PayPal is one of the most widely used payment systems in the world, with millions of users. Do you want to learn how to use PayPal in South Africa? Or, to put it another way, how does PayPal function in South Africa? We’ll look at how to set up a PayPal account and utilize it to collect payments online in South Africa in this article.
Paypal is a payment method that is accepted in South Africa. PayPal is the world’s most popular payment service, with millions of customers and businesses relying on it. It’s a fantastic way to accept payments for your online store or business. But, in South Africa, how does PayPal work? There are a number of details to consider, such as the currencies that can be received and how to withdraw your funds. PayPal is not as straightforward to use in South Africa as it is in other countries, but it is still an excellent option to receive payments from foreign clients.
You don’t have time to read everything? Here’s a quick rundown. You only need to open a PayPal account, validate it, and link it to your South African bank account to use PayPal in South Africa. In terms of costs, PayPal transaction fees in South Africa range between 5% and 8% for each transaction. As a result, PayPal is a pricey option. However, unlike most local South African payment systems, PayPal allows you to receive foreign currencies such as USD or Euros.
Is PayPal Available In South Africa?
PayPal is available in South Africa, which is great news. PayPal allows you to send and receive payments for goods and services via the internet. However, due to South African rules, there are some limitations to utilizing PayPal in South Africa.
To begin with, payments in South African Rand are not feasible. However, you will be able to take international payments in any of PayPal’s 25 currencies, including USD and Euros. PayPal is a wonderful option to collect payments from international customers that don’t want to pay in Rand because of this. Customers in South Africa, however, will find this inconvenient.
The second major limitation is that funds in your PayPal account cannot be kept. You also won’t be able to use your PayPal funds to make straight internet transactions. Instead, your PayPal balance must be withdrawn to your South African bank account within 30 days.
While this may appear inconvenient, PayPal’s use in South Africa should not be overlooked. PayPal does, in fact, provide numerous advantages.
Benefits of PayPal
First, PayPal is used by hundreds of thousands of websites around the world. It is well-known and trusted by customers. PayPal is also popular in North America and Europe, and allows you to receive payments in 25 currencies. This means that if you plan to sell to international customers in their local currency, PayPal is a great option.
Then, PayPal also offers buyer and seller protection against fraudulent transactions. This protects your customers and yourself from fraud and payment issues.
Another advantage is that when clients make payments, PayPal handles all of the payment details and data. They keep this information safe, so you may go about your business knowing that your data and that of your clients is protected.
Finally, when customers buy from you, a well-known payment option such as PayPal creates trust. When they’re deciding whether or not to buy from you, this can be a huge differentiation.
How does PayPal work in South Africa?
Let’s look at what you’ll need to do in practice to set up PayPal to accept payments in South Africa. To use PayPal in South Africa, you must first:
Let’s take a closer look at each of these stages and learn how PayPal works in South Africa.
Step-By-Step Process to Setup your PayPal Account
1. Create a PayPal account.
You must first open a PayPal account in South Africa in order to receive payments via PayPal. Create a PayPal account at http://www.paypal.com/za.
An individual or a company account is available. This decision is made based on how you plan to use your account and whether you are working as an individual or as part of a company.
You must validate your account after it has been established. To do so, you must provide PayPal some proof of identity documents. The following are common examples:
- a duplicate of your national identification card (or of your Passport for foreign citizens)
- A utility bill or bank statement can be used as proof of address.
- a copy of your bank statement to double-check your personal banking information
You must also add a credit/debit card to your PayPal account in order to verify it. This is done in your PayPal account’s “Add/Edit credit card” screen. Fill in the essential information, including your name, credit card information, and billing address. PayPal will charge a small amount to your card to verify it after you confirm these facts. They will instantly return it a few days later.
PayPal will mark your account as “Verified” once your documents have been validated.
2. Link your PayPal account to your bank account
The final step in receiving payments is to link your PayPal account to your South African bank account when it has been validated. You will be able to withdraw money from PayPal in South Africa once this is completed.
To withdraw your funds, you can link an account with any South African bank. Even if you do not bank with FNB, the withdrawal process in South Africa needs you to create an FNB online profile. Indeed, PayPal has been working with FNB to handle transactions since 2010.
