Are you a newbie online Entrepreneur having no clue how to get payments for your online business activities? If you are getting confused with terms such as Merchant Account, Payment Gateway, Third Party Payment Processor and wondering what that has to do with collection of payment for goods and services you render, this post is meant to help you. For well established online entrepreneur, you may find some useful tips in addition to what you already know.
I often receive emails from my readers (especially those from Nigeria) asking for help on how to open a PayPal account or a US bank account. Reading through some of the requests, it is obvious that those asking for help do not even fully understand what their needs are and as such often ask for solution that does not fit their need. So, I will start with a little explanation on what an online entrepreneur requires to collect payment online and then make suggestions on how even a Nigerian Entrepreneur can collect payment online.
Collecting Payment Online
Once you offer products or service for sale online, it is important that you have in place an easy way that your would be customer can pay you for such product or service. However, the system of receiving payment online will largely depend on the kind of customers you deal with and the kind of product/service you offer. Let’s look at some practical examples.
- My web hosting company NAIRAHOST is owned by a Nigerian and I pay for their services with local currency (Nigerian Naira), by using the banking facility provided in Nigeria. It is smooth and convenient for me. However, their customers outside Nigeria pay with dollars using Credit Cards or PayPal.
- Of recent, I bought a Toshiba Laptop from BestBuy. The payment was made using a US bank issued Credit Card (this was done on my behalf by a friend).
- Last week, I paid for a heavy industrial equipment worth several thousands of dollars. Even though the company is online, payment was made via secure Bank Telex Transfer because the amount involved was huge.
From this simple examples, you can see that one payment option may not fit all situations. The nature of your business activities plays a major role in determining what Payment Option your customer will consider suitable. So the first question to ask is; How do my customers want to pay? While there are several payment options such as:
- Paper Cheque – A paper cheque is written and mailed to you. Not the most convenient or timely option.
- Wire Transfer (Bank Telex Transfer) – Most suitable for huge amount of money. e.g local bank to a foreign correspondent bank.
- Credit Cards – Most suitable for any amount of money. eg. MasterCard, VisaCard
- E-Payments – Highly convenient for small amount of money. eg. E-Gold
I only listed the various options, but time will only permit us to look at just one. So, I will focus on the most common option, being credit card payment.
Credit Card Payments
Statistics have it that 90% of all online sales get settled through credit cards. So if the customers want to pay with their credit cards, you must put in place a facility for accepting credit card. It is a fact that for you to do business with consumers in the developed countries, your online business must be able to accept credit cards as a form of payment. To accept Credit Card payments, you will need to obtain either a personal merchant account or use the service of a third party processor.
What is a merchant account?
This is a special account provided by a bank or financial institution that enables an entrepreneur accept customer Credit Cards and other electronic payments via an e-commerce website. Simply put, it is a special kind of bank account. The process of getting a merchant account can be simple or rigorous depending on the kind of business activity the entrepreneur is carrying out online.
Third Party Credit Card Processors
If your business is small and your monthly turnover is less than five thousand, you may not need to bother about getting a personal merchant account. You can actually start collecting payment online by using the service of a third party Credit Card Processor. When the business turnover grows, you can then obtain your own merchant account. Let look at examples of affordable Third Party Credit Card Processors you can use.
PayPal
This is the most famous of them all. PayPal is a simple and affordable payment solution for new online entrepreneurs. It safes you the high cost and stress often associated with getting a merchant account. Also, PayPal offers different solutions to Online Entrepreneurs. We will take a look at three of them.
- PayPal Website Payments Standard: Your customers are afforded the option of payment with Credit Cards or Paypal. The transaction is processed on PayPal secure server.
- PayPal Website Payments Pro: Almost the same with above, but the customer does not leave your website at any time. It is quite similar to having your own merchant account.
- PayPal Email Payments: This is the most common one. You simply open an account with PayPal and request your customers to pay you using your PayPal account details. This is sufficient for small online businesses who receives payments that are less than a thousand dollars per transaction. However, it is advisable and financially wise to upgrade to either of the two options mentioned earlier as soon as possible.
Advantages of using PayPal: PayPal is about the most popular payment options available online today. It is easy to open an account and the processing of transactions is quite fast. Also, a great number of consumers from the developed nations use PayPal.
