Top 10 List of Online Payment Gateways in Nigeria
Remember when cash was king in Nigeria? Before 2012, businesses relied mostly on cash transactions, making things slow and inconvenient. The Central Bank of Nigeria (CBN) saw the need for change and introduced the cashless policy to encourage digital payments. This paved the way for innovative solutions like the NIBSS Instant Payment (NIP) system.
The impact has been undeniable. Since its launch, NIP transaction value has skyrocketed, growing over 900% from ₦3.9 trillion in 2012 to a staggering ₦38.7 trillion in 2023. This surge in online payments has fueled the growth of Nigerian eCommerce, even surpassing the US in real-time payment volume in 2021!
But how do businesses handle all these online transactions? Enter payment gateways in Nigeria. These secure platforms act as bridges between your customers and your bank account, allowing you to accept various payment methods like cards, bank transfers, PoS, and even USSD.
This guide will delve deeper into the world of Nigerian payment gateways. We’ll explore your options, explain their benefits, and help you choose the perfect one for your business.
Best Online Payment Gateways in Nigeria 2024
Various payment gateways in Nigeria allow customers to make payments online. Some of the popular ones are:
What is a payment gateway
A payment gateway is a service that facilitates the transfer of payments or perhaps, electronic payments between a business and its customers. It can also be referred to as an interface that allows customers to pay for goods and services via multiple methods, channels, or both.
When someone makes a purchase or any transaction, they will be redirected to the payment gateway’s website where they will enter their personal and credit card information. After this information is verified, it will then be sent back to the business’s website and the transaction will be completed.
These companies process electronic transactions for different categories of businesses – eCommerce websites, corporate entities like schools, hotels, and hospitals, and smaller businesses like MSMEs/SMEs and online businesses on social media. Brick-and-mortar stores that typically use physical terminals with magnetic strips or chip readers to complete transactions offline now provide the online payment option. They also collaborate with financial institutions such as banks or credit card providers to ensure the secure and efficient transfer of funds between merchants and buyers.
How do I choose a payment gateway for my business?
This is exactly what this article is going to help you do. Although choosing a payment gateway can be tricky, this article will look at the essential criteria to examine before choosing one for your business and rank the top 10 payment gateways currently in the country that you can choose from. The criteria are commission per transaction, payment method or channels accepted, transaction success rate, payment settlement time, ease of onboarding and user-friendly interface.
After a clean sweep of the current payment gateway market in Nigeria, the following emerged as the top ten: Paystack, Flutterwave, RexPay, Interswitch, Voguepay, Monnify, Remita, Squad, DusuPay, and OPay
10 Best Payment Gateways in Nigeria:
1. Paystack:
Paystack, acquired by Stripe in a significant deal, is a leading payment gateway in Nigeria. It offers a high transaction success rate, quick settlement times, and diverse payment options, making it an excellent choice for businesses of all sizes.
Features
- Cost: No setup fees. 1.5% + ₦100 for local transactions, 3.9% + ₦100 for international transactions
- Transaction success rate: near 100% success rate
- Settlement time: The next day
- Payment options: card, bank account, USSD, PoS, Visa QR, mobile money, bank transfer, Apple Pay, Visa QR
- Security: Level 1 PCI-DSS compliant
- Recurrent billing: Available
More than 80,000 customers use Paystack to receive payments for their businesses. On its success rate page, the startup makes a bold claim; “If a transaction fails on Paystack, it’s highly unlikely it’ll work anywhere else.”
Signing up on Paystack is free. However, the startup charges 1.5% + ₦100 for local transactions and 3.9% + ₦100 for international transactions. Transactions under ₦2,500 do not attract the ₦100 fee, and customers do not pay more than ₦2,000 for local transactions. Merchants who process large transactions may also be eligible for discounts, while accredited educational institutions are charged a flat fee.
Settlement occurs the day after payments are made, so your cash flow is hardly affected. eCommerce entrepreneurs would love Paystack as it is integrated with some of the most popular eCommerce platforms, such as Magento, Wix, WooCommerce, Shopify, BigCommerce, and Drupal.
Merchants using Paystack can receive payments in five currencies, including the naira, USD, Ghanaian Cedis, Kenyan Shilling, and the Rand. There are also payment channels like cards, bank accounts, USSD, PoS, Visa QR, mobile money, and bank transfers. Customers also get virtual accounts and process recurrent payments.
2. SeerBit:
With a goal to become the preferred payment option for African businesses, SeerBit provides flexible settlement options and supports payments in multiple currencies, making it ideal for businesses with international customers.
