In Portugal, ecommerce revenue is expected to reach $5.38 billion in 2025, highlighting the growth potential for businesses looking to start accepting payments in this market. But your business’s success will depend on your ability to tap into the trend toward contactless payments, simplify international transactions from inside and outside the EU, and other key factors.

Below, we’ll detail strategies for entering the Portuguese payments environment, including by:

• Balancing digital and cash payments
  
• Enhancing the customer payment experience
  
• Facilitating international transactions
  

The state of the market

Portugal’s payment culture has gradually shifted over the years, with traditional payment methods such as cash coexisting with digital alternatives. Digital wallets and online banking apps have seen increased adoption, especially among younger people, and the interbank network Multibanco has made online payments more accessible for people who prefer to pay in cash.

The Banco de Portugal, Portugal’s central bank, leads the country’s monetary and financial activities. The Banco de Portugal implements monetary policy, supervises financial institutions, and ensures payment systems function properly. The Portuguese Securities Market Commission (CMVM) regulates securities and other financial institutions. These organizations along with the Ministry of Finance work to maintain the stability and transparency of the country’s financial system. As a member of the EU, Portugal also adheres to regional regulations including the General Data Protection Regulation (GDPR).

Payment methods

Portuguese customers frequently use cash and electronic payment methods. Here’s a look at the most common payment methods in Portugal:

Usage

Though the number of cash transactions fell by 17% between 2019 and 2022, 64% of point-of-sale (POS) transactions were still conducted with cash in 2022, according to the European Central Bank. Card payments have grown in popularity, with more than 56% of Portuguese customers saying their preferred POS payment method is a card or other cashless option.

Portugal has had a sharp rise in contactless payments as well: 49% of credit card transactions were contactless in 2022. Homegrown mobile payment methods such as the digital wallet MB WAY have seen widespread use thanks to the convenience of connecting users’ bank accounts or cards to their phone.

Multibanco lets users shop online and pay with cash at a participating ATM. According to data from SIBS, the entity behind Multibanco, there were more than 190 million electronic transactions in June 2025, up from 170 million the previous June, reflecting an increasing comfort with digital transactions.

Popular B2C payment methods in Portugal

• Credit and debit cards
  
• Bank transfers
  
• Multibanco
  
• Digital wallets (e.g., MB WAY)
  

Popular B2B payment methods in Portugal

• Credit cards
  
• Bank transfers
  
• Direct debits (e.g., Single Euro Payments Area [SEPA])
  

Trends

Multiple buy now, pay later (BNPL) providers have launched in Portugal, including Klarna and FLOA Pay, introducing Portuguese customers to installment payment plans beyond credit cards. Portuguese customers typically use BNPL payments for larger purchases such as household appliances and electronics.

Ease and friction of entry

Businesses considering accepting payments in Portugal should look at multiple factors, including value-added tax (VAT) and chargeback processes. Here’s an overview:

Taxes

Portugal has a standard VAT rate of 23% for most goods and services, with reduced rates of 13% and 6% for certain items, such as food. The autonomous regions of Madeira and the Azores have slightly different VAT rates. Though customers pay this tax when they make purchases, businesses are responsible for collecting and remitting it to the state, and incorrect VAT handling can lead to penalties.

Chargebacks and disputes

Portugal’s Direção-Geral do Consumidor (the General Directorate of Consumer Affairs) oversees transaction protections and dispute resolution. The onus is often on businesses to provide evidence of a transaction’s legitimacy, especially when a customer says a transaction wasn’t authorized. As a member of the EU, Portugal complies with the revised Payment Services Directive (PSD2), a cornerstone of which is Strong Customer Authentication (SCA). This heightened verification standard influences chargebacks and disputes, with transactions that adhere to SCA often facing fewer disputes because of the enhanced security measures.

SEPA regulations also inform the country’s regulatory landscape. For chargebacks related to direct debits under SEPA, customers have the right to request a refund within eight weeks of the transaction.

International payments

International payments often require currency conversion, with fluctuating exchange rates adding another layer of complexity. Here are a few aspects of cross-border payments in Portugal to note:

• Currency conversion: For international transactions originating outside the eurozone, currency conversion is often necessary on the customer or business side. When a transaction is processed, a conversion fee between 1% and 3% is typically applied and is passed on to the customer or absorbed by the business.

• Multicurrency features: For businesses planning to engage clients in countries that don’t use the euro, it can be advantageous to list prices in multiple currencies or use a payment gateway that detects a customer’s location and shows the corresponding currency.