Disadvantages of using PayPal: PayPal is not available to entrepreneurs residing in some countries, for example Nigerian Entrepreneurs residing in Nigeria are not allowed to open a PayPal account from Nigeria. Beside this, many former users of PayPal claim that your account can get frozen for a number of reasons and you stand to loose whatever amount of money you have in the account. This can be scary for an entrepreneur. Before choosing PayPal it is advisable that you read reviews on websites such as www.PayPalSucks.com
Note: I am neither promoting nor discrediting PayPal. I use it but cautiously. Also note that the account I use was NOT opened from Nigeria (don’t fall prey to scammers who promise to open PayPal for you in Nigeria. A quick trip to PayPal.com will show you that Nigerians are not accepted for now. If you use a dubious way to open as a Nigerian Entrepreneur who is residing in Nigeria, you stand a higher risk of getting your account frozen).
AlertPay
AlertPay is an online payment service similar to PayPal. It provides individuals and businesses the ability to send and receive payments online without exposing their personal or financial information. The service is being provided by a Canadian privately owned and managed company founded in 2004. It is a rapidly growing leader in online payments. AlertPay offers several options:
AlertPay Personal Accounts
- Personal Pro Account: If you want to sell something online and you need to get paid in a hurry the Personal Pro Account is the way to go. It gives you the flexibility to send and receive payments and do business using your name. You can open a free account in less than 5minutes by clicking here.
- Personal Starter Account: If you are skeptical or not sure of where to start, use this option. The Personal Starter account is the ideal account to shop online safely without exposing your financial or personal information. It affords you the opportunity to get cash from your friends and family or send payments online for FREE.
Advantages of opening an AlertPay Personal Account:
1. No cost to send or receive payments
2. Accept numerous payments options.
3. Access to AlertPay Business Tools
4. Free for shoppers
5. Shop online without exposing your financial details.
6. Highly Secure.
AlertPay Business Account
If you own a business and you operate it using a unique business name different from your personal name, then an AlertPay Business account will be a good choice. It is tailored to meet all the needs of your online business. You will have access to numerous online business tools that will help your business grow online.
Advantages of opening an AlertPay Business Account:
• Conduct business under your company name
• Low transaction fees per transaction
• Accept Credit Card payments
• Sub accounts: Manage multiple online businesses with one account
• Website Payments: Buy Now Buttons, Subscriptions and Recurring Payments
• Business Tools: Integrate AlertPay into 3rd party applications
• Mass Pay: Send out payments to groups of people
Naturally, I love AlertPay because they allow online entrepreneurs from all over the world to open an account, Nigerians inclusive.
Note: I maintain an account with AlertPay and participate in their referral program.
There are other third party payment processors like 2Checkout.com, moneybooker.com, ikobo.com etc. But time and space will not permit that I talk about them now. Maybe I will discuss some of them in future post. Wishing you success in your online ventures. See you at the top. Cheers.
Update: Please note that AlertPay was bought over by Payza in March, 2012. Payza offer the same service AlertPay was offering and much more.
Great post,this post tell it all as it is.Alertpay any day.Check payment is also good if you don’t have any other source of getting out your payment.
How have you been?You’ve not been very much around, hope no problem.
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how do you pay by egold or 2checkout in naija?can you pay for hosting that way?
@Bola
There is no problem. I’ve been having some good challenges offline. Increase in responsibility in my place of work. I am enjoying it anyway. Thanks for checking on my. You make me feel cared for. Shalom.
@naijagal
I think http://www.NairaHost.com accepts e-gold. I will check it out and revert back to you. Thanks for visiting.
Thankyou for your post.it an eye opening article.Paypal is the best online payment proccessor but they are not accepting Nigerians.I have heard of this Alertpay and their credibilty.Maybe,I will jion them soon.moneybookers are the most wicked,they accuse Nigeria of terrorism-I hates them.Weldone Man.
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I got info about alertpay.some guys wanted to dupe me.they wanted to open paypal for me for 50,000.after i heard it’s no longer open for nigeria.everyone should beware.i will register with alertpay.thanks that was a nice post.
