I am assuming that you have already heard about Ecobank Web Acquiring System. If you haven’t, it is still cool — as by the end of this post you will be able to grasp what this system is and why I call it a game changer.
I thought of writing this blog post after receiving many questions regarding the system. In fact, Ecobank is the first bank to introduce the system in Malawi and we are the first to integrate it at Hashmar Shoppings.
We were also invited to demonstrate how the system works during the official launch which took place at Sunbird Mount Soche Hotel in Blantyre on May 3, 2018.
Thanks Lumbani Manda and the entire Ecobank team for the invitation.
So, to help you understand this system, consider the following scenario: You have an online shop, a restaurant, a hotel or any other business and you need to start accepting payments online. The first thing that comes into your mind is how you can collect those payments because you are not registered as a financial institution. But still more, you need to increase revenue and grow your business online. This is where now you need to think of solutions that can truly meet your needs and the needs of your customers. A solution that is more secure and user-friendly.
Web Acquiring happens to be one such solution. This involves entering a contract with a bank known as ‘Acquirer’ that will be responsible to handle and process your debit/credit card payments online.
The acquirer, also known as acquiring bank or merchant bank, is a bank or any other financial institution, licensed as a member of Card Association e.g. Visa or MasterCard, that creates and maintains your bank account. These financial institutions have to comply with the regulations and meet requirements of Card Association before they are approved to become an acquirer.
Ecobank is an approved financial institution that allows shop owners, travel agencies, hotels etc to receive their payments online in a convenient way. Ecobank follows security standards for fraud prevention. It is a Payment Card Industry Data Security Standard (PCI DSS) compliant. Therefore, you don’t need to worry about security or fraud.
Firstly, you need to have a business account with Ecobank. This is an account where the payments you receive online will be settled to. Then you need to submit an application to become a merchant of their Web acquiring system.
If you meet all the requirements, the bank then will create a merchant account for you and send you an API alongside necessary documents on how you can start to accept payments on your website.
Once you complete the integration, you will actually go a number of steps to test the system in sandbox or I should say trial mode to ensure the system works as required. If you pass all the necessary steps, Ecobank then gives you other credentials for live transactions.
The timeframe of the integration process varies from a few minutes to months or years depending on the level of knowledge of your developers. The good thing is that the Ecobank team is always there to help you get this done.
However, if you still get stuck, you can buy our plugins for Woocommerce, Magento, Prestashop which will allow you to integrate the system within few minutes. For our e-commerce clients, these plugins are provided for free.I should also mention to say, so far, we have a solution to every coding problem that one may face during this process.
After you have successfully integrated the system, a new payment gateway is added on your checkout/payment page.
For the online shops for example, when a customer chooses this payment option during the checkout process, the order details is sent to the payment processing link, where during the payment process, the acquirer (in this case Ecobank) authorizes card transactions and connects issuing banks (cardholders bank) on your behalf as a merchant.
Whenever a buyer uses a credit or debit card in a purchase, Ecobank either authorizes or rejects the transaction based on the data from the issuing bank and card network (like VISA or MasterCard).
In short, Ecobank receives the payment authorization request from your website and then sends it to the issuing bank for approval. If the purchase is approved, the funds are credited to your account. The approval by the issuing bank is instant while payment settlement to the merchant’s account is done within 24-48 hours maximum.
Also, depending on how you have configured your website, any response that will come from Ecobank as a payment processor, will be sent back to your website so that you can determine what to do next. E.g to cancel, hold or process the order.
Well, in short, I can say, when you use platforms like PayPal, Stripe etc when someone completes an order on your website, the money is not credited to your bank account directly. It goes to these institutions that, then process the payment and send you (normally via wire transfer).
You also need a bank account in countries like USA for you to be able to receive the payment, which is a non starter.
With Ecobank’s Web acquiring, when someone makes a payment, it goes directly to your account. You therefore need to have an account with them for you to be able to receive the funds directly.
However, your customers can make a payment using Visa debit/credit card or MasterCard issued by any other bank.
Ecobank doesn’t charge the customer but gets a commission from the merchant which can be negotiated with the bank. The more the transactions the less the commission will be. Ecobank also doesn’t charge merchants any setup fees.
However, if you are not a developer get prepared to pay setup fees to external developers who will create your website and setup this system for you.
If you are a Freelance Web Solutions client that shouldn’t be a big deal of course, because as I have mentioned above, we have plugins for almost all popular shopping carts that will make the integration process a breeze. Just send a call back request and we will be back to you with more details.
Lastly, I can say Ecobank’s Web acquiring system is a game changer. It has really revolutionized the ecommerce industry in Malawi and no doubt, it will complement to boost the country’s economy.
A big credit should also go to Reserve Bank of Malawi for approving this system. I just hope to see more of similar innovations from other local banks.