Tag Archives: fnb

Subscription payments in South Africa

So you’re a South African business that wants to take payments for a subscription-based service. You’re probably going to have a mix of local and international customers, and want to know what services are available.

Well, I’ve got some good news, and some bad news.

The good news is – there are ways of doing this. Even with South Africa’s relative backwardness in global economic participation there are still a few options.

The bad news is: the best options are currently unavailable to you, and are likely to stay unavailable in the long term. If you have the means to do so, incorporating and setting up banking in a major economy might be the better option.

Onwards!

Local Options – EFT

It goes without saying that local EFT is an option. If you don’t want to wait for interbank delays, there are a few vendors that offer Instant EFT solutions:

In my experience, PayFast has the easier onboarding path, but you might have a tougher time integrating it into your application. None of those solutions incorporate any sort of subscription management though – it’s on you to keep the accounts in check.

Depending on your capabilities, debit orders might be an option. If you can obtain debit order mandates from your customers (signed papers, recorded calls, etc), you can use Sage Pay’s NAEDO collection system: https://sagepay.co.za/services/debit-order-collection/

Local Options – Credit Cards

This is where it gets a bit more interesting!

PayFast allows you to accept credit cards online, and is relatively easy to set up if you’re not looking for advanced integration. They will make your life easier on one front – they understand subscription management: https://www.payfast.co.za/subscriptions/

I’ve worked with their API before though, and you’re going to need to exercise extreme patience with it in order to get anything done. I hope their systems and documentation improve over time!

PayGate also offers a subscription product, but they make it obvious that they’re geared towards larger businesses – you have to start the process with a sales inquiry: https://www.paygate.co.za/paygate-products/paysubs/

Global Options

There are too many global vendors to list, but when it comes to what you can feasibly use in South Africa, it narrows down to one pretty quickly: PayPal.

I implemented full-on subscription management using PayPal for Write500 – and it worked quite well. PayPal can accept credit cards, manage subscriptions (including pausing and resuming), and has a solid set of developer tools for integrating it into your application.

You’ll want to create a Billing Plan (your product), then a Billing Agreement (a paid subscription to it), so that Paypal can issue Invoices and settle them automatically. Start here: https://developer.paypal.com/docs/api

The one limitation: You need an FNB account to receive any of that money here in SA.

Going further abroad, you do have the option of incorporating a business remotely. It’s a ton of paperwork (depending on a ton of factors), but one vendor is offering a simple solution to it: Stripe Atlas.

For a one-time fee of $500, and a decent amount of effort, you can incorporate remotely in Delaware – including all the documentation and registration you need to run a corporation within the US. That includes a Stripe.com account, which is basically the global, golden standard for subscription credit card billing.

There’s a couple of major downsides on the administrative side, though – repatriating that money comes with its own set of tax challenges. From what I’ve seen, this is only a really viable option if you’re expecting to do a lot of subscription billing for global customers, and the Stripe fees are a more attractive option.

Other Options

I would be remiss if I didn’t mention PeachPayments – a Cape Town-based company that attempts to make all of the above easier for local companies. If you’re not keen on the idea of getting your hands dirty with integration logic and setting up subscription billing, those will be the folks to talk to.

Then of course, there’s bitcoin. If you really feel like jumping into the murky waters of cryptocurrency for your project, give Coinbase a try. They offer a recurring billing option denominated in Bitcoin. To cash those coins out locally, the simplest option will probably be to hold a Luno.com wallet, and sell those coins on the local exchange to recover your Rands.

I know that there are likely several other services out there, but if I were starting from scratch today, and wanted to be able to accept payments from a global customer base I’d probably still go with PayPal, myself.