Category Archives: paypal

Getting Paid for e-commerce in Africa

When it comes to support, from PayPal’s perspective, your value is worthless. PayPal is a terrible company to deal with; they will withhold money for quasi-fraudulent reasons, that have long been suspected to be pools that are linked to high interest-earning fixed deposit accounts or something along that line. When they withhold your money, they are actually playing monopoly with your money, and the reasons are always obscure. Your account will be shut down for even more obscure reasons.

PayPal deleted this tweet

PayPal never points to a specific issue, and since they are a near-monopoly, they are above the law, and you, in a third-world country, can only wait and pray. PayPal can act with impunity and there are no mechanisms for third-world individuals to hold PayPal accountable, and they know this, so it’s not implausible for them to take advantage. They do.

Stripe on the other hand is the king of double standards. When it comes to engagements with Westerners, Stripe is your friend through and through, but the minute you, a third-world resident, control a USA entity, the double standards come out. You can’t do certain things that other Western companies are free to do, and if you have a chargeback as a foreign-held entity, Stripe will hold and eventually shut down your account because it is deemed as high risk, even though you or your company might be a target of fraud.

Again, Stripe takes advantage of the lack of accountability. If you acquire Stripe through a 3rd party like Shopify or Woocommerce, then you will NEVER get your account approved, regardless of however clean and legitimate your paperwork is. They will always say their risk department is assessing your paperwork, and if that goes past 3 months, you will almost certainly give up. They want that. However, the double standard is worse, since Stripe is financing Westerners to come build fintech in Africa (e.g. Wave).

As for Flutterwave, it is a better experience. You are treated like an actual human being. You talk to people who speak your language, understand your problems, help you solve them and treat you like an actual human being. You have an actual telephone number you can use and talk to someone who will actually be concerned and help you overcome your hurdles. Flutterwave makes you feel like you belong, and it might be business at the end of the day, but it’s how it’s supposed to be done. With empathy!

Comment by a company founder who moved to Flutterwave.

PayPal in Kenya

At long last, PayPal is now officially available  in Kenya for usage without the worry of getting deactivated . Paypal, which has 137 million users, in 193 countries, has been in Africa for three years in a partnership with FNB (SA), and Kenya’s Equity Bank becomes their second partner in Africa. The service is already active in Kenya for local merchants such as freelance contractors and tourism sites to use on their websites to accept secure global payments.

At the launch, the Equity Bank CEO said that there were possibly 100,000 users in Kenya with PayPal accounts, but who could not withdraw their money, until now. One needs to have a debit or credit card that allows online transactions to use and to withdraw cash from PayPal which will be done through a customer’s account at Equity Bank – and this may take a few days, and attracts a 1.5% fee on top of PayPal’s charges. For now, one can’t move money from a bank account to PayPal, but only use cards to send money.  

Nation Hela to revolutionize remittances & debit cards in Kenya?

On August 15, 2012, Kenya’s Nation Media Group (NMG) launched NationHela in partnership with Diamond Trust Bank and Craft Silicon. NationHela had been first unveiled the previous week when NMG announced 14% revenue growth to Kshs 5.8 billion and a 23% rise in profits of Kshs 1.37 billion and an interim dividend of Kshs 2.50 per share  for the first half of 2012.

Why NationHela? For NMG that has millions of online newspaper readers every month, a good fraction of who are in the diaspora, and who also send remittances to Kenya, the platform is a chance for them to send money without leaving their computer (or logging off the newspaper site)  – by entering debit or credit card numbers to send to a Kenyan phone number. 

At the launch, a Central Bank of Kenya a figure was cited of remittances of $590 million in the year  to June (up from $409 million the previous year) through formal money transfer channels.

Senders also get value as NationHela can be 30% cheaper overall (charging $12.5 to send $200 compared to $15 for other services), while for  the recipient it knocks out the necessity of taking a matatu (vehicle) to town or finding a Western Union agent to withdraw cash. 

Diamond Trust who are the 7th largest bank, and the largest agent of Western Union in Kenya, handled the banking regulatory and approvals, and will also do the backoffice processing of money movement, agents, currency exchanges, float etc., while Craft Silicon provided the mobile interface (familiar to anyone who’s used their Elma) through which users will access Hela by USSD on a mobile phone to get notifications, send or receive money through mpesa to other card users, pay some utility bills, block a lost/stolen card, see a mini statement /balance among other features.

Some cited uses of the card include:

  •  Make online purchases as a visa debit card
  • Move money to or from mpesa
  • Withdraw cash at any ATM via visa
  • Use the debit card in a supermarket to make payments
Other future or potential uses include:
  •  Pay dividends straight to cards (maybe starting with Diamond Trust and NMG shareholders)  
  • Kenyans with paypal can move their online money on to the card and cash out payments
  • Senders will also be able to see how card recipients use the money they have sent (perhaps answering along standing issue about the misuse of remittances.
  • Take NationHela to Tanzania and Uganda where both the Nation and Diamond Trust are
  • Pay staff travel  allowances and imprest at companies (said to happen at NMG)

Outlook: Some concerns have been expressed, that NationHela may not work out, or that it’s going to distract NMG  from its core media business. Also the web interface needs some tweaks to make the card easier to work.

While the awareness and usage of debit and credit cards in Kenya has been low, for NationaHela there  are plans for online education & marketing campaigns targeted at the diaspora, combined with roadshows and town hall meetings around Kenya to register users, convert agents, and show how to use it on a day to day basis – and we’ll see where they are in a year.