How to Accept Online Payments Through 3rd Party Merchants in the UAE

Now that technology went so far, it is no wonder that we try to use smart solutions, when operating businesses. Providing a number of payment methods to your clients, helps to close deals faster, avoid long waiting period for bank transfer receipts and make the process of payment more convenient for clients. Today if you want to be competitive in the market, it is not enough to provide quality service, it is equally important to render services fast. To do it promptly, you need first to receive the payments for your services fast as well. How can you do that? The answer comes in this chapter.

The conventional methods all businessmen in the UAE use are cash payments, cheque payments and bank transfers. But are there other options available? Yes, there are. Let’s have a closer look at them.

In general, we will be discussing two more solutions. These are online payments via various payment gateways and payments by cards through Point of Sale machines.

If you are passionate about e-commerce business, you may have more interest in online payment options. In the past years the range of service providers offering online payment gateways significantly increased. Today markets can offer you, PayPal, Visa Checkout, Telr, Payfort and others.

As a start-up entrepreneur, the first thing that may come up to your mind would be to create a business account with PayPal. You will go through a verification process, provide your company’s business license and complete a short questionnaire. Please note, before you choose PayPal as a suitable solution for your business needs, review the fees and charges of the service provider. PayPal web-site lists a fee of 3.4% on receipt of funds on every invoice for goods or services below 3,000 USD, as well as cross-border transaction fees apply. Several years back it was not possible to withdraw funds from your PayPal account into your UAE bank account. However, partnership between PayPal and Network International made it a reality. To avail from withdrawal service, you will need to pass verification first and then file a request for funds withdrawal. The maximum amount for a single withdrawal is an equivalent of USD 10,000 and it make take up to five working days for your transaction to be credited into your bank account. Withdrawal fee varies from 1 to 1.7%, depending on the amount you wish to withdraw.

Another solution that was announced not that long ago in the UAE and proved to lead to high sales conversion rate is Visa Checkout. Visa Checkout is now available in the UAE and is already used by leading companies in the country. The concept of Visa Checkout is very close to that of PayPal, with the major difference being the number of users and merchants availing of the service.

There is also a number of regional service providers, such as, Telr.com and PayFort.com. Please note that the latter does not work with a complete list of businesses in the UAE and there is a certain restriction for some industries. More specifically you can read on the web-page of the service provider. In general, the fee for processing of transactions may vary from 2,69 to 2,99%, however, in case of Tellr, for example, you may use the service and infrastructure with no commission for each transaction at a monthly fee of AED 349, provided you earn not more than AED 20,000 a month. You can find more details on the pricing and terms and conditions on the web-site of service provider.

While we have enumerated several payment options in the UAE, there is a service provider, which offers both the payment gateway and facilitates transfer of funds from your e-wallet accounts to your bank account and it is Network International, a company which we already briefly mentioned.

Network International is a Principal Member of Visa International and MasterCard International and this allows the company to offer its customers the most comprehensive range of products. Network International is the largest merchant acquirer in the UAE and enjoys more than 55% of the market share across the country.

Network International was established in 1994 by Emirates Bank, which 13 years after merged with NBD in order to provide payment processing facilities to the bank. Today Emirates NBD retains its 51 per cent stake in the company. Today the company serves more than 70 banks and financial institutions across 17 countries in the Middle East and Africa and manages one of the region’s most extensive ATM networks.

The main service Network International provides is a Neo Merchant Account portal, which will allow you to accept payments by all major debit and credit cards, as well as paypal, visa checkout and a number of others. The one-time set-up fee for the service will be approximately AED 5,000, while there will also be an annual subscription fee approximately AED 5,000, in addition to service charges per each transaction, which is approximately 2.30 %.

Additionally, Network International is behind partnerships with multiple payment service providers in the UAE. What it means, payment service provider offers you IT infrastructure that allows your company to receive funds into your e-wallet. Next Network International LLC takes care of funds transfer from your e-wallet to your UAE bank account. This mechanism you saw already in case of PayPal operations in the UAE.

If you are not in an e-commerce business but rather in a service industry, it may be beneficial for you to arrange for a Point of Sale machine (POS machine for short), which allows clients to pay by cards.

Same Network International also provides POS machines. You will also find that Mashreq bank offer similar solution. If you are coming from Europe or the US, you might be looking for an offline POS machine. Here we would like to warn you, that you will not be able to get those in the UAE. Offline POS machines can be sometimes found with large local hotel chains only. They are no longer provided to businesses due to a high risk of using the same for fraudulent purposes.

When you apply for a POS machine, you will again need to pass the verification, pay subscription fee that may be around AED 1,400 and start using the machine in your day-to-day business operations. A certain fee per transaction of approximately 2,25 to 2,65% shall apply.

In this chapter, we wanted to give you a general overview of options available in the market. We urge you not to judge on the transaction rates only. Instead, make sure you first learn all details regarding exchange rates, refund fees, charge back rates and more.

If you want to know more about Dubai freezone company formation, feel free to get in touch with our professional consultant team and we would be delighted to assist you and help you to compare Dubai freezone company setup costs and help you to find that free zone, which would suit your business needs the most.

Disclaimer: Business Boutique UAE-Consultants.com is not affiliated with any particular government or legal entity. Business Boutique does not give professional legal advice nor any other professional advice subject to a public office in the government. This article merely sets out a simple and basic idea as to the reasons of Dubai freezone company setup and Dubai free zone company formation cost. Business Boutique in no way holds nor imposes any official governmental or legal authority and the article herein is only to be taken as a guide. All further governmental or legal issues should be addressed to the corresponding authorities.

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