E-commerce growth will 'catch up' to traditional buying

2013-09-13 08:41
Digital e-commerce solutions are set to catch up to traditional payment methods. (Duncan Alfreds, News24)

Digital e-commerce solutions are set to catch up to traditional payment methods. (Duncan Alfreds, News24)

Multimedia   ·   User Galleries   ·   News in Pictures Send us your pictures  ·  Send us your stories

Cape Town - While e-commerce is growing fast in South Africa, it will take some time for the platform to overtake traditional sales, an industry expert has said.

"E-commerce is still such a small percentage of the overall market that this is still a number of years away," Mark Chirnside, CEO of PayU told News24.

PayU is a mobile and online payment service provider and Chirnside said that online transactions are growing rapidly in SA.

"The growth in online is significant again this year, with some key merchants growing above others. The growth in small merchants going for the first time online is very significant, this is helped by such services as EasyMerchant from PayU."

First National Bank also sees e-commerce as a growth area that will eventually become mainstream.

Growth

"Right now we speak of it [e-commerce] as if it's something special or something new. As it continues its compound growth which will continue in high double digits for many years... it will just become the normal way of doing business," FNB CEO Michael Jordaan told News24.

Some estimate that e-commerce transactions are growing at 12.95% a year and as more people adopt smartphone technology and data costs decline, it is expected that the growth rate will escalate.

"We'll probably look back at those antiquated old days when you had to physically go and buy things and that will suddenly become the quaint thing," Jordaan added.

Goldman Sachs reported in 2011 that global e-commerce sales would reach $963bn this year and grow at 19.4%.

In SA, mobile is the sharp end of e-commerce growth, despite the dominance of computers, said Chirnside.

"Computer still dominates e-commerce payment transactions, but tablet and mobile are now exceeding 30% monthly."

PayU said that as e-commerce platforms became more successful, it was likely that banks would enter the market more directly.

Solutions

"Banks are unlikely to offer the number of payment options, particularly from competing banks that would reduce the options a merchant can offer. It is possible and I'm certain a number of banks will attempt to enter the market," Chirnside argued.

Jordaan seemed to agree with this view, saying that the e-commerce ecosystem was broad.

"I do think there's room in the broader ecosystem for third party payment providers. There certainly are institutions who want to operate with many banks and in that role third party payment operators can actually perform a useful interface."

He said that solutions where competitors co-operated to deliver the best customer experience were probably likely to succeed.

"We're good at building our interface with the customer, not always so good at building them with our competitors. I think it's quite a rich ecosystem and there's a lot of room for 'co-opetition' - that will be one of the words of the future."


- Follow Duncan on Twitter
- News24
Read more on:    fnb  |  mobile  |  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
3 comments
Add your comment
Comment 0 characters remaining

Inside News24

 
/News

Jobs in Cape Town [change area]

Property [change area]

HOUSES FOR SALE IN Somerset West

Houses R 1 999 000

HOUSES FOR SALE IN Paarl

Houses R 1 795 000

Travel - Look, Book, Go!

Kalahari.com - shop online today

Save up to 40% on outdoor accessories!

Tents, sleeping, day packs and more. While stocks last. Shop now!

Month End Madness Sale!

Save up to 60% on across a wide range of goods from books to electronics, DVDs and many more. Sale end 31 January 2015. Shop now!

Valentine’s Day gifts – 14 Feb!

Gifts to spoil him and her. While stocks last. Shop now!

30% off fragrances

Get 30% off fragrances for him and her. While stocks last. Shop now!

Up to 30% off All Textbooks

Save up to 30% off an extensive range of prescribed textbooks for all major universities and FET colleges. Shop Now!

OLX Free Classifieds [change area]

Horoscopes
Aquarius
Aquarius

It is easy to get bogged down by things today. The Taurus Moon highlights the comforts and pleasures of life. You may have the...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.