The FNB Withdraw Service allows you to transfer monies from your PayPal account to your FNB or any other South African bank account linked to your PayPal account. If you don’t have a FNB account, you can open one for free online and link your PayPal account to your South African bank account.
To do so, go to the FNB website and register for the FNB PayPal Service. Then it’s just a question of setting up your FNB online profile and filling out a few documents to link PayPal to FNB.
This method allows you to withdraw money from any bank account in South Africa. You can still withdraw monies to your existing account if you bank with ABSA, Capitec Bank, Standard Bank, Nedbank, or any other bank. FNB processes and sends money to your associated bank account when you withdraw money from your PayPal account. The withdrawal is transferred directly to your FNB account if you bank with FNB.
3. Withdraw your funds
As previously stated, it is not feasible to withdraw funds straight from your PayPal account due to South African rules. It is not possible to utilize your PayPal funds to make online purchases or to send money to other PayPal users.
Instead, you’ll have 30 days to withdraw the funds to your South African bank account after they arrive in your account. You can use them whatever you like once they’ve arrived in your bank account.
That’s all there is to it! In South Africa, you’re now ready to utilize PayPal.
PayPal Fees in South Africa
We’ve now gone over the advantages of PayPal and walked you through the setup process. Last but not least, be careful of PayPal fees in South Africa.
You won’t have to worry about any setup or monthly fees because the PayPal costs don’t cover them. You must, however, be prepared for the following:
- A fixed transaction fee of 2.4 percent to 3.9 percent, plus $0.3USD each transaction, is charged by PayPal.
- PayPal additionally adds a 2.5 percent currency conversion fee on top of the current exchange rate. FNB determines the exchange rate. It also usually includes a FNB-imposed margin above the market rate.
- Finally, FNB imposes a withdrawal fee ranging from 0.81 percent to 1.51%. The percentage is determined by the amount of the transaction.
The following table summarizes the PayPal fees in South Africa:
|PayPal fee||2.4% to 3.9% + $0.3 per transaction|
|Currency conversion fee||2.5%|
|Exchange rate||Decided by FNB|
|FNB withdrawal fee||0.81% to 1.51%|
|Total||5.71% to 7.91% + $0.3 per transaction|
PayPal is expensive to use in South Africa, with fees ranging from 5.7 percent to 8%.
Do the advantages of using a globally recognized payment brand offset the costs of doing so? Do the advantages of a system that can help you expand your consumer base and reach abroad outweigh the costs? In the end, it will come down to personal preference and the needs of your company.
Most Commonly Asked Questions
Can I use PayPal in South Africa?
Yes, you can use PayPal in South Africa, in a nutshell. All you have to do now is create a PayPal account, validate it, and link it to your South African bank account. It takes a few steps and the PayPal cost for receiving funds isn’t cheap, but it works!
What is the procedure for opening a PayPal account in South Africa?
To create a PayPal account in South Africa, simply go to the PayPal website and fill out the form. Then, by submitting the relevant papers and adding a credit or debit card, you can authenticate your PayPal account. After that, you’ll be able to utilize your PayPal account to make and receive online payments.
In South Africa, how do I receive money through PayPal?
You can withdraw money from any bank account in South Africa once someone has sent you a PayPal payment. To withdraw your funds, you must use the FNB ‘Withdraw Service with PayPal’ due to rules and the relationship between PayPal and FNB. After that, your cash will be put into a bank account of your choice. Withdrawals from PayPal to your bank account take 3 to 5 business days to process.
Which South African banks are PayPal partners?
PayPal funds can be withdrawn to any South African bank account. Standard Bank, Nedbank, ABSA, and all other South African banks are included. The sole need for making a withdrawal is that you link your South African bank account to PayPal, as detailed here.
Creating a successful online shop entails a number of processes, including identifying the proper goods to offer and establishing an online identity. But none of this matters if you don’t have a secure payment method in place for when you start selling.
PayPal isn’t the cheapest option in South Africa, but it has a lot of advantages. Using a world-class payment platform improves the trustworthiness and credibility of your online store. It also allows you to sell to international consumers in their own currency, which is a huge benefit or even a requirement.
If you still need to consider your alternatives, read our summaries of the best payment gateways in South Africa.