SA can PayFast online

By Siyabonga Africa, ITWeb junior journalist

Johannesburg, 13 Oct 2008

Bidorbuy founder Andy Higgins is introducing an online payment service similar to the US-based PayPal service.

The banking solution is said to offer South Africans a safe credit card-like experience using electronic funds transfer (EFT).

“Using PayFast's EFT solution is safer than using a credit card as there is no risk of charge-backs. PayFast's instant EFT still gives the benefit of immediate fulfilment of purchases for the buyer and, like credit cards, there is no manual bank reconciliation required for the online merchant,” says PayFast MD Jonathan Smit.

Smit adds smaller merchants have also requested a credit card service to complement the EFT solution, and PayFast is developing it, with the aim of launching during the course of the fourth quarter.

A PayFast statement says the service was taken out of beta testing at the beginning of last month.

E-retail on the rise

World Wide Worx director Arthur Goldstuck says there has been a dramatic increase in the rate of growth of online retail since 2006. He explains that, in 2001, there were only 2.8 million South Africans who had Internet access, while only 354 000 had been online for more than five years. This meant a lot of investment was going after a small market.

“By 2006, those 2.8 million people had been online for five years or more, and were part of a rapid rise in the number of people moving up the experience curve, which is the relationship between the growth in online retail and the number of Internet users who have been online for more than five years.”

Goldstuck expects to see that increasing rate of online buyers maintained through to 2010, when it will slow down for a few years as the experience curve flattens again. He explains this relates directly to Internet newcomers and their ability to trust e-commerce.