Over the years I’ve built a number of online businesses that have needed to be able to accept payments online in South Africa.
I’ve spent countless hours reaching and testing different ways to accept payments online and due to South African Reserve Bank regulations, it can sometimes be a lot harder than it should be to accept payments online in South Africa.
In this article, I am going to share with you all I have learned about the various payment platforms or gateways in South Africa and which one is the best and cheapest to use in your business.
I’m also going to share some of my experiences, both good and bad, as well as a pricing comparison between all of the payment gateways available in South Africa.
This is the list of payment gateways that are available in South Africa:
- Payfast
- Peach Payments
- PayU
- PayGate
- Ozow
- Payflex
- Yoco
- Netcash
- Snapscan
- PayPal
- 2Checkout
- Stripe
- Wirecard – Mygate
(Click on any of the links above to learn more about them, who they integrate with and their pricing structure.)
Let’s now dig into each payment gateway in a bit more detail…
PayFast
PayFast is one of the easiest payment gateways to use in South Africa today. PayFast, which is also owned by DPO, also don’t charge for a monthly fee for using their payment gateway and only charge a transaction fee when you do make a sale. This makes it an extremely attractive payment gateway to use for small businesses in South Africa.
Payfast also offer you a number of payment methods for your customers which include credit, debit and cheque cards, instant EFT, Mobicred, Masterpass, SnapScan, Zapper and Scode which allows customers to pay cash for their purchases.
You also don’t need a merchant account to use PayFast and they are also able to process recurring subscriptions.
PayFast is not the cheapest payment gateway in South Africa but they only make money if you do. They don’t charge a set up fee and there are no ongoing monthly fees.
For all of their payment methods PayFast charge 3.5% plus R2 per transaction, expect their instant EFT which is 2% and which is 4.5% plus R5 per transaction.
Payfast is also very easy to integrate with the most popular eCommerce platforms and they also allow you to create Pay Now buttons so that you can accept payments without having an eCommerce solution on your website. You can even use them in email!
With PayFast you do not need a merchant account.
The shopping carts that integrate with Payfast:
- Shopify – Yes
- Woocommerce – Yes
- WordPress – Yes
- Magento – Yes
- Ecwid – Yes
- Prestashop – Yes
- Cs.cart – Yes
- Opencart – Yes
- nopCommerce – Yes
- Zencart – Yes
- Gravity Forms – Yes
PayFast integrates with over 80 different shopping carts, you can see the full list here: https://www.payfast.co.za/integration/shopping-carts
Peach Payments
Peach Payments, which have offices in both Cape Town and Johannesburg, allow any business that sells goods or services digitally to accept payments online. They ingrate with some of the biggest eCommerce platforms globally and also have a modern API that allows for custom integrations.
According to Peach Payments you are able to accept payments from users all over the world. I have personally used Peach Payments as a merchant so that we could do this but they weren’t able to deliver on this promise.
Peach Payments also offers enterprise grade security with support for multiple channels and interfaces.
With Peach Payments you are able to accept all major credit cards including Visa, Mastercard, American Express and Diners Club. They also allow you to accept payments vis PayPal, instant EFT, Masterpass and Mobicred.
Two other features that Peach Payment offer is recurring payments which is great if you have a business that sells ongoing subscriptions to products or services as well as a one click checkout which saves your customers payment details securely to allow for seamless checkouts in the future.
In order to use Peach Payments you do need a merchant account.
Shopping Cart Integration:
PayU
PayU operates in over 50 countries, including South Africa and is a very strong player in the FinTech space. They are part of Prosus (Which is listed on the JSE) and have a strong presence in emerging markets.
They work with some of the biggest online retail in South Africa and have an extremely robust system for enterprise customers who require a large amount of transactions at the same time using transaction queues.
PayU offer various payment solutions, including One Click payments which allows you to accept credit card payments by integrating with your shopping cart. You are then able to accept Visa, Mastercard, Diners Club and American Express online.
PayU does offer recurring payments but they do not handle debit orders and you are also able to make use of their instant EFT option.
Merchant Account Required: Yes
Shopping Cart Integration:
- Shopify – No
- Woocommerce – Yes
- Magento – Yes
- Opencart – Yes
- Virtuemart – Yes
- Prestashop – Yes
Ozow
Ozow is one of the newer ‘kids’ on the South African payment gateway block and it’s starting to make waves. It is offered by some of the biggest and most trusted brands in South Africa, including Takealot, Mr Price, Vodacom and DisChem to name just a few.
Ozow offers card free, instant EFT payments that are seamless and incredibly fast. There is no registration needed from your customer which means less friction in the checkout process, which in turn leads to higher conversion rates.
As a merchant, you are able to have multiple bank accounts which share one Ozow merchant account on the Ozow dashboard. Ozow are able to link the bank accounts accordingly.
Another big advantage of using Ozow is that all payments are done in real-time and the payments are irrevocable. This limits the opportunity for fraud as once a payment has been confirmed, it cannot be reversed so therefore no charge backs.
Even though Ozow payment confirmations are in real-time, normal banking rules apply which means that the physical money may only reflect in your account in 24 – 48 hours (depending on the originating bank and the target bank).
