PayPal launch 'boon for business'

Johannesburg - FNB announced on Thursday it has entered an agreement with global e-commerce group PayPal to make the service available to the group's South African banking clients.

The agreement would enable FNB customers to sell to PayPal's global customer base of more than 81 million active accounts and move the proceeds to their FNB accounts, the bank said.

"This new service allows customers to top up and withdraw funds to their qualifying FNB accounts from their PayPal accounts," a statement read.

"We are especially pleased to make this announcement on the eve of the 2010 Fifa World Cup, as South Africans will be able to join the global e-commerce marketplace."

The agreement with PayPal will also enable international businesses and individuals to transact with South African service providers via a secure and convenient payment service, said FNB CEO Michael Jordaan.

FNB will charge commission of 1.5% on PayPal transactions.

According to Jordaan. the launch of PayPal is part of FNB's ongoing strategy to invest in technology.

Both Jordaan and CEO of FNB's commercial banking division, Iris Dempsey, said PayPal was coming at a good time for business in South Africa.

"The small business environment is taking strain at the moment," said Dempsey, adding the use of PayPal will lower the cost of doing business.

Dempsey said she expects a number of new "virtual merchants" to launch soon, adding that South African consumers seemed to be getting their heads around their debt problems, with consumer demand starting to pick up. She felt tools like PayPal would help this process along.

The PayPal service has received approval from the Exchange Control Department of the South African Reserve Bank.

- Fin24.com