Hello Ayo I saw ur msg.I want u to help me out cos i aslo want to open my alertpay account but i dont know how to help myself out. Thanks
got ur info about paypal and alert.Hw can I access alert
Thanx 4 dis article.it really was an eye opener 4 me.I
had tried to use Paypal but realised they weren’t accepting nigerians.God bless you for your efforts good job.
@Seun and holla
Simply click on the Alertpay Banner or link. It will take you to the site. Registration is quite straight forward.
@Emmanuel
Thanks for the compliment. Cheers.
i want to secure an online job an before i can do that i need a means in which i could be paid my cash and i guessed the best way for me in Nigeria is to get a secured online credit card and i do not know how to go it for free ofcourse because of fradstars and if i eventually open how do i get my cash. thanks and God bless you
i applyed for a job online and for me to get paid is difficult i am a Nigerian student and i want to get a secured online credit card i do not know how to get it for free because i do not even have money to pay in the first place e-gold accont is tempoarly suspended and i need to know how i wll get my money if i open the account eventually. thanks and God bless you
@Oyin
I already sent you an email detailing the steps you should take. Basically, Alertpay will help.
@Oyindasade
Ask the employer if they can pay to ALERTPAY. If they agree to do that, then you can simply open an free ALERTPAY account and start receiving your payment.
You can transfer money from your ALERTPAY account to any domiciliary bank account in Nigeria. Hope this clarifies the issue. Cheers 😉
hi,
if alertpay can be opened by nigerians, does this mean that nigerians with dom accounts or mastercaeds can then make payments online?
I amased outside nija and looking at starting an online business in nija, cant afford webpay right now but also want to give my clients alternatives to going to the bankto pay for my products dat would mst likely be stated inusd or naira. pls advice by mailing me thanks
[…] online. Paypal is the most famous, but there are alternatives. You can get more details on how to receive payment online from my previous post on the topic, click the link How to receive payment […]
I live in Nigeria and I just opened an Alertpay account. Please tell me the details of how I can transfer money from my ALERTPAY account to my domiciliary bank account in Nigeria. Thanks.
@raph
I already answered your question in a comment above.
You can transfer money from your AlertPay account to a domiciliary account here in Nigeria. I guess I will do a post to give details. Thanks for visiting.
[…] wrote about AlertPay sometime ago in a post titled How to receive Payment Online. AlertPay, which is a Canadian Online Payment Processing Company, is a competitor to the widely […]
Hello, pls i live at Nigeria, i opened an alertpay account sometime last year but i was told to get it verified,before i can start using it.Pls can u tell me the quickest way to get my alertpay account verified? Thanks.
Honestly, this post is very frank, sincere and straight to the point. This is my first time of visiting this site, I stumbled on it through google search. keep up the good work
u are doing a good job, keep it up.
Very good presentation. I just want to add a little more info. We have not talked about our local payment processors – Interswitch, Etranzact, valuecard. Also for small internet businesses there is netnaira – a mico payment processor in naira.
I won’t advise nigerians to open paypal account.Alartpay is better for Nigerians
i am new hear and i really love this site but please sir can u pls tell me how to convert my online check recieved from my oline biz to naira.i have a dormicillary accounty with gtb.but i don,t know how to obtain my money from the check given to me.help me pls sir
this might be crazy but can anybody tell me any online biz sites that really pay people without been dubious cos i don,t wanna fall victim again.help me anybody and i will be happy.
U ar doing great 4 nigerian guys.in ova 3o minutes of browsing,dis is d only site dat gives advicd wt out askin 4 money.
Pls can give me d steps 2 follow 2 open an alert pay accout,do i need a bank account here 2.i realy need ur help cos i wana do paid surveys bt i dont know where 2 start from.
@Eddy
It is quite simple. Just click on the following link ALERTPAY you will be guided all the way. If you desire to transfer money from your alertpay account to a bank account in Nigeria, then you will need to open a domiciliary account with a bank in Nigeria. Cheers.
can you please provide me with other web hosting companies in nigeria
Thank you
I saw all your responds about alertpay, but for me it was so difficult for me to open alertpay account. like when i’m trying to open it and reach at ID or passport to proof the address i used in the accout, it seems they regetted my passport .
pls can you tell me what next i can do to open this account.
thanks
@ Daisy
You do not need ID or international passport to open the AlertPay account. You will only need those when you want to verify your account.
