Benchmarking the EU’s Digital Engagement: the Netherlands

In this second of the series on the EU’s digital transformation, PYMNTS will be delving into how people in the Netherlands engage with digital technologies.

To assess a country’s digital transformation, the “Benchmarking The World’s Digital Transformation” report, published in collaboration with Stripe, uses the ConnectedEconomy™ Index (CE Index) developed by PYMNTS to gauge the extent of digital transformation experienced by a surveyed population.

Read the report: Benchmarking World’s Digital Transformation

Read also: Benchmarking the EU’s Digital Engagement: Spain

With a CE Index score of 27.6, the Netherlands emerged as the second-most digitally engaged of the five E.U. countries surveyed (EU-5) — Germany, Spain, France, Italy and the Netherlands.

The report also found the Netherlands to have the second-highest internet connectivity rate of 91.3%, indicating that the country is significantly better connected than the 15-country average of 86.6%. The European country has the third-highest share of respondents who reported owning a smartphone at 77%.

Besides the 9.7% of survey respondents with no regular internet access, 17.1% were found to have a high level of digital engagement, 30.7% reported a medium level, and  43.5% reported a low level.

When the Netherlands’ CE Index score is broken down by generation, it reveals that Gen Z respondents (18 to 25 years) in the country have an average score of 41, Millennials (26 to 41 years) an average of 40, Bridge Millennials (34 to 43 years) an average of 37.

Looking at the two oldest generations, the report found that engagement dropped off significantly. Gen Xs (42 to 57 years) scored an average of 32 and the oldest group, consisting of Baby Boomers and Seniors (58+) scored just 14, the second-lowest of the EU five.

Reflecting the regional diversity of payment preferences found in continental Europe, the report found that the preferred payment methods of Netherlanders were unique among the EU-5.

The Netherlands in general has a high preference for digital payment methods — it has the lowest cash usage in the eurozone, and behind the Nordic countries when the whole of Europe is taken into consideration.

The data further reveals that of all online payments recorded, 41.1% were bank transfers, 36.1% were card-based, 19.2% were mobile payments, and 2.9% used buy now, pay later (BNPL).

Learn more: Dutch Payments Association GM Says ‘Positive Friction’ Will Protect BNPL Users

See also: Dutch FinTech Mollie Launches SaaS Payment Platform

The preference for bank transfers in the Netherlands is significantly higher than in any other country under study. This reflects the widespread success of the country’s national payment system, iDeal, and the subsequent lower usage of card payments compared to most other countries.

Further reading: Mollie Looks to Improve Marketplace Product With a Financial Services Suite for European SMBs

However, the preference for bank transfer payment methods does not translate to the way people shop in-store in the Netherlands.

In this respect, the country conforms more to the global picture of a preference for card payments, which accounted for 57.9% of all transactions recorded. Of the rest, cash made up 18.1%, mobile payments 11.3%, bank transfers 10.9% and BNPL options 0.8%.

Sign up here for daily updates on all of PYMNTS’ Europe, Middle East, and Africa (EMEA) coverage