Payment gateways play a significant role in eCommerce worldwide, and eCommerce entrepreneurs and businesses can only operate effectively with payment gateways. This also applies to Pakistan, where many international payment providers have remained reluctant to provide their services. The reluctance is there for several reasons, including malicious practices by merchants and customers, lack of regulation, low-quality cyber security, and trade restrictions. Pakistani entrepreneurs and businesses need help with receiving and sending payments. With a smooth flow of funds, businesses and service companies can survive.
Let us look at some of the payment gateways available in Pakistan and answer some basic questions.
Payment gateways provide “merchant services” such as debit/credit card payments to both offline (brick & mortar) and online (online retailers, service providers) businesses. These merchant services include credit/debit card devices and other points of sale. Payment gateways facilitate transactions by transferring information between payment portals and the acquiring bank.
These gateways may or may not be directly involved in the money flow. Most of them are web servers connected to a merchant’s POS system. Payment gateways may connect several payment methods and acquire banks under one system.
When credit and debit cards were first introduced, there was no concept of third-party payment gateways. Banks themselves did the honours. They were already experts at handling transactions, so by identifying the point of sales and using IT/Telecom installations, banks became the payment gateways.
One such bank in Pakistan, which is not only a pioneer of Pakistani banking but also provides online payment services, is HBL. HBL has recently introduced an eCommerce checkout solution that enables eCommerce PSPs/PSOs/Aggregators/Merchants to accept payments online from their clients on their mobile apps and their websites. “eCommerce Checkout Solution” also offers apps and plugins for renowned eCommerce platforms such as Woocomerce and Magneto. The platform allows card-based payments (MasterCard, VISA, and PayPal Union Pay International), account-based payments (API-based services), and wallet-based payments.
UBL is one of Pakistan’s oldest banks and has a customer base of over 4 million. The bank has over 1400 branches and above 44,000 touchpoints. To facilitate eCommerce businesses, the bank has launched its online payment gateway services called the “Go-Green Internet Merchant Acquiring”.
MCB Bank Limited is one of the most popular and largest private-sector banks in Pakistan. It has over 1200 branches. The bank has issued over 2.5 million cards (smart, prepaid, credit, and debit cards) and has a merchant base of over 10,000. The bank has launched its payment gateway services under MCB eGate.
The company has its headquarters in NYC. The company employs over 1,200 people and is currently serving more than 4 million people in 21 brick & mortar offices worldwide. Payoneer had a value of more than $1 billion in 2019.
After realizing the potential of eCommerce and the need for payment solutions, the telecommunication sector stepped into providing money transfer facilities. Mobilink introduced JazzCash, a mobile phone money-transfer service which you can use almost anywhere in Pakistan.
Another leading FINCA in Pakistan is Telenor’s EasyPaisa. Telenor provides widespread coverage and has a considerable customer base.
Fonepay Payment Service Limited is of Nepalese origin. It is licensed by Nepal’s central bank and is categorized as a Payment System Operator.
Keenu has been providing wallet and payment integration to millions of customers and more than 7000 merchants worldwide.
The decision to choose a payment gateway should take into account the following factors:
Finding the right payment gateway can be challenging, especially in Pakistan.
As far as local businesses and service providers are concerned, they have countless options. However, real problems start to emerge when you try to go cross border. The most significant hurdle online Pakistani businesses face includes a lack of international payment providers and restrictions. There is a need for the Pakistani Government to start taking these issues seriously and do its part in creating international collaborations by providing security. For instance, PayPal does not operate in Pakistan because of problems with cyber and trade protection. Regulations are required to make sure that both merchants and customers are accountable. PayPal is absolutely necessary if a business wants to target markets like the USA and the UK.
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