in order to integrate iDEAL as a payment method, which reflects the high regulatory and operational standards of the Dutch payment system.

  • Merchant account registration
    To integrate iDEAL, businesses must first register for a merchant account with a bank that supports iDEAL payments. This process involves providing the bank with detailed information about the business, including registration documents, financial statements and proof of compliance with local business regulations.

  • Technical integration
    Once the business has established a merchant account, it can integrate iDEAL using the provided API or software development kit (SDK). This technical integration requires a secure website and an understanding of how to implement API calls within the existing infrastructure.

  • Compliance with regulatory standards
    To use iDEAL, businesses must comply with the Payment Card Industry Data Security Standard (PCI DSS) to handle customer payment information securely. In addition to PCI DSS, businesses must also adhere to the European Union's GDPR, which ensures that businesses process and store customer data in line with European privacy laws.

  • Payment service provider partnership
    Smaller businesses may choose to integrate with iDEAL by using a payment service provider (PSP) that includes iDEAL payment solutions. Partnering with a PSP can simplify the process because the PSP handles technical integration and compliance. The business's responsibilities will be outlined in the service agreement with the PSP.

  • Testing and validation
    Before going live, businesses must conduct thorough testing of the iDEAL payment process. This testing phase includes verification of successful transactions, correct error handling and the secure transmission of payment data.

  • Customer information protocols
    Businesses must communicate clearly with customers about the use of iDEAL. This involves updating the website's payment information, privacy policy and terms and conditions to reflect iDEAL as a payment option.

  • Bank agreements
    A business's bank may have specific requirements for transaction volumes, security measures or the operational procedures required to maintain the integrity of the iDEAL payment method. The bank will outline these in a contractual agreement with the business.

iDEAL alternatives

Each payment method outlined below offers businesses different capabilities for accepting payments while catering to different operational needs and customer preferences. While iDEAL retains a strong foothold in the Dutch e-commerce sector – where it accounts for more than half of online transactions – these alternatives cater to a range of locations and industries. Typically, the payment methods that a business accepts reflect its specific operational requirements, the nature of its customer base and its geographic location.

  • PayPal
    PayPal is a globally recognised platform which enables customers to make online purchases without revealing their financial details to sellers. This method offers buyer protection, and users appreciate its intuitive interface and the convenience of its mobile app. As of 2023, PayPal boasted over 400 million active accounts.

    SOFORT is a real-time payment service that operates in some European countries. Similar to iDEAL, it allows customers to conduct transactions using their own online banking information. Owned by Klarna, SOFORT is most popular in Germany and the Netherlands.

  • Bancontact
    Bancontact, the market leader in electronic payments in Belgium, provides a secure payment method through an app which generates a unique QR code for each transaction. The company has reported an increase of nearly 55% in payments in five years, between 2018 and 2023.

  • Giropay
    Giropay is a German payment alternative that allows customers to make secure online purchases by transferring funds directly from their bank accounts. According to a Statista report from 2023, 18% of digital payment users in Germany use Giropay.

  • Credit cards
    Credit cards, including Visa and Mastercard, are ubiquitous. This payment method is popular thanks to its rewards programmes, advanced security features and ease of use. A 2022 McKinsey & Company report shows that credit card use worldwide is continuing to increase, indicating a sustained reliance on this payment form by both customers and businesses.

  • SEPA credit transfer
    SEPA transfers are a popular method for facilitating euro-denominated payments across the 36 SEPA countries and territories. This method gives businesses that conduct regular, non-urgent transactions special advantages, due to its lower fees and standardised processing.

The content in this article is for general information and education purposes only and should not be construed as legal or tax advice. Stripe does not warrant or guarantee the accurateness, completeness, adequacy, or currency of the information in the article. You should seek the advice of a competent attorney or accountant licensed to practice in your jurisdiction for advice on your particular situation.

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