Africa experiences millions of payments every day, but very few happen online. In Nigeria, just about 1% of transactions happen online. The country collected $150 billion in business revenues in 2015, although those transactions were mostly in shops and in physical business establishments. There are many barriers businesses need to face to accept payments online and that’s what Paystack is fixing.
Founded by Shola Akinlade and Ezra Olubi, paystack allows online retailers to offer customers virtually any payment option including paying by MasterCard, Visa, Verve, or directly from a banking account. Online Nigerian businesses can accept payments from anyone in the world. With Paystack, Nigerian businesses can add a significant amount of revenue through online transactions to its economy. Nigeria has a rapidly growing digital mobile economy. Online shopping and payments are expected to increase with 400 million more smartphone connections in Nigeria by 2020.
Paystack simplified the previously difficult customer experience, reduced integration time from an average of 3 weeks to less than 30 mins, and today they can boast of the best transaction success rates in the market.
Consumers do not need to sign up to use Paystack, all that is required is a Mastercard, Visa or Verve debit card to pay on Paystack merchant sites. Merchants on the other hand are required to sign up. However, in order to integrate Paystack to start receiving on their site, merchants will have to fill a “go live” request form to upload their business details for verification.
Depending on how well these details are presented, verified merchants can go live in a matter of minutes to several hours, because the process of verification is done manually. While this may take a bit of time, it is to ensure that compliance is carried out.
Concerning any fees, merchants are only charged on a per transaction basis. In addition to a flat rate of ₦100, between 1.9% and 3.9% of transaction value is deducted for local and international cards respectively. The ₦100 fee is however waived for transactions less than ₦2500.
Paystack’s mission is to transform and overhaul the interaction between business and consumers and to build a payments product for Africa to act as a catalyst for the continent’s online economy.
So far, it’s vision and objectives have been highly publicized. In December last year, Paystack has closed a US$1.3 million seed investment round, with participation from numerous international investors. Then earlier this year, it announced that it hit 1 billion Naira ($3.2 million) in monthly transaction volume from consumers to merchants. The next milestone, according to the team is ₦10 billion monthly transaction volume.