Another fantastic advantage of using Ozow as a small business owner is that Ozow doesn’t charge any processing fees if you turn over less than R1 million a year, for the first 12 months of signing up to use Ozow. For businesses turning over more than R1 million the fees are very reasonable.
As a merchant, you can have multiple bank accounts sharing one Ozow merchant account on the Ozow dashboard. Ozow will link the bank accounts accordingly. All payments are done in real-time. The payment confirmation is in real-time; however, the normal banking rules apply where the physical monies may reflect in 24 – 48 hours depending on the originating bank and the target bank.
Shopping Cart Integration:
- Shopify – Yes
- Woocommerce – Yes
- BigCommerce – Yes
- Cs.cart – Yes
- WP eCommerce – Yes
- Magento – Yes
- Opencart – Yes
- Virtuemart – Yes
- Prestashop – Yes
- nopCommerce – Yes
- j2Store – Yes
- Drupal – Yes
Do you need a merchant account to use Ozow: No
PayGate
PayGate is another payment gateway in South Africa that is a well established and has been around for many years. PayGate, which is owned by DPO, is a fully managed payment gateway solution that is super simple to integrate with your favourite shopping cart or eCommerce platform.
Signing up with PayGate allows you, with one integration, to access a number of payment methods and is trusted by brands such as Superbalist.com, Yuppiechef, Uber and Booking.com.
PayGate allows you to accept credit card payments from around the world, instant EFT’s using the SiD Secure EFT service as well as payments through Mobicred and PayPal. You also get access to Masterpass, Zapper, Snapscan and MTN’s MoMoPay. So if you’re looking to offer your customers a multitude of ways to pay then PayGate is fantastic.
PayGate’s pricing structure is one of the easiest to understand and you don’t need a merchant account to use PayGate Plus. They charge R99 per month (ex VAT) and then a 3.5% (ex VAT) transaction fee on all transactions except the instant EFTs for which they charge 1.5% (ex Vat).
PayGate also allows you to process recurring payments.
Shopping Cart Integration:
- Shopify – Yes
- Woocommerce – Yes
- WordPress – Yes
- Magento – Yes
- Ecwid – Yes
- Prestashop – Yes
- Cs.cart – Yes
- Opencart – Yes
- nopCommerce – Yes
- Zencart – Yes
- Gravity Forms – Yes
Payflex
Payflex is another of the new kids on the payment gateway block in South Africa and they are changing the way businesses and customers transact online. Having only started in 2017, Pyflex are having a huge impact on the eCommerce landscape in South Africa.
Payflex allows you to sell more by offering your customers the opportunity to shop now but pay later, without having to pay hefty interest bills.
Once a transaction is approved, you are paid by Payflex and they cover the credit and fraud risk. It is an incredible product. Payflex have seen up to a 30% increase in sales fro mechats who use it, as well and up to an 70% increase in order value.
A huge advantage for merchants too is that Payflex does not charge upfront or ongoing fees for using them. They simply charge a few per transaction with makes using them an no brainer. It’s win win all round.
Payflex also has a restful API which means custom integration is possible but they also integrate with most of the big eCommerce platforms.
Shopping Cart Integration:
- Shopify – Yes
- Woocommerce – Yes
- Magento – Yes
- Opencart – Yes
- Prestashop – Yes
Yoco
Yoco is a South African payment gateway the is perfect if you want to be able to accept both in person and online payments. Yoco has grown incredibly since they started and currently over 120 000 merchants use Yoco as a payment gateway within their business.
In order to accept payments online you don’t need a card machine. If you would like to accept payments in your brick and mortar business then you are abe to purchase a card machine from Yoco too.
One thing that I love about Yoco is how seamless they make it to accept payments in South Africa today.
Unlike many of the other payment gateways in this article, Yoco’s fee structure is 100% transparent, and most importantly easy to understand.
Yoco do not charge a monthly fee to use their platform, they simply take a small transaction fee on every transaction. Those fees start at 3.4% for turn over up R20 000 in monthly and down to 3.05% if you turn over less than R100 000 per month. The more you sell, the lower the fees. If you sell more than R100 000 per month, Yoco are open to negotiating a rate for you.
For in-person sales using one of their card machines (Which start at just R399 once off) fees start at 2.95% up to R20 000 in turnover, down to 2.6% up to R100 000 in revenue. Again they are open to negotiating rates if your revenue is over R100 000.
Yoco also offer a service called ‘Pay by Link’ which allows you as a merchant to get paid on Whatsapp, Instagram, SMS and Email. It’s really simple to use. All you need to do is create a payment link on theYoco app, send it to your customer and they are able to pay using their credit card.
Yoco does integrate with most of the major eCommerce platforms, but unfortunately Yoco does not integrate with Shopfiy
Shopping Cart Integration:
PayPal
PayPal has been around for a long time, since 1998 to be in fact. In internet years, that is a lifetime! PayPal was one of the first businesses to allow people to make money transfers online, simply worldwide.
One major advantage of using PayPal as a South African business owner is that it allows you to sell internationally fairly easily. Getting a PayPal account set up and verified however can be a bit of a hack.
