PayPal-PayGate Partnership: A Decade Later - Where Things Stand in 2025
More than a decade after PayPal and PayGate announced their groundbreaking partnership in September 2014, the collaboration continues to serve South African merchants, though the landscape has evolved significantly.
The Partnership Today
The PayPal-PayGate integration remains active in 2025, with PayGate's website still listing PayPal as one of its supported payment methods. The partnership allows South African merchants using PayGate's enterprise payment gateway to offer PayPal as a checkout option alongside other payment methods like card payments, instant EFT, and mobile wallets.
PayPal's Global Growth
While specific South African user data isn't publicly available, PayPal's global footprint has expanded dramatically since 2014:
- 434 million active accounts worldwide as of Q1 2025 (up from 152 million in 2014)
- $31.8 billion in revenue for 2024, reflecting steady growth
- 45% market share in the global payments processing market
- Processed $1.68 trillion in total payment volume in 2024
According to Statista, PayPal usage in South Africa for online payments remained relatively stable between 2020 and 2024, though exact penetration rates require premium access to view.
The Rand Challenge Persists
One limitation that existed in 2014 remains today: PayPal still doesn't support the South African Rand (ZAR) as a native currency. This means merchants continue to face currency conversion fees of up to 2.5% above the prevailing exchange rate, plus standard transaction fees of 2.4% to 3.9% + $0.30 per transaction.
Market Evolution
Since 2016, the South African payments landscape has become more competitive. DPO Group acquired a majority stake in PayGate in September 2016, creating a pan-African payment solution. This merger positioned PayGate as part of a larger network spanning East and Southern Africa, with 60+ employees providing support across the continent.
The Bottom Line
While the PayPal-PayGate partnership continues to function, South African e-commerce has diversified significantly. Local solutions like PayFast, SnapScan, and instant EFT options have gained traction, offering rand-denominated transactions without conversion fees. However, PayPal remains valuable for South African merchants targeting international customers, particularly in Europe and North America, where the PayPal brand still removes psychological barriers to cross-border purchases.
The partnership that began in 2014 has endured, but it now operates in a far more competitive and sophisticated digital payments ecosystem than when it first launched.
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