Online Payment Methods for Small Businesses in South Africa

Jethro Solomon • September 23, 2023

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Disclaimer: payPod is not affiliated with any of the providers listed in this article, even where we may provide integration.

In today's digital era, accepting payments online is no longer a luxury - it's a necessity. Small business owners in South Africa have a range of options for online payment methods, which not only facilitate seamless transactions but also enhance customer experience. In this article, we'll explore some of the most popular online payment methods available to small businesses in South Africa, with a focus on PayFast and Yoco. And we'll also delve into how our own software, payPod, can integrate these payment buttons right into your invoices.

Why Online Payments Matter

Before we dive into the specifics, it's important to understand why you should consider implementing online payments if you haven’t already. Online payments are known to:

  • Increase Sales: Easier checkouts lead to fewer cart abandonments.
  • Improve Cash Flow: Instant payments can boost your business's liquidity.
  • Enhance Customer Experience: Customers enjoy the convenience of paying online, which can lead to repeat business.

Even if you do not run an ecommerce store, providing digital payment options to your customers still benefits your business. It is much easier for your customers to pay you without the hassle of adding you as a beneficiary on their banking app - and eliminates the human error that can occur.

PayFast: Speed and Flexibility

PayFast is one of South Africa’s leading payment gateways, offering a multitude of payment options including instant EFT, credit card, and even scan-to-pay. Here are some features that make PayFast popular:

  • User-Friendly: Setting up a PayFast account and integrating it with your website is straightforward.
  • Multiple Payment Options: From debit cards, credit cards, instant EFT and more, PayFast lets your customer choose their preferred payment method.
  • Security: PayFast offers robust security features to protect against fraud.
  • Business Funding / Easy Advance: PayFast, in collaboration with Retail Capital, offer quick funding based on your PayFast history. This can be used to manage cash flow or expand your business.

PayFast's Extended Payment Methods

One of the additional advantages of using PayFast as your payment gateway is its support for other popular payment methods like SnapScan, Ozow, and Zapper. By setting up a PayFast account, you not only gain access to its range of payment options but also automatically have the capability to accept payments via these other methods. This makes PayFast an extremely versatile choice, serving as a one-stop-shop for all your online payment needs.

payPod and PayFast

Our own software, payPod, supports PayFast integration. This means you can easily insert a PayFast payment button directly into your invoices, making it incredibly convenient for your clients to settle their payments instantly.

Yoco: Designed for Small Businesses

Yoco focuses on providing payment solutions specifically tailored for small businesses. The service allows for easy card payments both in person and online, and offers some unique features:

  • Low Fees: Yoco has a transparent fee structure with no monthly rental costs.
  • Yoco Go: A portable card machine that is affordable and convenient for small businesses.
  • Analytics: Yoco offers insightful sales analytics through its dashboard.
  • Business Funding / Yoco Capital: Yoco too provides a cash advance service much like PayFast.

Unlike PayFast, Yoco only supports card and EFT payments, and may not support "scan to pay" options. That said, if you need to collect in-person payments alongside online payments, Yoco is a great choice.

payPod and Yoco

Much like with PayFast, payPod allows you to integrate a Yoco payment button into your invoices. This functionality streamlines the payment process and keeps everything centralized in one system.

Honorary Mentions: Other South African Credit Card Processors

While PayFast and Yoco dominate a considerable share of the market (especially for small businesses), several other credit card processors in South Africa also offer robust solutions for online payments. These include:

  • Netcash: Known for its secure online payment processing, Netcash is another option to consider for card payments and debit orders.

  • PayU: Operating in multiple countries, PayU provides a variety of payment solutions, including credit card processing, that are easy to integrate.

  • Peach Payments: Aimed at simplifying online payment processing, Peach Payments offers smooth and secure transactions.

Each of these options has its own set of features and benefits, so it's worth spending some time to understand which one aligns best with your business needs.

Final Thoughts

The digital transformation of the South African economy presents small businesses with the perfect opportunity to adopt online payment systems. Whether you go for an all-rounder like PayFast or opt for a small business specialist like Yoco, integrating these payment methods into your invoicing system can greatly benefit your business. And with payPod’s easy integration of PayFast and Yoco payment buttons, collecting payments online has never been easier.

So, take your small business to the next level by embracing the myriad of online payment options available in South Africa.