Features
- Cost: No setup fees; 1.5% of local transactions, 3.8% of international transactions
- Transaction success rate: Not stated
- Settlement time: The next day
- Payment options: direct debit, bank transfer, PoS, USSD, bank account, card, mobile money
- Security: Level 1 PCI-DSS compliant
- Recurrent billing: Available
Merchants using SeerBit can receive payments in 13 currencies like GBP, CAD, and USD, so if you have international customers, SeerBit has you covered. There are no setup fees, but it charges 1.5% and 3.8% of the transaction fee for local and international transactions, respectively.
SeerBit provides merchants who don’t have websites or online stores payment links they can share with their customers. Merchants get a checkout page and can receive payments from various channels, including mobile money, bank transfer, PoS, USSD, bank account, and card. It also has integrations with WooCommerce, Magento, and Wix. Like Paystack, its transaction settlement time is one day. Businesses can also offer payment options and digital banking solutions using SeerBit’s white-label solution.
3. Flutterwave:
A unicorn in the fintech space, Flutterwave caters to over one million businesses across Africa. With its presence in 11 countries and support for over 20 currencies, it is an excellent choice for businesses looking to expand regionally.
Features
- Cost: 1.4% for local transactions, 3.8% for international transactions
- Transaction success rate: N/A
- Settlement time: 24 hours
- Payment options: Bank transfer, bank account, mobile money, PoS, Visa QR, card, etc
- Security: PA DSS & PCI DSS Compliant
- Recurrent billing: Only on card payments
Flutterwave is present in 11 countries and enables merchants to accept payments in over 20 currencies. It allows payments through bank transfers, bank accounts, mobile money, PoS, Visa QR, and card.
Flutterwave’s customers are given a payment link that allows merchants to receive payments online without a website. However, they can create an online store to make it easier to do so. eCommerce businesses also get Shopify, Joomla, WooCommerce, PrestaShop, and Ecwid integration.
Transactions are also settled within 24 hours. Local transactions using cards, wallets, or mobile money are charged a 1.4% fee. In comparison, international transactions are charged 3.8% of their transaction value.
4. Monnify:
Backed by Moniepoint, one of Nigeria’s largest fintech startups, Monnify offers attractive pricing and various payment options, making it suitable for businesses within the country.
Features
- Cost: 1.5%
- Transaction success rate: Not stated
- Settlement time: The next day
- Payment options: USSD, card, Internet transfer
- Security: PCI DSS compliant
- Recurrent billing: N/A
Monnify gives its customers flexible settlement options. While it typically sorts out payments in 24 hours, users can be settled daily, twice daily, or instantly. Currently, it only processes payments for customers within Nigeria, where it provides a checkout option and virtual accounts.
Monnify says its attractive pricing is possible because it owns a switching licence. Account transfers incur a 1% transaction fee capped at ₦1,000 per transaction. Card transactions attract a 1.5% transaction fee capped at ₦2,000 per transaction. Merchants can receive offline payments when they use Moniepoint’s PoS terminals.
5. Remita:
Known for its association with public universities in Nigeria, Remita supports various payment methods and provides access to financial data, making it suitable for businesses requiring detailed financial insights.
Features
- Cost: 2% fee capped at ₦2,500; foreign cards attract an extra 2% charge
- Transaction success rate: N/A
- Settlement time: The next day
- Payment options: USSD transactions, debit/credit cards, PoS terminals, bank transfers
- Security: N/A
- Recurrent billing: Available
Merchants using Remita can receive payments from many sources, such as USSD transactions, debit/credit cards, PoS terminals, and bank transfers. Customers also get access to their financial data, providing them with a clear understanding of their business’ finances.
Like all the options on the list, setting up an account comes at no cost to the user, but transactions attract a 2% fee capped at ₦2,500; foreign cards attract an extra 2% charge. Remita also supports eCommerce sites like WooCommerce, Wix, Magento, and OpenCart. Merchants can receive same-day payments, but card transactions are settled the next day.
6. Interswitch:
A pioneer in Nigeria’s financial services space, Interswitch offers competitive pricing and supports multiple payment options, making it a reliable choice for businesses looking for a long-established payment gateway.
Features
- Cost: 1.5% for local transactions (capped at ₦2,000), 3.8% for international transactions
- Transaction success rate: N/A
- Settlement time: The next day
- Payment options: USSD, card, bank transfer, QR code
- Security: PCI DSS compliant
- Recurrent billing: Available
As one of the oldest fintech players in the country, Interswitch is used by businesses such as Dominos and BetKing. You don’t pay a fee to set up an account with Interswitch. Local transactions, however, attract a 1.5% fee capped at ₦2,000. Where most competitors say this transaction fee excludes VAT, Interswitch’s is VAT-inclusive.
