Credit card vs EFT as payment method online

[UPGR8 Gear]

Hi again everyone,

This is an open question, and looking forward to your responses. If you were to buy online, what would you prefer to pay with? Credit card or EFT? What would / wouldn't make you use on or the other?

The one thing that concerns me is Credit Card fraud - not being a victim of it, especially if you're selling goods using this method. How does one prevent fraud effectively?

Any thoughts on this would be appreciated..

Cheers

 

[bwana]

AFAIK using a credit card offers me more protection.

 

[CathJ]

I usually prefer EFT - that way no-one has my credit card number (too many companies store your number and details, without telling you). It's often slightly slower, but I feel it's safer in that respect.

Of course, there are some downsides - you don't get the fraud protection you would with a cc (if you pay and they don't deliver); and you generally have to pay when you order with EFT whereas with a cc they generally only charge your cc when they ship.

 

[UPGR8 Gear]

Hi all, thanks for the answers so far. With these two posts, its 50-50. Obtaining credit card facilities can be expensive and pretty risky for a supplier, so i am trying to establish if just having EFT at this stage is not aligned to what most people would prefer.

Please give me your thoughts...

 

[undesign]

I've only ever used credit card. EFT seems a bit of a hassle. Get banking details, log into banking website, wait for SMS for once-off payment, pay, send proof of payment.

 

[cyberarmy]

I use EFT only if I am dealing with merchants that I had used before and rated trustworthy.

Otherwise I use CC for online payment. Paypal is only for international payments where they only use Paypal or CC.

Maybe you should search around the forum as I remember someone had asked similar questions before and some of our merchants here suggested cheaper CC processing gateway (if that's also what you looking for).

 

[CyraxHB]

I generally prefer using a credit card. That said, I have been a victim of CC fraud. Not on my south african credit card but my UK one. The bank paid me back within 7 days and sent a new card so it wasnt too bad.

 

[guest2013-1]

Hi again everyone,

This is an open question, and looking forward to your responses. If you were to buy online, what would you prefer to pay with? Credit card or EFT? What would / wouldn't make you use on or the other?

The one thing that concerns me is Credit Card fraud - not being a victim of it, especially if you're selling goods using this method. How does one prevent fraud effectively?

Any thoughts on this would be appreciated..

Cheers

Credit Cards offers protection against consumers being ripped off as well as retailers. As a retailer, if you're part of the MasterCard SecureCode or Visa Verified programs on your merchant account, then the liability for fraud moves from you to the bank, meaning if you're subject to fraud as a retailer you won't suffer the consequences.

EFT is dangerous, especially with conmen. There was a couple of people in Dubai last year that got "last minute tickets" to the Beijing Olympics or something, paid in excess of $4000 and had to wire the money. Once the money was wired they dissappeared.

Normally credit cards offer a 60 (or 90?) day window period for you to claim any type of fraudulent behavior on your account. With EFT you have less than 48 hours, and you only usually find out a couple of days later that you were victim of a scam.

 

[guest2013-1]

I usually prefer EFT - that way no-one has my credit card number (too many companies store your number and details, without telling you). It's often slightly slower, but I feel it's safer in that respect.

Of course, there are some downsides - you don't get the fraud protection you would with a cc (if you pay and they don't deliver); and you generally have to pay when you order with EFT whereas with a cc they generally only charge your cc when they ship.

a company that stores your credit card information has to divulge that they're doing so, which systems and protection is in place to keep that information safe and how they safeguard it for you. If they don't and you feel they store your CC information you should contact the authorities

 

[Crusader]

I definitely prefer using my CC. It's much more convenient and it offers you protection if the the person you bough from doesn't deliver the product. With an EFT it is an added hassle of going through the whole process, having to fax proof of payment (many places will only accept faxes for some reason) and if they don't deliver there's no way you can get your money back.

 

[Frankie]

I generally prefer using a credit card. That said, I have been a victim of CC fraud. Not on my south african credit card but my UK one. The bank paid me back within 7 days and sent a new card so it wasnt too bad.

