What is InterSwitch about? According to their website:
InterSwitch Limited is an electronic transaction switching and payment processing company with a business footprint that covers the provision of shared, integrated message broker solutions for financial transactions, e-commerce, telecoms value-added services and e-billing in the Nigerian environment.
Most of the local debit/ATM cards issued in Nigeria are linked to the InterSwitch network about 9 million cards. 23 out of the 25 banks in Nigeria linked to the InterSwitch network and issue InterSwitch-backed cards as well. One can thus understand the huge potential for any web merchant that accepts payment from InterSwitch cards, via the Internet. Nigeria has an official population of about 140 million and this shows that there is a big possibility that the number of InterSwitch cards will increase even further.
The product from InterSwitch that enables web merchants to accept payment online in real-time from InterSwitch cardholders is known as WebPay.
WebPAY is a secure internet payment gateway developed by InterSwitch to facilitate payments on the internet (across various banks) using debit cards issued by banks on the network. Currently only the Nigeria Debit Card and CashCard are supported. WebPAY provides the simplest and quickest method of integrating e-commerce websites to the InterSwitch payment platform.
WebPAY plugs-in seamlessly with existing websites and acts as abridge between a merchant’s website and financial institutions (banks) that process payment transactions.
Now, this is the problem: A merchant needs to cough out a whopping sum of N150,000 (about $1,250) to get the WebPay API for his/her website. Aside that, InterSwitch makes 1.5% on every transaction that passes through WebPay. In my opinion, no justification for the high entry fees. To the best of my knowledge, it is the only thing that has kept most web merchants away from InterSwitch. Simple economic principle: Lower your entry fees, have more merchants on your network, make more money from the transaction fees.
The closest competition to InterSwitch is Etranzact. Their entry fees is only marginally lower: about $1,050. Perhaps we need Visa and Mastercard to knock this folks to size.
GTpay which is GTBanks alternative to InterSwitch offers its services for N75,000 which is almost half of what InterSwitch charges its customers.
GTPay is Guaranty Trust Bank’s e-payment solution that enables merchants’ integration to multiple payment gateways in an easy and consistent manner. With this, merchants only need to write their ‘ePortal’ once, integrating with GTPay, and it handles communication with the supported payment gateways – that do the actual financial debit/credit of accounts.
GTPay actually rides on the InterSwitch platform so you find a lot of small web merchants using this option instead.
Are you a web merchant in Nigeria? What are your thoughts?