top of page

The Growth of E-commerce and Online Payments

Updated: Jan 25


A laptop showing sweaters sold on an e-commerce store with overlaying text reading The Growth of E-Commerce and Online Payments

Almost certainly accelerated by the 2020/21 pandemic lockdowns, e-commerce is now growing at a faster rate globally than offline retail sales, notably 16.2% in 2022 versus 3.8% respectively. The value of e-commerce sales in that same year was $5.2 trillion, and contactless payments, which are a major factor driving the growth of online shopping, contributed a total of $1.6 trillion.


More payment methods and platform choices, increased security and the ease with which consumers can now shop online and do other e-business are all having an enormous impact on the global marketplace, opening up new consumer sources and geographies to businesses across all industry sectors.


The evolution of e-commerce in South Africa and changes in online behaviour


The South African e-commerce market is one of the largest and fastest growing on the continent. Over the past decade, the penetration of smartphones and increased access to the internet has enabled the South African e-commerce market to make significant gains. In 2022, 80% of South Africans were internet users and there were 27 million registered e-commerce users. The value of e-commerce transactions in this country is expected to reach R225 billion by 2025.


Just about every retailer with a presence in South Africa, plus a whole host of small to medium enterprises (SMEs), in particular in clothing and fashion, cosmetics and gifting, have developed attractive and sophisticated online shopping sites. Online user experience has become of paramount importance in attracting and retaining customers and interfaces which feedback on consumer habits and preferences enable businesses to make almost immediate improvements and updates in response.


Massive improvements in delivery methods, ensuring that whatever you order online will reach you, have also boosted the confidence of South African online shoppers. From pick-up and drop-off lockers to door-to-door deliveries of groceries, security of arrival is now more assured, contributing to more online shoppers and changed behaviours.


Empowering consumers with secure digital payments


Above all, consumers have become more inclined to make online purchases with the advent of secure, quick and simple digital payment methods. Being able to make a purchase any time of day or night and complete a transaction in real-time has opened up the e-commerce market. Digital wallets and other contactless payment methods have simplified how consumers can conduct business. For traders, having their online stores open 24/7 around the world with easier cross-border transactions and encrypted, safe and secure payment processes, has opened up new markets. 


Using encryption algorithms to prevent online fraud, digital payment platforms and emerging technologies such as blockchain and QR code payments, are further revolutionising e-commerce. Scan to Pay, powered by Ukheshe, in particular, has changed the payment landscape with a contactless system in which a smart phone speaks to a merchant’s QR code and payment is immediately processed. Scan to Pay alleviates any need for loading banking details onto the third-party platform, and ensures no personal information is stored by the vendor. This allows Scan to Pay transactions to remain safe, secure and immediate, ensuring seamless transactions for consumers.


Diversity of payment options


The proliferation of digital payment options offers consumers a wealth of choice, according to their access to credit, online banking and digital wallets. In addition, cryptocurrency is increasingly offered as a payment method on some e-commerce sites and all these choices open up the market for vendors.


Scan to Pay is a highly versatile system that is already integrated into the online payment processes of more than 600 000 merchant locations, 14 banks and fintech companies and 94 payment service providers.


Building trust and loyalty in the digital realm


Providing online consumers with choice and security are the two of the most important factors for online businesses in building trust and creating brand loyalty. In building the trust of its users, Scan to Pay, powered by Ukheshe has created an important secure online payment ecosystem and is committed to retaining its position as leader and innovator in the digital payment space.


E-commerce has the potential to shape the future growth trajectory of South Africa’s economy. In a country beset by unemployment, it offers SMMEs and SMEs the opportunity to trade not only locally but internationally, bringing them into the mainstream economy. 


Advanced digital payment methods facilitate secure and efficient incoming and outgoing transactions and are a win win for both businesses and consumers. South Africans may love their shopping malls, but they are beginning to love online retail even more.  

Comments


bottom of page