A consortium of all the major Dutch banks developed the iDEAL payment method in 2005 to make it easier for their customers to pay online for products and services. iDEAL allows payments to be made using online banking through the customer’s own bank.
Upon purchase, the funds are instantly debited from the customer’s account. As a part of the payment process, the customer is requested to authorize the payment via the bank’s supported email, text or security token authentication method. The payment cannot be cancelled once complete and it is guaranteed to the merchant with low risk of returns.
12.5 million customers use iDEAL for their day-to-day payments. With low fees for payment processing, real-time notification of payment authorization, and possibility of immediate shipping of goods, it comes as no surprise that 59% of all online transactions in the Netherlands are done using iDEAL. iDEAL is based on online banking and uses the same security techniques. This means no risk of fraud.