Consumers no longer need a credit card in order to buy online. Major retail sites are increasingly making it easier for consumers to conduct shopping in a digital environment - but it has been a luxury not available to those who only have access to payment by debit card, which has traditionally not been accepted in most e-commerce environments.
Striving for convenience for consumers and merchants alike, payment solutions company PayU has recently joined forces with Oltio, a joint venture company between Standard Bank and MTN; a move which now enables consumers to make debit card payments through the mobile payment solution, payD.
This venture now sees mobile phones applied as remote point of sale devices, enabling millions of South Africans to utilise their bank PIN-based debit cards online.
Enter PIN on mobile phone
In order to purchase online via payD, consumers, using their normal bank PIN-based debit, credit or cheque card, need to enter their card's ATM PIN into their mobile phone when prompted. This is based on the same operation system as MasterCard Mobile which means customers opting to buy with debit cards online can now do so on any site where the payD or MasterCard Mobile emblem is displayed.
Informed by international studies - with Euromonitor International indicating a total of 35.2 million debit cards versus eight million credit cards in circulation in South Africa in 2011- this method of payment clearly addresses a huge need in the market. Says Mark Chirnside, CEO of PayU: "We know that only 6,25% of South Africans have a credit card, and that, by comparison, the use of smartphones and ordinary cellphones are growing at a phenomenal pace in Africa. This combination of a mobile payment solution allowing for alternative payment methods is just another way PayU is ensuring an on-trend approach to the e-commerce environment."
In addition, this online payment method also addresses the issue of insecurity still experienced by many online shoppers. "This method requires a PIN, and not just a card number, to authorise each transaction, and, with a further link to your cellphone number, security risks are significantly reduced," says Chirnside.
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