Introduction
Imagine this: You’ve spent months building your online store. The design is sleek, your products are high-quality, and traffic is starting to flow in. But then—you notice abandoned carts piling up. Customers are getting to checkout and then… nothing. No purchase. No payment. What’s going wrong?
For many small and medium-sized businesses (SMBs) in South Africa, the problem often lies in the payment gateway. If customers don’t trust the checkout process, find it too complicated, or don’t see their preferred payment option, they’ll walk away.
Choosing the right payment gateway isn’t just about processing transactions—it’s about giving your customers confidence to buy. In this guide, we’ll compare South Africa’s top payment gateways, breaking down their pros and cons so you can find the best fit for your business.
1. What is a Payment Gateway & Why Does It Matter?
Think of a payment gateway as the cash register of your online store. Just like in a physical shop where customers swipe their card or pay with their phone, an online payment gateway ensures that money moves safely from your customer’s account to yours.
But here’s where it gets tricky: Not all payment gateways are created equal. Some are faster, some charge lower fees, and others offer better fraud protection. Choose the wrong one, and you could end up losing customers before they even complete a purchase.
The Reality for SA Businesses
A local boutique owner once shared with me how she initially set up her ecommerce store with a foreign payment gateway. The result? Her South African customers kept abandoning their carts because they couldn’t use local bank transfers or instant EFT. Once she switched to a gateway with local payment options, her sales jumped by 30% in just a month.
💡 Lesson: The right payment gateway isn’t just about what works—it’s about what works for your audience.
2. Key Factors to Consider When Choosing a Payment Gateway
Before we compare South Africa’s top payment gateways, let’s talk about what actually matters.
🔹 Transaction Fees & Costs
Every gateway charges fees, but the structure varies. Some charge a flat rate per transaction, while others take a percentage of sales. These small costs can add up fast, especially for high-volume businesses.
📌 Example: If you’re selling a R500 product and a payment gateway charges 3.5% per transaction, that’s R17.50 per sale. Over 1,000 sales, you’d pay R17,500 just in fees!
🔹 Security & Fraud Protection
Would you hand over your credit card details to a suspicious website? Neither would your customers. A good payment gateway offers fraud detection, data encryption, and compliance with PCI DSS security standards.
🔹 Ease of Integration
If you’re using platforms like Shopify, WooCommerce, or Magento, you want a gateway that integrates seamlessly. Otherwise, you’ll be stuck dealing with technical headaches.
🔹 Payment Methods Supported
South Africans use a mix of payment options:
✔️ Credit & debit cards (Visa, Mastercard)
✔️ Instant EFT (for those who prefer bank transfers)
✔️ Mobile wallets (like SnapScan)
Not offering a variety of payment methods can alienate a chunk of your potential customers.
3. Comparing South Africa’s Top Payment Gateways (Pros & Cons)
Now that we know what to look for, let’s compare some of SA’s most popular payment gateways:
| Payment Gateway | Pros | Cons | Best For |
|---|---|---|---|
| PayFast | Instant EFT, widely used, no monthly fees | Higher per-transaction fees | SMEs, WooCommerce |
| Yoco | Online & offline payments, user-friendly | Limited customization | Small businesses, startups |
| Peach Payments | Strong security, global reach | Setup complexity | Growing businesses, enterprises |
| Ozow | Seamless EFT payments, low fees | No credit card support | Local businesses prioritizing EFT |
| SnapScan | Mobile-first, trusted brand | Not ideal for all industries | Restaurants, small retailers |
Which One is Right for You?
- New online stores: PayFast is an easy, no-fuss option.
- Physical stores adding ecommerce: Yoco integrates well with in-person sales.
- Security-conscious businesses: Peach Payments offers strong fraud protection.
- Cost-sensitive businesses: Ozow is great for low-fee EFT payments.
- Mobile-driven stores: SnapScan is perfect for quick mobile transactions.
🔎 Real-World Story: A Cape Town-based furniture store found that their customers preferred to pay via EFT rather than credit card. After switching to Ozow, their abandoned cart rate dropped by 25%!
Here’s a comparison of the pricing structures for some of South Africa’s top payment gateways:
| Payment Gateway | Transaction Fees | Additional Costs | Notes |
|---|---|---|---|
| PayFast | – Credit & Cheque Cards: 3.2% + R2.00 per transaction – Instant EFT: 2.0% (minimum R2.00) per transaction |
– Payout Fee: R8.70 per payout – Immediate Payouts: 0.8% (minimum R14.00) – Refunds: R2.00 per refund |
– Supports various payment methods, including Capitec Pay, Apple Pay, Samsung Pay, SnapScan, and Zapper, each with specific fees. |
| Yoco | – Local In-Person Transactions: 2.5% – 2.7% – Online Transactions: 2.95% – 3.40% – Yoco EFT: 2.0% |
– Connectivity Fee: R49 per card machine per month – Payout Fee: R2.50 per daily payout |
– Transaction fees decrease as monthly turnover increases. – Custom rates available for businesses transacting over R200,000 per month. |
| Peach Payments | Custom pricing based on business requirements. | Information not publicly available. | – Tailored solutions for growing businesses and enterprises. – Interested businesses should contact Peach Payments directly for detailed pricing. |
| Ozow | – Instant EFT: 2.0% per transaction | – No setup or monthly fees | – Focuses on seamless EFT payments. – Does not support credit card payments. |
| SnapScan | – Standard Fee: 3.0% per transaction | – No monthly fees | – Mobile-first payment solution popular among small retailers and restaurants. |
Please note that the information provided is based on available data as of March 2025. For the most accurate and up-to-date pricing details, it’s recommended to contact each payment gateway directly or visit their official websites.
4. How to Set Up a Payment Gateway for Your Online Store
Ready to set up your payment gateway? Follow these steps:
1️⃣ Sign up – Choose your provider and create an account.
2️⃣ Verify your business – Most require business registration details.
3️⃣ Integrate with your website – Platforms like WooCommerce, Shopify, and Magento offer easy plug-ins.
4️⃣ Test transactions – Run a test purchase to ensure smooth processing.
5️⃣ Go live! – Announce new payment options to customers.
🚀 Pro Tip: Consider offering multiple gateways to give customers more choice.
Conclusion
The right payment gateway isn’t just a technical decision—it’s a business strategy. If your customers can pay easily and securely, your sales will grow.
Now it’s your turn! Which payment gateway fits your business best? Need help setting it up? Let’s chat! 🚀
Call us on 066 554 2856. Email us at admin@jitcon.co.za. Connect via our facebook page https://www.facebook.com/profile.php?id=61556348266994.
