Ok so you’ve decided to give this “make money online” thing a shot. You’ve figured out what you are gong to sell, to whom and how. Now one last thing remains. How will you get paid? How will you receive the chapaa? There are two ways you can receive payments online:
1. Having your own merchant account
2. Using third party processors
What is a merchant account?
A merchant account is a special kind of bank account where funds received from credit card transactions are first routed to the special account and held there before being remitted to your business account. You as an online merchant will need an account called “Card Not Present Merchant Account”. Merchant accounts are only useful when you are receiving payments on your own website (Get one!!) and have some sort of payment processing system already in place on the website (basically, a shopping cart system.
Having the merchant account is, actually, the first step in processing credit cards online. You will also need a payment gateway. A payment gateway is a service provided by billing processor which allows real time authorization of online transactions.The payment gateway you choose to work with has to be compatible with your shopping cart. Three top payment Gateway providers are AuthorizeNet, Verisign and USAePay. All payment gateway providers have their own merchant solutions. Most banks, today, work with partner payment gateway providers and are fully capable of furnishing with a merchant solution.
If you are just starting an online business and you don’t think that your sales will generate more than a thousand dollars a month, you will be better off with a third party processor. However, once your sales become really high, you will save a bundle by switching to a merchant account.
PayPal
With 72 million accounts worldwide and payment volume which is growing at a rate of 44 percent each year, PayPal by far is the most popular third party processor on the Internet. PayPal is a simple and affordable payment solution for those online merchants who are unable to or don’t want to go through the complex process of setting up a bank merchant account. Merchant losses from fraud on PayPal are now only 0.17% of revenues, vs. 1.8% for online merchants that accept credit cards through merchant accounts. This gives one more reason to use PayPal.
Paypal is also perfect for receiving small payments. For example, if you are a freelance writer and you do sme small job, youu don’t need a big huge merchant account – just request to be paiid through Paypal. Once the money is in your Paypal account, you can use it to pay for things online, or you can request Paypal to send the money to you.
Getting a Paypal account in Kenya used to be impossible but they opened that up and you can get one right away. The bet way to use Paypal from Kenya is to use it in tandem with a Debit card. Basically, get a Debit card (I got mine from KCB) and then link it to your Paypal account – you will need to verify the card by entering into Paypal some code that will be on your bank statement. You will also need to verify your address by scanning and sending to Paypal a document (like a water of power bill) showing your name and address on the face. Doing these verifications may seem like a chore but, trust me, you will be love the simplicity and assurance that Paypal is known for.
ClickBank
Clickbank is a laaaarge marketplace where sellers list digital products for sale. The thing that’s special about clickbank is that hundreds of thousands of people ready to market and sell your product for you for a commission. By listing your product on clickbank, you access a huge market. For selling e-books, software and other similar digital products, ClickBank is probably your best option. ClickBank accepts all major credit cards and PayPal.
MPESA
Did you know that you can accept payments online through Safaricom’s MPESA service? Nice eh? I’m pretty new to it so I cannot really review it but here’s what you need to do if you want to accept payments online via MPESA:
- Send an email to mpesa@safaricom.co.ke requesting for the service
- Safaricom then responds with the requirements, tarrifs and supporting Docs required.
- Agreements and contract drafted
- Allocation of code number, account creation
- Service Goes live
There are many other third party processing companies available on the Internet. Two of them worth mentioning are moneybookers and ikobo.
Hi, is it possible to receive money with pay pal from Kenya or any other African country, i think the last time i checked this online payment stuff, one could only send money and not receive especially if you are using a local account, and if so will pay pal channel the cash to your local account upon request? or will the money have a limit of only purchasing goods/services online i. e from ones merchant account.
Regards Titus
Hi Titus. Thanks for stopping by. You’re right, money in your paypal account cant (yet?) be withdrawn directly to Kenya. Currently when I need to get cold hard cash off paypal I use it through my getafreelancer (www.getafreelancer / GAF) account where you can wire money to Kenya, or get a GAF Debit card that is acceptable wherever Mastercard is accepted (in Kenyan shops).
It’s tough working from Kenya though – a while back we couldn’t even get Paypal accounts here. But it’s getting better, one hopes.
How do you cope?
Thanks Kelvin, I accept payments through Mpesa and cheques /cash and this limits the boundary of my business, it’s also a challenge to ecommerce development.
Please expound on how I can get the hard cash, what are the requirements.
Regards
Titus
Give me a few hours and I’ll come up with a working, hopefully permanent, solution.
Titus, I’m still on this. I’ll get back to you with a comprehensive answer as well as creative work-arounds
Ok, will appreciate that.
Here you go: http://likechapaa.com/2009/07/receiving-online-payments-in-kenya/
I hope you find it useful
if i read clearly its only kcb debit card that go in tandem with the the paypal?
what if i dont have my own water and electricity bills can i fake the the bill using my name??
It’s not nice to fake
How about using a letter from school, or a transcript? As long as it has your name and address and looks official.
Also, KCB’s card is the easiest but any Msstercard/Visa card should work.
Making money online is great
It sure is! How do you make your money?
Mpesa is available in the Uk.Go to http://www.kentv.net and look for mpesa icon and you are in.
Wow this is great eh? Spreading Kenyan products
Gr8ful to find out gud infor about receiving payments online,thanks
You’re welcome, thanks for visiting.
Hi, am currently trying to venture into online moneymaking jobs. Any suggestions on which sites I shld go to and what kinds of jobs are available?
Thanks,
Aaron.
Have a look at this, friend: http://likechapaa.com/2009/11/online-data-entry-jobs