Online classified service Gumtree South Africa continues its quest to build trust in the online peer-to-peer trade market by incorporating Shepherd, a Standard Bank-powered escrow service.
“Classifieds are immensely popular, but there are risks associated with trading online, such as meeting someone in person that you don’t know, handling cash or the risk of non-payment after delivery,” says Johan Nel, country manager of Gumtree SA. “It’s our belief that, while millions of South Africans are already prolific traders online, there are as many who want to participate but are wary to do so. We want to remove those barriers and offer safe alternatives to the conventional face-to-face interaction.”
Shepherd operates as a third party that facilitates transactions on behalf of sellers and buyers and is offered as an option to Gumtree customers. “The process is fairly simple,” explains Martin Reynolds of Shepherd. “Either the buyer or seller can request dealing through Shepherd. After the seller initiates the transaction, the buyer makes a payment into a secure trust account. Shepherd secures the funds until the buyer receives the item and accepts it and facilitates the delivery through Ram couriers. The buyer simply signs the courier waybill to accept the delivery if she is satisfied with the item. Shepherd then releases the funds to the buyer. If the buyer isn’t satisfied, the item is returned to the seller and the buyer’s payment refunded.”
According to Reynolds, this not only eliminates a lot of the risks involved but also opens up the large Gauteng market to buyers and sellers elsewhere in the country. “ There is no need to only deal locally anymore.”
Craig Polkinghorne, Head of Business and Commercial Banking at Standard Bank, says while e-commerce continues to grow in South Africa, the biggest concern for online shoppers remains the availability of secure payment platforms.
“At Standard Bank we view safety and security as a top priority for our customers. We found it fitting to support Shepherd’s escrow service as it aligns with Standard Bank’s commitment to constantly deliver safe and convenient banking platforms and solutions to customers. Shepherd simply eliminates the payment risks associated with online shopping, enabling the buyer and seller to focus on completing the transaction.”
Nel says that, while the vast majority of Gumtree customers are familiar enough with online safety to allow them to transact without incident, Shepherd adds additional peace of mind. A small transaction fee is charged for the service, but Nel believes the benefits of the service far outweigh the cost.
“It’s worth paying a nominal fee for peace of mind when you could be spending over R15,000 for an Apple Mac or a rare collectible. Having said that, the fees are so small that items as inexpensive as a R1,000 can be traded with equal ease.”
Shepherd is iniitially limited due to item size restrictions.
Users can sign up online.
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