You can also receive international payments at a 3.8% VAT-exclusive fee. Settlement, which happens the next day, is done in naira regardless of where the payment was made. Its APIs can be integrated into websites and mobile apps. Users without a website can use its payment link feature to accept payments. If your business requires that you accept recurring payments, you can do that using Interswitch.
7. DPO Group:
With a vast presence in 23 African and Middle Eastern countries, DPO Group is an excellent choice for businesses targeting customers in these regions. Its dynamic currency conversion provides familiarity to users during payments.
Features
- Cost: N/A
- Transaction success rate: N/A
- Settlement time: 24 hours (real-time for some users)
- Payment options: Mobile money, USSD, QR code
- Security: PCI DSS compliant
- Recurrent billing: Available
One of DPO’s biggest features is its presence in 23 countries across Africa and the Middle East. This solves the payment challenges for merchants wishing to sell their services to people in these regions.
Besides being able to pay in their local currencies, DPO’s dynamic currency conversion shows users a familiar currency when making payments. Your customers can also pay you whether you have a website or not using DPO’s payment links. DPO once charged a setup fee, which has since been stopped.
DPO is integrated into popular eCommerce websites like PrestaShop, Shopify, Wix, WooCommerce, and Magento. You can also integrate the DPO API for payments if you have a mobile or web application. Settlement on DPO takes place within 24 hours. However, users in Kenya and Tanzania can get real-time settlement using the DPO card. Hopefully, it will be opened to other users soon.
8. Squad:
A new entrant to the payments market, Squad offers transparent pricing and diverse payment options. While it operates solely in Nigeria, it caters to various transaction types.
Features
- Cost: 0.1% for virtual accounts, 1% for USSD and payment links, 3.5% for international payments using a payment link, and 0.25% for SquadPOS transactions.
- Transaction success rate: N/A
- Settlement time: The next day
- Payment options: cards, transfers, USSD
- Security: PCI DSS compliant
- Recurrent billing: Available
Squad does not charge a setup fee and does not have a unique transaction fee for all payment methods. For example, while it charges 0.1% of the transaction for virtual accounts, it charges 1% for USSD and payment links. International payments using a payment link attract a 3.5% charge per transaction. Payments made using SquadPOS also attract a 0.25% fee per transaction. Merchants receive payments within 24 hours of their completion. However, Squad is only present in Nigeria. It does not support recurrent billing, which could be a problem for businesses that need recurrent payments.
9. RexPay:
Accelerex is a leading fintech company in Africa and is the parent company of RexPay, its online payment gateway product.
RexPay provides a seamless payment service to merchants that can be integrated into their preferred application (Web/Mobile) and enables them to receive online payment from customers. It facilitates real-time debits from cardholder’s accounts and onward credits to the merchants’ accounts. RexPay supports multiple payment channels (cards, accounts, transfers (Internet Banking), USSD, or QR Code) and the processing of payment across major payment schemes and card brands in Nigeria such as Verve, Mastercard, and VISA.
This integration ensures a smooth payment experience for both merchants and customers.
RexPay provides an intuitive portal that enables merchants to monitor and manage transactions, refunds, settlements, disputes, and more in real-time. Merchants can also generate and download various reports and analytics to track performance and gain valuable insights. RexPay employs advanced technologies and algorithms to detect and prevent fraudulent activities, ensuring compliance with regulatory standards.
Moreover, RexPay allows merchants to create and share payment links with customers via email, SMS, and social media, enabling payments without the need for a website or app.
With RexPay, merchants can sign up easily on the platform, and then begin to receive payments from their customers. Signing up for an account on RexPay is free, and customers won’t be charged any maintenance fees.
- Cost: free setup
- Transaction commission: 1.5% capped at N2,000 for local businesses
- Transaction success rate: 100%
- Settlement time: The next day
- Payment options: Bank transfer, bank account, mobile money, Visa, Mastercard, Verve, QR Code, payment links, etc.
- Security: PA DSS & PCI DSS Compliant
10. DusuPay
Dusupay is an African payment provider that provides incredibly secure, efficient, and quick infrastructure for businesses to use. The payment gateway is free to set up, supporting merchants with up to 5,000 customers. They also have the option of being able to accept Visa, Mastercard, and Verve for their users.
DusuPay offers one-time and recurring payments to merchants. One-time payment processing is similar to the traditional gateway. However, recurring payments are processed with this company’s own technology.
Their pricing plan, however, differs from the rest of the payment gateways out there. They’ve been trusted by hundreds of multi-million-dollar companies with B2B customers for a long time.
