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i-Pay aims to help SMMEs with fast payment

Oct 05 2016 15:03
Carin Smith

Cape Town - What if an electronic funds transfer (EFT) could be done more quickly than it takes to enter a credit card code and expiry date?

That question has led to the start of i-Pay in South Africa three years ago.

According to Thomas Pays, co-founder and CEO of i-Pay, EFT does have a place in the e-commerce environment, but is seen as a distant cousin to the more convenient credit card.

He explains that the credit card was originally designed for a physical environment, with all its security measures - hologram, chip, four-digit pin - in place to secure transactions offline, but not so much online. Traditionally EFT on the other hand, is less prone to fraud, but slow and cumbersome to use in an e-commerce environment.

“We realised that if we could find a way of quickly automating the EFT process and integrate it into e-commerce platforms, we would have a great chance of success in Africa,” says Pays. That is why i-Pay is trying to build its own e-commerce platform suitable for Africa.

“Our initial idea for the platform was that anyone could start accepting payment within two minutes after setting up their website, but we found that credit card transactions presented problems around fraud and security, with the solution being to make EFT easier," says Pays.

"But when we started marketing the e-commerce platform to banks and large retailers, all the enquiries instead revolved around this unique EFT gateway.”

Recently i-Pay secured first round venture capital funding and has increased the amount of transactions through the gateway by 500% in the first nine months of 2016.

READ: What’s keeping SME owners awake at night?

More than one way of doing business

According to Pays the positive point of i-Pay lies in the different types of transactions the payment gateway can be used for. With the ability to send requests for payments via SMS, QR Code or push notifications, the applications are "endless" and applicable to different sized business.

"For stall holders and small shop owners it offers the ability to SMS a client the i-Pay link in store when they want to transact, with the client opening the link via the phone’s browser (no app required), log into the highly secured i-Pay gateway with their banking details, approve the transaction and be on their way," explains Pays.

"For vendors it allows for the inclusion of a link or QR code in an invoice, enabling clients to pay directly, quickly and easily once received. In all these cases there is no need for the payer to first set up a beneficiary since i-Pay deals with this on the back end, while also handling reconciliation."

READ: Acca releases financial guide for entrepreneurs

The future of EFT

“Our main target is to be present in one hundred countries in the next five years,” says Pays. “What’s very important for us when taking on new markets is that we can make a guaranteed success of each venture. You don’t want to get burnt and use that as a lesson for the next one.”

After establishing a base of operation in South Africa, i-Pay plans to expand to Nigeria, Kenya, Ghana and Australia in 2017. Thereafter, Europe is in the company’s sight.

"We don’t try to create apps or the products around it. The only focus i-Pay has is to make transacting as simple and quick as possible,” says Pays.

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africa  |  entrepreneurs  |  smmes  |  ecommerce  |  small business


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