There are much easier gateways to set up but PayPal does add some credibility & trust to what you’re doing online because they are so well known.
As a South African (due to South African Reserve Bank foreign exchange controls) using a PayPal account and withdrawing your cash from it is not the easiest.
In order to get your money out of PayPal, you need to withdraw it into an FNB account. If you are not an FNB account holder you can have an FNB Withdraw Service account set up which will allow you to withdraw funds via FNB to your local South African bank account.
This is essentially a long way of saying if you’re looking for fast, cheap and easy then PayPal is not the obvious payment gateway choice as a South African.
Two big advantages of having a PayPal account is you do not need a merchant account and PayPal integrates with almost every eCommerce platform on the planet.
PayPal is also not the cheapest option around. I literally spent an hour on the PayPal fees page and couldn’t figure out exactly how their transaction and currency exchange fees work.
2Checkout
2Checkout is a payment gateway that not many businesses in South Africa are aware of. I’ve personally used 2Checkout as a payment gateway for two of my online businesses.
They are by far not the cheapest payment gateway but they do offer a lot. We’ve used 2Checkout to accept payments in multiple foreign currencies. 2Checkout has allowed us to charge our international clients in their currency (which has made a big difference to our conversion rates).
2Checkout allows you to take once off as well as recurring payments and you do not need a merchant account.
2Checkout integrates with over 120 eCommerce shopping carts and allows you to sell in over 200 countries and territories.
As far as costs are concerned, 2Checkout charges 3.5% plus $0.35 per transaction.
Shopping Cart Integration:
- Shopify – Yes
- Woocommerce – Yes
- WordPress – Yes
- Magento – Yes
- Ecwid – Yes
- Prestashop – Yes
- Cs.cart – Yes
- Opencart – Yes
- nopCommerce – Yes
- Zencart – Yes
- Gravity Forms – No
(See all the 2Checkout shopping cart integrations here)
Stripe
Stripe is one of the best payment gateways around but unfortunately it is not available to South African business owners out of the box. If you’re interested in Stripe, and how to get access to a Stripe account in South Africa, then I’ve written this post that you may find interesting.
One of the reasons that Stripe is so popular is because it makes accepting payments online unbelievably easy.
Millions of businesses worldwide trust Stripe and use their software & API to accept and send payments.
Stripe also integrates with most eCommerce platforms and also supports once off and recurring payments.
Shopping Cart Integration:
- Shopify – Yes
- Woocommerce – Yes
- WordPress – Yes
- Magento – Yes
- Ecwid – Yes
- Prestashop – Yes
- Cs.cart – Yes
- Opencart – Yes
- nopCommerce – Yes
- Zencart – Yes
- Gravity Forms – Yes
(You can see all the Stripe integrations here)
One of the things I love most about Stripe is how simple their pricing is. As a merchant you pay 2.9% plus $0.30 per transaction.
Snapscan
I am a huge fan of Snapscan, both as a consumer and a business owner. Snapscan is a contactless mobile payment solution that allows you to accept and send payment online or in person.
Snapscan’s fees are also very reasonable and start at just 3% (excluding VAT) per transaction and will drop down to 2.6% if your business turns over more than R80 000 per month.
Two negatives about Snapscan is that they don’t support recurring payments and only have a partial integration with Shopify.
Shopping Cart Integration:
- Shopify – Partial
- Woocommerce – Yes
- Magento – Yes
- Shopstar – Yes
- OpenCart – Yes
- PayGate – Yes
Even though Snapcan don’t integrate with a ton of eCommerce platforms they do have an API that you can use for custom integrations.
Netcash
Netcash is a South African Payment Gateway that specialises in debit orders, creditor salary payments as well as online payments to name just a few as well as an out of the box eCommerce payment solution.
With Netcash you are able to accept multiple payment methods, including Visa, Mastercard, American Express & Diners Club Credit Cards, EFT, Ozow, Visa Payments and Scan to Pay using a QR Code.
With the QR Code you are able to accepts payments from the following QR Wallets: Capitec, Nedbank Scan to Pay, FNB Pay, RMB Pay, ABSA, Standard Bank, QR Junction, Zapper, Spot and Snapscan.
Netcash also integrates directly with most of the popular eCommerce Platforms like WooCommerce, Magento, Prestashop, nopCommerce and cs.cart. Unfortunately Netcash doesn’t integrate with Shopify.
You also do not need a merchant account if you decide to use Netcash
Shopping Cart Integration:
- Shopify – No
- Woocommerce – Yes
- Magento – Yes
- Prestashop – Yes
- cs.cart – Yes
Wirecard – Mygate
This was a tough one to include, but I feel it is important to add to the list. Mygate South Africa was a fast growing payment gateway based out of Cape Town which was acquired by a German company called Wirecard in 2017.
Unfortunately Wirecard collapsed in June 2020 when it was discovered that they owed creditors over 3.5 million Euros due to fraud within the company.
Wirecard is currently being liquidated so I don’t think this is a viable payment gateway to be doing business right now.
I hope that you found this article helpful and that it will help you find the best payment gateway in South Africa that is best for your business.