• SEPA transfers: Portugal belongs to the SEPA zone, allowing for fast and inexpensive transfers between the 36 member countries. SEPA Credit Transfers are one-time transfers commonly used for customer and business purchases within the SEPA zone.

Security and privacy

Portugal operates in accordance with EU regulations for a secure and transparent financial environment. Here’s what to know about how the country handles security and privacy matters:

• Data protection laws: Portugal abides by the GDPR, which mandates stringent data protection practices and acquiring users’ consent before collecting personal information. The Comissão Nacional de Proteção de Dados (CNPD), Portugal’s national data protection authority, monitors GDPR compliance.

• Customer authentication regulations: Portugal also follows the EU’s PSD2. SCA, a security measure for online payments and account access that requires multiple methods of verification, is a central tenet of PSD2. This verification can be a password, biometric data such as a fingerprint, or demonstrating access to a phone or another card registered in the payer’s name.

• Anti-Money Laundering (AML) guidelines: In line with EU directives, Portugal enforces AML and Counter-Terrorism Financing (CTF) regulations that demand financial institutions establish monitoring systems for potentially dubious activities, with hefty penalties for noncompliance. The Unidade de Informação Financeira (UIF), a specialized police unit, enforces AML efforts in Portugal.

Key success factors

The Portuguese market shares many similarities with those of its European counterparts but maintains nuances that should be factored into your business strategy. Here’s how to set your business up for success in Portugal:

• Multiple payment methods: Despite the global push toward cashless transactions, Portugal’s transition has been relatively gradual, prompting businesses to accommodate a mix of payment preferences. Offering customers a range of options—including credit and debit cards, digital wallets, and BNPL—makes the checkout process feel familiar and can reduce cart abandonment.

• Localized customer engagement: Adapt your website and payment pages for Portuguese customers by translating any copy into Portuguese and displaying prices in euros. Customer support channels, such as live chats, should also be made available in Portuguese to show local customers their business is valued.

• Simplified cross-border transactions: SEPA facilitates smoother payment transactions within the eurozone, and the low transfer fees can save businesses money. When it comes to payments from non-EU countries, being transparent about currency conversion rates and fees goes a long way toward gaining customers’ trust.

• Compliance with European regulations: As a member of the EU, Portugal adheres to the evolving regulatory requirements of the bloc, such as the GDPR. Noncompliance with the GDPR can result in penalties up to €20 million or 4% of a business’s global annual turnover. Investing the time and resources to make sure your business complies with the GDPR and other EU directives can help avoid major headaches.

Key takeaways

Businesses expanding into Portugal can improve the customer payment experience by embracing contactless payments, localizing the payment process, and simplifying international transactions. Here are key considerations and strategies to help your business thrive in the Portuguese payments system:

Lean into contactless payments

• Prepare for contactless cards: Contactless payments have seen steady growth in Portugal. Make sure your business has the software and hardware to accept contactless card payments in person and online to meet customers’ expectations.

• Acknowledge the role of mobile payments: Mobile payments have been steadily increasing in Portugal, and adapting your payment systems to accommodate digital wallets can cater to a tech-savvy customer base.

• Tap in to Multibanco’s network: Multibanco is a dominant force in the Portuguese payments market. Integrating it as a payment option can resonate with Portuguese customers and make the payment process more approachable.

Enhance the customer payment experience

• Localize customer interfaces: Translating your business’s online presence to Portuguese and factoring in regional nuances can elevate the user experience and increase conversion rates.

• Incorporate feedback loops: Engaging with Portuguese customers to gather feedback after they’ve made a purchase can provide insight into potential areas for improvement and local trends to follow.

• Prioritize protecting customer data: Strong encryption methods, two-factor authentication, and Payment Card Industry Data Security Standard (PCI DSS) compliance can help build trust in your business as well as ensure compliance with EU regulations.

Facilitate international transactions

• Be transparent about currency conversions: Given Portugal’s EU membership, many transactions occur in euros. For businesses that serve tourists or international customers outside the eurozone, however, transparently communicating about conversion rates and fees can instill trust and reduce cart abandonment.

• Use SEPA transfers: Implement cross-border SEPA transfers to keep fees low and reduce transaction times.

• Stay up-to-date on EU regulations: Because EU financial regulations are always evolving, it’s important for businesses to stay updated on any rule changes, particularly regarding international transactions.