Is verifification compulsory? Here is the response from AlertPay website
Verification of an AlertPay account is not necessary in order to add, withdraw, or transfer funds. We believe verification increases the security of our network as we are able to verify and authenticate users. Although not necessary, verification is highly recommended.
In some cases, when transactions involve substantial amounts, our security center may ask some members to verify their AlertPay account in order to proceed with their transactions.
If you would like to become verified, simply follow these steps:
1. Log into AlertPay
2. Click on Become AlertPay Verified
3. Click on Upload Now
4. Select a document type
5. Select a form type
6. Upload scanned document
7. Repeat steps 2-6 for the next document
So I suggest you open the free account first by providing the simple details you are required to fill online. Later, you can upload photocopy or scanned copies of your Passport to verify the account. I hope this helps.
pls sir,
i want to know the best secure ways on how to use master card to purchase things online. so that people cannot drain-up my account without my notice.
THANKS
More grease to ur elbows!! This is very encouraging!! This is a perfect example of affiliate marketing!!
@Chijioke
Thanks for visiting and encouraging me. Cheers.
Good day sir! of a truth, I have read so many confusing facts about on line money making and how to recieve your pay right here in Nigeria. The point here is this, from the details I have read, I have been made to understand that I will have to own a paypal account alongside with a VISA CARD to enable me cash my money right here in Nigeria. I went on to sign in for a paypal account but couldn`t find Nigeria there in the list of countries. I sincerely need your full assistance on how to go about this whole process. Thank you very much for going through my text.
Thanks for the good Job.payment issue requires all hands on desk.Really!
I must say this site is just woah.I mean,i have neva taken my time in reading every details in any sites b4.I wish to follow every steps here.Get back to u
Alertpay no longer transfers money to Nigerian Bank Accounts,,,why?
What do i do to start earning from my Alertpay account?
I must commend your explanations above.I have been looking to do an online biz but the issue of payments n receipts was a problem.An inline friend directed me to ur site and alert pay.You even explained alert pay better than they did on their site.Opening an account right away….Thanks and more grease to your keyboard.
Nice and detailed article you have up here. Paypal still remains to be rivalled in online business for now. Just wishing we could find people to challenge its dominance. In my own opinion, Alertpay is just upcoming.
Please I need to know how I can deposit money in my alertpay account.Thank you.
Please, I av been having serieas of problems on how to open US bank account, how to withdraw from paypal becos i did not open and verify thru US bank account, and also on HOW TO COLLECT MY MONEY WITH ALERTPAY.
pLEASE CAN U HELP OUT
THANKS.
Please I want to open an alertpay account as a Nigerian how do I go about it moreso how do I withdraw after directing money to it.I need step-by-step details(on opening and withdrawing the money to nigerian account) please send feedback to my email
I luv dis site.
pls, i want to open an account on line from nigeria and to know how to get the cash, i need a direction pls.
can i recieve payment thru my credit card here in Nigeria
I havn’t had any deal with u, but i just have d impression that you are sincere from ur presentation. Because this is d first time i have heard a Nigerian begin really honest, to say d truth about d much talk about paypal, dat Nigerians are eligibel.No wonder it is said truthful peopel are scare to come by. Friend, I think if u can stick to saying d truth on the net business I do believe dat there are millions of Nigerians out there, like myself who will be more than willing to do business with YOU! KEEP IT UP! I AM yours truly David
I think etransact.com is much more easier and more convenient. mansheb.com has tutorials for creating your ecommerce website.
Please, I cant log in with my account, i log in with the password i register, it will not accept it. and send an email to them, and rest it. and still cant accept it. so pls help me.
Thanks for your good work here.I hope to check in more often now. I will also need the steps on Alert and any clue you ve got on paypal>
Thanks
Keep up the good Work.
God bless you.Pls how do I create my own site and host it at a minimal cost.THank YOu.
im habeeb olaiya, plz i want you to guide me on how to shop with alertpay online. or make payment with alertpay. looking forward to hear from you soon,
Mobile number: 08087189756