Payment gateways such as PayPal, Mygate, PayGate, PayFast, and VCS allow your customers to make purchases on your site. PayPal is internationally recognized as the industry leader in payment, with over 230 million users worldwide.
This would make PayPal a natural first choice as a payment gateway for your site, but as the Rand is not a PayPal supported currency you could only use it to pay others or transfer money into other PayPal accounts. Receiving funds into your account used to be a big problem that held South African online entrepreneurs back from taking full advantage of what PayPal has to offer.
In this blogpost we explore the pros and cons of PayPal in South Africa and look at the implications for the WordPress developer.
FNB to the rescue
In 2010 a partnership between First National Bank (FNB) and PayPal finally made it possible for South Africans to send and receive funds through this popular payment Gateway. The service allows customers to top up and withdraw funds to their qualifying FNB accounts from their PayPal accounts
This video posted by MMClients on You Tube explains how to transfer money from PayPal to an FNB account.
In a recent move (November 2011), FNB has opened up access to their PayPal service, allowing people with accounts at any other South African bank to link their accounts to their PayPal account and receive funds from anyone belonging to the PayPal network across the world.
Limitations of FNB’s service
With FNB opening up its service to clients of other SA banks, it seems as though all South Africans can finally take full advantage of the PayPal service. This is a great step forward, but in dealing with the other South African banks we’ve found that they aren’t aware that this service has been opened to them.
FNB representatives at the recent Tech4Africa conference proved lacking in knowledge of their PayPal services on offer and we’ve had mixed feedback from our clients on their customer service experience with FNB and PayPal.
The sign up process for PayPal services with FNB is complicated and easily aborted due to the difficulty. This has led to the many of our clients opting for South African payment Gateways.
Keep a look out for our Step-by-Step Tutorial on linking external accounts with FNB. We will be publishing it soon.
- Pay for products and send money without having to enter your personal information every time.
- PayPal is immediately recognizable to most online shoppers in any country and it is widely respected and trusted.
- The easiest gateway to setup, with the least admin.
- Once you are verified you can display the verified PayPal badge on your site to add to your trust and legitimacy from the consumer perspective.
- PayPal gives you access to a global network of over 190 countries and regions
- PayPal is one of the payment gateways with the least fees (about R2.06 + 4.9% of sale). *As Andy has pointed out in the comments below PayFast seems to be the cheapest and most convenient for the South African market.
- It is unable to use Rands (ZAR) as the primary currency. This means that when your customers checkout and end up on the PayPal payment page they will see the price in $’s even if the price is in Rands on your site.
- You have to link your bank account to PayPal via FNB
- The PayPal checkout process is not streamlined for non PayPal users. It nudges the user toward creating a PayPal account and doesn’t offer the credit card payment option at first.
PayPal and WordPress eCommerce solutions
Working on various eCommerce solutions for our clients, we’ve found that PayPal remains the most requested gateway to use.
PayPal and WP eCommerce
WP eCommerce boasts having the best Payment gateway API. WPEC overcomes the issue of ZAR not being a PayPal supported currency by converting the currency to USD upon Checkout. It does this within the Gateway itself using an external API so that you could still process payments.
PayPal and WooCommerce
WooCommerce offers two PayPal Extensions:
PROS for a WordPress Developer
- You are able to test your shop fully using a PayPal sandbox account, which is an exact copy of the actual PayPal.
- The PayPal system is widely supported by just about every single system, theme and plugin out there.
- PayPal is well documented and the developer community is fairly mature.
CONS for a WordPress Developer
- Since the Rand (ZAR) is not a supported currency, it can be difficult to get the amount changed to display Rands.
- PayPal has a high learning curve and is not user friendly.
Despite the issues faced when using PayPal as a South African consumer, online entrepreneur or WordPress developer it remains the most popular gateway for online businesses.