Interswitch webpay, a dying goldmine
Interswitch the leading payment gateway in Nigeria, in fact has a near monopoly stronghold on the e-payment industry in Nigeria. Though, it is supposed to be the preferred gateway for online payments but has scared web merchants away with its exorbitant setup fee of N150, 000. Interswitch charges N150, 000 for setup fee, 1.5% per transaction and N2, 000 flat on transaction above N150, 000. I’d expected that it automatically transfer its presence on the card system to online but I must say, its strategy is not internet-business friendly.
2Checkout a top brand in online payment gateway accepts credit cards (Master card, Visa card, Discovery and many others) on its platform. The setup cost is just $49 and 5.5% + 55 cent per transaction which is still high but takes off the setup huddle.
It won’t belong that competitors grab the space with the development going on around the web space in Nigeria. I have spoken with couple of innovators and we should expect many more e-payment platform before the year end. We could even have a Nigerian M-Pesa before December. GTB (they have a discounted web pay platform that works fine with Interswitch) recently launched a master card powered debit card and gradually disconnecting from Interswitch.
Personally, I think the setup fee should not be more than N10, 000 while they make up the money from the commission from turn over on the site operating on their platform.
What do you think about Interswitch strategy? Do you think they will change soon or be forced to change by the market? How do you think new entrants with influence their decision?
Short term thinking = long term loss.
@oladejo good to see you here!
wow! indeed it’s short term. cos if one subscribes at 10k you get to pay more than 150k in commission in the long run.
That helps you, helps interswitch and everyone is happy.
[...] which caught my attention was the growing number of alternatives to the Interswitch platform. This article on webtrendsng.com talks about one of these (in the online payment domain) namely 2checkout. The [...]
I think Google and PayPay are leaving billions on the table. They should be all over ePayments in Africa and yet they don't allow most African countries (even ones Google has Adwords in!) to make payments using their systems.
It's a critical issue we will solve by continually working on the positive side of Africa. I can understand their skepticism about us, they are business and they need to protect themselves. In the recent G-Nigeria day organized by Google, people raise this issue and Google promised to work on it as they getting to know that Africa is one of their next big mover.
http://www.1naira-auction.com will work with Interswitch and PayPal. Sign up now and get 5 free bids!
http://www.1naira-auction.com will work with Interswitch and PayPal. Sign up now and get 5 free bids!
@admin – true word. Even called them once to say same thing but lady said she's not in position to determine that. Low entry cost, make the rest from transaction fee is the way to go. Afterall they should have made enough money by now. Same case with GSM companies…