Understanding iDEAL: The go-to payment method in the Netherlands

When expanding your business into the Netherlands, there's one payment method you can't ignore. iDEAL dominates the Dutch market, processing over 1.3 billion transactions annually, accounting for a staggering 73% of all Dutch online purchases. 

This direct bank transfer system has become the default choice for Dutch consumers purchasing everything from electronics to utility bills, creating a distinct payment ecosystem that operates differently from much of the global market.

In this guide, we'll explore how iDEAL works, why it's the trusted choice for millions of shoppers in the Netherlands, and how your business can leverage it as part of your European expansion strategy.

What is iDEAL and why is it so popular in the Netherlands?

iDEAL is a bank-to-bank payment system created in 2005 by major Dutch banks. It connects online retailers directly to customers' bank accounts, eliminating the need for card payments.

The system's popularity stems from its simplicity and integration with Dutch banks. When shoppers select iDEAL at checkout, they don’t need their card details or to create a new account, and they receive immediate payment confirmation.

Dutch payment culture also helps – in a country where the word for debt also means ‘guilt’, direct bank transfers are favoured over credit.

For businesses expanding into Dutch markets as part of their global strategy, offering iDEAL is essential for checkout conversion.

How does iDEAL work? A step-by-step guide

The iDEAL payment process is straightforward for both shoppers and merchants. Here's what happens when a Dutch customer makes a purchase:

1. Checkout initiation: The customer adds products to their cart and proceeds to checkout.

2. Payment method selection: At the payment screen, the customer selects iDEAL.

3. Bank selection: They choose their bank (ABN AMRO, ING, Rabobank or another) from the list of participating banks.

4. Secure redirection: The customer is redirected to their bank's online banking environment.

5. Authentication: The customer logs in using their regular banking credentials and authentication methods (typically two-factor).

6. Payment confirmation: With the merchant name and purchase amount pre-filled, the customer just has to review and confirm payment.

7. Real-time processing: The bank instantly processes the payment using the IBAN (International Bank Account Number) system, confirming funds are being transferred directly from the customer's account to the merchant's bank account.

8. Return to merchant: The customer is automatically redirected back to the merchant's website with their successful purchase confirmation.

The entire process typically takes less than a minute, with final settlement to the merchant's bank account usually within minutes, but it can take up to one business day.

Key reasons iDEAL is the preferred payment method in the Netherlands

Trust and security

iDEAL uses the same robust security techniques and standards as internet and mobile banking. 

This means an iDEAL payment is protected by the bank's existing security infrastructure – the same systems that safeguard customers' everyday banking. The familiarity builds confidence for consumers while eliminating exposure of financial details to third parties. Unlike credit card payments, iDEAL transactions cannot be charged back once completed, protecting businesses from reversal risks and encouraging direct resolution of disputes.

User experience

iDEAL integrates directly with the banking apps Dutch consumers already use daily. When paying, shoppers simply scan a QR code or follow a redirect to their banking app, approve with their usual authentication method, and return to the merchant site. The entire process takes seconds and requires no card details or new accounts.

Since every major Dutch bank, including ABN AMRO, ING, Rabobank, and others, supports iDEAL, the system works for virtually everyone with a Dutch bank account. This translates to higher checkout completion rates for businesses, as customers are more likely to complete purchases when their preferred payment method is available.

Low fees

For both businesses and consumers, iDEAL offers predictable, transparent costs. Merchants pay a fixed fee per transaction determined by their bank, rather than a percentage-based model that can become expensive with higher-value purchases. For consumers, iDEAL payments are completely free with no hidden charges, removing cost barriers that might otherwise impact purchase decisions.

If you want to see how different Dutch payment providers compare, check out our guide to the best payment solutions for Dutch businesses.

Are there any downsides to using iDEAL?

While iDEAL payments dominate the Dutch landscape, international businesses may want to consider these potential limitations when expanding into this market.

Geographic limitations

iDEAL is designed to be used within the Netherlands. While perfect for businesses targeting Dutch consumers, its limited international footprint means companies operating across multiple markets need separate payment solutions for other countries.

Integration complexity

Businesses looking to accept iDEAL payments must either integrate directly through APIs provided by Dutch banks or use a payment service provider (PSP). Direct integration requires technical resources and expertise, while using a PSP adds an additional layer with associated costs and dependencies. 

iDEAL is one of several payment methods supported by Airwallex, enabling customers to offer iDEAL at checkout.

No built-in refund system

While the absence of a native mechanism for automatic refunds or chargebacks protects merchants from disputed charges, you may need to establish a separate refund process. However, this is often supported by payment providers who offer iDEAL.

Dutch business account requirement

Merchants must have a relationship with an iDEAL certified acquirer to receive iDEAL payments. For international businesses, this means establishing a local banking relationship in the Netherlands, which can involve paperwork, hefty compliance requirements, and account management. Alternatively, cross-border payments providers like Airwallex offer access to iDEAL.

iDEAL and 159 more local payment methods, supported by Airwallex

Expanding across borders means adapting to local payment preferences, and in the Netherlands, that means offering iDEAL. But managing different payment systems, compliance rules, and banking requirements for each country can create friction that slows your business down.

With Airwallex, you can accept iDEAL payments in EUR without opening a Dutch business bank account. iDEAL is supported natively on the Airwallex platform through local payment rails, so you can offer Dutch customers their preferred way to pay, without the complexity of integrating with Dutch banks or third-party PSPs.

What’s more, you can hold, convert, or transfer funds in 23+ currencies when it’s most cost-effective, helping you reduce losses from exchange rate fluctuations and forced conversions. And with access to 160+ local payment methods, Airwallex helps you offer the right checkout experience for every market – not just the Netherlands.