Speeding up last-mile delivery with seamless payments

South Africa’s e-commerce market has surged since the pandemic. Our Consumer Perspective on E-commerce report showed that South Africans are now spending, on average, 10% of their income on online purchases.

The growing popularity of marketplaces such as Takealot, Shein and, most recently, Amazon, is driving greater demand for efficient and fast last-mile delivery services, while increased internet penetration continues to boost the growth of online purchases in the economy.

Logistics and last-mile delivery use cases

According to our consumer report, the most popular categories for last-mile delivery are food, groceries, clothing and household goods. These can be classified into three categories: food delivery, groceries and courier services.

E-groceries

Key players: Checkers Sixty60, Pick n Pay ASAP!, Woolies Dash

According to Statista, the e-grocery industry is expected to grow by 11.34% every year for the next five years. Key players like Yebo Fresh, which targets township deliveries, and Mr. D, along with Uber Eats and One Cart, allow consumers to shop from different retailers on one app.  

This category primarily accepts card payments exclusively. This is in line with our consumer perspective survey, in which 72% of respondents indicated they prefer to use card for payments in this category, followed by Pay by bank and cash on delivery.

An important feature of this category is the ability to provide substitutes and have a transparent refund process in the event of price differences or missing items. A competitive solution allows customers to choose to have their credit refunded to their wallet or their bank account and reflect quickly. Alternatively, these providers can leverage card preauthorisation to put a hold on the user’s card, to be charged once they can account for variable costs due to different or missing items.

Check out with a reliable payment gateway

Merchants in the grocery delivery space can reliably accept card payments, as well as alternative payments via Digital Wallets, Pay by bank, Capitec Pay and more - and process bulk refunds - through the Stitch payment gateway. Through a single platform, they can reconcile card payments across methods while initiating instant payouts or refunds to any South African bank account.

These clients can also leverage Stitch to reduce fraudulent and failed payments through bank account verification tools and our AI-driven fraud engine, Stitch Shield.

Courier services

Key players: The Courier Guy, Pudo, Aramex, DHL Express, FedEx

Merchants with online stores look for simple and fast ways to credit their account with their courier service provider. Accounts need to be funded quickly if shipping needs to start immediately.

Similarly, when a consumer has a package waiting or needs to send something, they’re eager to access their delivery and need a fast, seamless way to pay.

Close the distance with Stitch Pay by bank

Merchants in the courier and delivery space can allow customers to make one-click payments to top up their accounts or pay for a delivery via card, Digital Wallet, or directly from their bank accounts with Pay by bank. Our one-click solution streamlines payments by giving returning customers the option to save their details and make future payments in one click, for more efficient processing and a streamlined experience.

Stitch also enables Capitec Pay, Absa Pay and Nedbank Direct EFT methods through our direct bank APIs, alongside other methods, offering more choice for customers in how they wish to pay.

Food delivery

Key players: Uber Eats, Mr D Food, Checkers Sixty60

The food delivery industry is time-sensitive and tends to be more vulnerable to negative customer experiences. Customers expect their meals to be delivered quickly, despite efforts to set realistic delivery times. Additionally, payment issues can lead to cart abandonment, as customers may choose to grab something from their fridge or use another platform instead.

This category is one of only a few that accepts cash on delivery in addition to card payments. Results from our report show that cash on delivery is one of the most preferred payment methods for online shopping in South Africa, but it comes with a lot of challenges. Fast, seamless and reliable digital payment options can continue to move customers toward digital-first options and increase trust in the platform.

Hot deliveries through flexible payment methods

Stitch enables merchants to offer more, and more reliable, payment options. Merchants in the food delivery space can leverage Stitch to accept fast, seamless payments via digital wallets like Apple Pay, Samsung Wallet, and Google Pay, or traditional methods like card or Pay by bank.

Our recurring payments solution is designed to streamline collections and reduce payment failures for subscription services such as Uber One and Checkers Xtra Savings Plus. It also allows merchants to preauthorise a variable hold on a user’s card in the event that their order amount changes.

Be the first at the door

The landscape of South African payments is evolving, and so are consumer payment preferences. To stay competitive in the logistics and last-mile delivery space, offering a fast, seamless and reliable way to pay can help one platform stand out against the rest.

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