No ad to show here.

MTN Mobile Money launches debit card-based online shopping solution

eCommerce service provider, MTN Mobile Money, has launched a mobile payment mechanism, which will enable users to purchase products online using a debit card.

No ad to show here.

MTN Mobile Money says the mechanism, called payD, will enable millions of South Africans to make secure, online payments using only their pin-based debit cards.

It is hoped that payD will provide a boost to South Africa’s lagging ecommerce market.

World Wide Worx’s Online Retail in SA 2011 report shows that retail ecommerce hit R2 billion last year.

“This sounds big”, says Dave Parratt, head of new business development at MTN Mobile Money, “but it’s just 0.36 percent of our country’s total revenue sales. Why is it so incredibly low? The answer lies with both the consumer and the merchant.

On the consumer side, only three percent of our population has credit cards, and this is generally the only way to transact online. On the merchant side, transaction costs for credit cards cut deep into margins and this reduces the range of products that e-tailers are able to offer online.”

The ability to purchase online using debit cards, takes the percentage of potential South African online customers from three to 60 percent of the population.

MTN Mobile Money claims that the increase in uptake will also result in a drastic cut in online transactional costs.

payD uses the Authenticated Mobile Transaction (AMT) technology developed by MTN Mobile Money, which uses SIM and PIN technology to transform any mobile phone into a secure, encrypted point-of-sale terminal.

“A critical element to payD’s security, apart from the high levels of hardware-based encryption, is that the service will only work for the registered user via their personal mobile phone. So there need to be three elements simultaneously in place for the service to work: the debit card, the registered phone and the ATM PIN,” says Parratt.

“It is as secure as walking into your nearest shopping centre, but it works online,” he adds.

One of the first big corporate partners to join forces with payD is budget airline 1time.

Rodney James, CEO of the airline, says, “payD will make paying for 1time flights even easier. Although we have a wide customer base, not everyone has a credit card with which to purchase their tickets online. We have been looking for secure and convenient alternatives to the cumbersome EFT or bank deposit payment option for too long. payD fits the bill perfectly.”

In addition to 1time, there are some 80 other online merchants through which payD users will be able to make purchases.

The service is currently only available to users on the MTN and Vodacom networks with Nedbank and Stand Bank accounts.

It is expected, however, that other banks will come on board within the year.

No ad to show here.



Sign up to our newsletter to get the latest in digital insights. sign up

Welcome to Ventureburn

Sign up to our newsletter to get the latest in digital insights.

Exit mobile version