- Cost: No setup fee
- Transaction commission: Card – 4.9%, Bank – 3.5%
- Transaction success rate: Not stated
- Settlement time: Within 1 day
- Payment options: Rupay, Visa, MasterCard, Amex, JCB, Maestro, PayD and many more
- Security: PCI DSS compliant
11. Opay
OPay is a mobile payment platform that has expanded its services to include ride-hailing, food delivery, and other on-demand services. It has gained prominence as a super app, providing users with multiple functionalities, including payments, making it a convenient choice for those seeking an all-in-one solution.
OPay payment gateway is the latest payment gateway in Nigeria for developers to accept payments on their websites or apps. The platform offers various features, including fraud prevention, two-factor authentication, automatic chargeback prevention, HIPAA compliance, and more.
OPay is not limited to being just an e-commerce gateway but also offers support for different types of businesses like restaurants, digital agencies, and online retailers. Its customers can choose to pay from their cards, use QR payments, or with their OPay Wallet.
- Cost: No setup cost
- Transaction commission: N/A
- Transaction success rate: N100%
- Settlement time: Within a day
- Payment options: USSD transactions, debit/credit cards, PoS terminals, bank transfers
- Security: PCI DSS compliant
The Checkout payment solution is a convenient alternative to traditional card or cash payments.
Why are payment gateways important for businesses in Nigeria?
Payment gateways are crucial for businesses in Nigeria due to several reasons:
a. Digital Transformation: With the rise of digital transactions, businesses need reliable payment gateways to facilitate seamless and secure online payments. Payment gateways allow businesses to adapt to the digital age and provide their customers with convenient payment options.
b. Increased Sales: Offering multiple payment methods through payment gateways improves the customer experience, leading to higher conversion rates and increased sales. Customers are more likely to complete purchases when they have various payment options to choose from.
c. Cash Flow Management: Payment gateways ensure swift and efficient settlement of transactions, enabling businesses to manage their cash flow effectively. Quick settlement times help businesses access funds faster, improving liquidity.
d. Security and Trust: Payment gateways implement robust security measures to protect sensitive customer information, enhancing trust between businesses and their customers. Security compliance, such as PCI-DSS, ensures that payment data is handled securely.
e. Reach and Expansion: With the growth of eCommerce in Nigeria, businesses need payment gateways to reach customers beyond their physical locations. Payment gateways allow businesses to cater to customers from different regions and even international markets.
How do payment gateways contribute to the growth of eCommerce in Nigeria?
Payment gateways play a vital role in the growth of eCommerce in Nigeria:
a. Improved User Experience: Payment gateways enable smooth and hassle-free transactions, enhancing the overall shopping experience for customers. A positive user experience encourages repeat purchases and fosters customer loyalty.
b. Increased Sales and Conversions: With secure and convenient payment options, payment gateways reduce cart abandonment rates, leading to increased conversions and higher sales for eCommerce businesses.
c. Access to a Wider Customer Base: Payment gateways support multiple currencies and payment channels, allowing eCommerce businesses to cater to both local and international customers. This broadens the customer base and boosts revenue potential.
d. Seamless Integration: Payment gateways integrate easily with eCommerce platforms, streamlining the checkout process for customers. This integration also simplifies backend processes for businesses, reducing administrative tasks.
e. Data Insights: Payment gateways often provide detailed transaction data and analytics, giving eCommerce businesses valuable insights into customer behavior and preferences. These insights can be used to optimize marketing strategies and product offerings.
What challenges might businesses face when selecting a payment gateway in Nigeria?
Selecting the right payment gateway can pose challenges for businesses in Nigeria:
a. Cost and Pricing Complexity: Understanding the pricing structure of different payment gateways can be complex. Businesses need to carefully evaluate transaction fees, setup costs, and other charges to choose an affordable option that aligns with their budget.
b. Transaction Success Rates: Obtaining accurate data on the transaction success rates of payment gateways may be challenging. Relying solely on service providers’ claims may not provide a complete picture, making it crucial to seek customer feedback and reviews.
c. Limited International Support: Some payment gateways may not support international transactions or offer limited currency options. This can be a drawback for businesses with global aspirations.
d. Security Concerns: Security is a paramount concern for online transactions. Businesses must ensure that the selected payment gateway complies with industry standards and provides robust security features.
e. Recurrent Billing: Businesses with subscription-based models may face challenges finding payment gateways that support recurrent billing, making it essential to check for this feature in the options available.
Conclusion:
payment gateways play a vital role in Nigeria’s business landscape, especially in the context of eCommerce growth. Businesses must carefully consider factors like cost, transaction success rates, settlement times, payment options, security, and recurrent billing when selecting the right payment gateway for their needs.
By making informed choices, businesses can optimize their payment processes, enhance customer satisfaction, and drive growth in the digital economy.