This is just one example of the protection the CC enjoys.

For example - If you pay for goods by EFT and an unscrupulous merchant ships the wrong thing or something that does not live up to the advert you can kiss that money goodbye, but if you paid with a CC you can activate a dispute with your bank, and if they satisfy themselves that you have been scammed, then they'll return your money.

There's a lot of other benefits and protections with a CC and they vary slightly between the banks.

I've been using my CC for many years and have never had any attempt at fraud, and only once when the merchant shipped the wrong goods and was reneging on paying a courier to collect from me and send the correct goods - Bank of America stepped in and the merchant refunded and left me with the goods.

I've noticed that many SA online shops insist on EFT - I just find what I need elsewhere.

 

[PC Direct]

What we've done to ensure a customers money is received the quickest is to have business banking accounts with all four major banks namely Nedbank, Standard, FNB and Absa.

This offers great protection for the customer as EFT's are highly secure. We recieve payment literally instantaneously 99% of the time, and this empowers us to process the delivery ultra fast.

Products usually arrive the next day as we ship from all major city centers. So if you're in JHB, and want a laptop - we ship to you from our JHB depot. Same goes for rest of country...

We might go for credit cards soon, but really we've only had like 2 requests for CC in like 3 months

 

[guest2013-1]

What we've done to ensure a customers money is received the quickest is to have business banking accounts with all four major banks namely Nedbank, Standard, FNB and Absa.

This offers great protection for the customer as EFT's are highly secure. We recieve payment literally instantaneously 99% of the time, and this empowers us to process the delivery ultra fast.

Products usually arrive the next day as we ship from all major city centers. So if you're in JHB, and want a laptop - we ship to you from our JHB depot. Same goes for rest of country...

We might go for credit cards soon, but really we've only had like 2 requests for CC in like 3 months

If I may ask, with being at 4 major banks to receive money, do you conduct business out of those 4 accounts as well (paying creditors etc?)

How much of a hassle was it setting up all those accounts. I know banks are usually stingy with SMB's.

And how do you manage all of those accounts making sure the payment came in from one of them? Isn't it a bit too much admin work?

 

[PC Direct]

No hassle getting the accounts.

Pay creditors from all accounts yes.

Admin isn't too bad.

 

[milomak]

i got a 2nd CC to use for online transaction. It has a R1000 limit and no budget facility

 

[CathJ]

i got a 2nd CC to use for online transaction. It has a R1000 limit and no budget facility

I wanted to do that. But the only one I could find that didn't charge annual fees was Virgin, and they're useless - I couldn't go back to my application (I only filled out the first page, just to see what documentation they needed, then couldn't carry on later) and they couldn't read my emails (they said they could only see the subject line).

So I gave up.

 

[milomak]

I had actually wanted the credit to have no credit (ie not be able to spend anything on it unless I put cash into it). I can only guess that given it’s a credit card, it has to have some credit. I keep on meaning to ask them to decrease it but I just can’t be bothered.

 

[noxibox]

As a buyer there is no advantage to using EFT. You get essentially no protection. With a credit card you assume essentially zero risk. Even if someone uses your card fraudulently you're protected.

 

[UPGR8 Gear]

Wow, awesome response, thank you very much!

Most seem in favour of credit card. Banks though are very tough with costs - 6% on credit card transactions, monthly fees etc. When you add it up, it becomes quite heavy. If volumes require it, and it is justifiable, then yes no problem. I did some basic calcs the other day with MyGate - it works out to around R900pm to have a credit card processing facility and Nedbank merchant account.

Options such as Setcom don't require that you have your own merchant account, but it takes a while for you to see your money - can be quite heavy on cashflow.

 

[Frankie]

Wow, awesome response, thank you very much!

Most seem in favour of credit card.

With the exception of a supplier that participated in the thread

I would never use EFT when making online purchases, and for those that fear the temptation of a credit card, just get a cheque card that offers all the protection of a credit card.