SA e-commerce 'expansion possible'

2011-08-22 11:16
Cape Town - The new online debit card system has the potential to expand e-commerce to a range of new customers and merchants, the developer has said.

"We're kind of ready now for e-commerce growth because the internet access is there. What we're hoping is that because people can now start to use the debit card, it will now accelerate the usage of the e-commerce world," head of new business at MTN MobileMoney Dave Parratt told News24.

The expansion would open new kinds of opportunities for customers and merchants, he said.

"The exciting thing about the e-commerce world is not the existing merchants as we know it: I think it's that the debit card customer can now look to enjoy new types of merchant categories."

The internationally patented payD system aims to bring people who have bank accounts, but no credit cards, into e-commerce by making online payments similar to buying with a debit card at a store.

"For example, if I want to make a payment for my rates and taxes, I need to logon to internet banking. But if you got a message saying: 'Your rates and taxes are due would you like to pay for them?' And you said 'Yes', and the message came back saying: 'This is how much you owe, enter your PIN', it changes the game.

"There are about 700 million bills in South Africa alone could be paid using this system," Parratt said.

Solutions

A small percentage of South Africans have credit cards and buying online has resulted in a range of solutions.

Social network MXit has launched Moola to allow users to purchase virtual products online and is moving towards an e-wallet.

PayPal launched in SA recently and BlackBerry maker Research In Motion has allowed purchases with BlackBerry Messenger (BBM) linked to airtime.

Parratt said that each system had its shortcomings and didn't cater to everyone who had a bank account.

"The real problem you've got with all of those alternative environments is they're either e-currencies at different levels or they are wallets that are only able to operate in the e-commerce world.

"Yet every one of the customers that they target has got a bank account and a debit card.

"So if you think about what you needed to do with these different wallet systems: I had to go to my bank account. The only way I could get to it was logon to internet banking, make a payment to top up that wallet and use that wallet to shop," he said.

Access


Differentiating itself from an online wallet system, the payD system allows users to shop as if they were in a retail store, Parratt said.

"Hopefully I put enough money into that wallet or if I had excess money in that wallet I couldn't get that money out. Whereas what this does, it turns around and it's no different to shopping in a retail store. It transcends all of those components.

In the developed world, credit cards are commonly used to transact online and Apple users this payment methodology for purchases from its iTunes stores worldwide.

However, this method may exclude those developing countries like SA, India and Brazil where credit card access is not universal.

"The US is quite different to the rest of the world. They just don't realise that the vast majority of the population of the world that might be banked, don't have credit cards, therefore they're excluded from e-commerce," said Parratt.

He said that the crisis in e-commerce in SA came about in 2000 as the market was expanding, but payment systems were unavailable.

"The real crisis came about because not enough people qualified for credit cards - it's only about 3% to 5% of the population."

Strategy

The system only caters to a few merchants at the moment, but the strategy is to get more merchants and banks on the system quickly.

"Our strategy of getting new merchants was rather than going one by one, we went to the payment aggregators. We probably have, lined up in the background, about 3 000 merchants that will be coming on.

"It could take up to a year to bring them on, but we will see an acceleration of the rate that they come on," Parratt said.


- Follow Duncan on Twitter
 
- News24
Read more on:    e-commerce
NEXT ON NEWS24X
SHARE:

Read News24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
1 comment
Add your comment
Comment 0 characters remaining
 

Inside News24

 
/Sport
 

Goalkeeper saves five penalties with his FACE!

Nothing, and we mean nothing, will keep goalkeeper Scott Stirling from stopping the ball!

 
 

Men24.com

Hottie of the day: Jesselyn
This invention makes farts smell like chocolate!
11 things men don’t know about their clothes
Hilarious mortal kombat elevator prank!

Jobs in Cape Town [change area]

Property [change area]

Travel - Look, Book, Go!

Magical Massinga

Spend 5 nights at the gorgeous Massinga Beach Lodge in Mozambique and only pay for 4 from R13 220 per person sharing. Includes return flights, accommodation, transfers and romantic turndown. Book now!

Kalahari.com - shop online today

Save up to 60% on toys!

Don’t miss out on this hot offer, save up to 60% on toys. While stocks last. Shop now!

Festive gifts!

Check out our awesome range of festive gifts to make everyone’s wishes come true. Shop now!

Seen something you like in our catalogue?

Find the perfect gift and save up to R5000 – As seen on the catalogue. Hurry and shop now!

Save up to R2200 on electronics! – As seen in the catalogue

Wishing for tech gadgets this festive? Save up to R2100 on hot tech products at kalahari.com. While stocks last. Shop now!

Up to 35% off books

Save up to 35% on the latest page-turners. While stocks last. Shop now!

OLX Free Classifieds [change area]

Samsung Galaxy s4

Mobile, Cell Phones in South Africa, Western Cape, Cape Town. Date October 24

Best bargain in big bay

Real Estate, Houses - Apartments for Sale in South Africa, Western Cape, Cape Town. Date October 25

VW Golf 6, 1.6 Trendline (Excellent condition)

Vehicles, Cars in South Africa, Western Cape, Cape Town. Date October 25

Horoscopes
Aquarius
Aquarius

The Moon has moved into your sign, emphasizing the need to connect things to work together. There is a tendency to focus too far...read more

There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.








Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.