How to accept online payments in Nigeria: gateways, fees and setup

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To accept online payments in Nigeria, most businesses use a payment gateway that supports local cards, bank transfers and USSD, settles in naira to a Nigerian bank account, and connects to their website, app or invoices. Paystack and Flutterwave are the best-known gateways, and their fees and features differ in ways that matter for small businesses. This guide explains the payment methods Nigerians use, compares current fees from the gateways' own pages, walks through setup, and covers settlement, fraud and international payments.

How Nigerians pay online

Nigerian customers use several payment methods, and offering the right mix improves conversion:

• Debit cards, including Verve, Mastercard and Visa, are widely used for online purchases.
• Bank transfers have grown quickly, helped by instant interbank transfers. Gateways can generate a temporary account number for each payment so transfers are matched automatically.
• USSD codes let customers pay from a basic phone without internet banking.
• Mobile wallets and fintech accounts are popular with younger customers.
• Payment links and QR codes are useful for social media and WhatsApp sales.

Offering cards plus bank transfer covers most customers; USSD helps reach those without smartphones or cards.

Paystack fees

For local transactions in Nigeria, Paystack charges 1.5% plus NGN 100 per transaction, with the total local fee capped at NGN 2,000, and the NGN 100 waived for transactions under NGN 2,500. International card payments are charged at 3.9% plus NGN 100. Paystack advertises no setup or monthly fees. Fees are as published on Paystack's pricing page, which we check regularly; confirm before signing up.

The cap makes Paystack relatively cheap for larger local transactions: above a certain amount, the fee stays at NGN 2,000 regardless of size.

Flutterwave fees

Flutterwave's Nigerian pricing page shows 2% for local transactions, made up of a 1.4% transaction fee and a 0.6% platform fee, with 7.5% VAT charged on fees. International payments are charged at 4.8%. Flutterwave supports many African countries, which suits businesses selling across the continent.

Compare both, plus other options, in our best payment gateways in Nigeria ranking, and calculate the fee on your own transaction sizes with the Nigeria payment fee calculator.

Comparing fees on real transactions

Headline percentages can mislead. Work out the fee on your typical transaction sizes:

• On a NGN 2,000 sale, Paystack's NGN 100 is waived, so the fee is 1.5%, NGN 30. Flutterwave's 2% is NGN 40, plus VAT on the fee.
• On a NGN 20,000 sale, Paystack charges 1.5% plus NGN 100, NGN 400. Flutterwave charges NGN 400 plus VAT on the fee.
• On a NGN 500,000 sale, Paystack's fee is capped at NGN 2,000. Flutterwave's 2% would be NGN 10,000 plus VAT.

These examples use the published rates; check whether VAT applies on fees in your case. Our calculator does this for any amount.

Other gateways and options

Beyond Paystack and Flutterwave, Nigerian businesses use other licensed processors and bank-owned gateways, each with different fees, settlement times and supported methods. Some specialise in bank transfers or government payments. When comparing, check the payment methods offered, fees on your transaction sizes, settlement time, dashboard and reporting, plugin support for your website platform, and quality of support.

For a wider view of gateway types and fee structures, see payment gateway fees explained and the global payment gateways ranking.

What you need to sign up

Gateways must verify your business under Central Bank of Nigeria rules. Typical requirements include:

• Business registration with the Corporate Affairs Commission (CAC), or registration as a business name.
• Owner and director identity documents and BVN.
• A Nigerian business bank account for settlement.
• Proof of address and business details, such as a website or social media page.
• For some business types, additional licences or documents.

Many gateways let you start testing before full verification, but you cannot receive live payments until it is complete. Starter accounts for unregistered individuals may have lower limits.

Setting up on your website

How you connect depends on your platform:

• Hosted stores and website builders often have built-in integrations or plugins. Check that your platform supports your chosen gateway; see the e-commerce ranking and website builders ranking.
• WordPress and WooCommerce have plugins for the main Nigerian gateways.
• Custom sites and apps use the gateway's API or checkout library.
• No website: use payment links, invoices or a simple storefront provided by the gateway.

Test the full checkout on mobile, since most Nigerian customers shop on phones.

Selling on social media and WhatsApp

Many Nigerian businesses sell through Instagram, WhatsApp and other social platforms. Payment links let you send a customer a link to pay by card, transfer or USSD without a website. Some gateways offer simple product pages or storefronts. Combine links with a click-to-chat button from our WhatsApp link generator and see WhatsApp CRM for managing orders in chat.

Settlement and cash flow

Gateways pay out collected funds, minus fees, to your bank account on a schedule, typically the next business day for local payments, though it varies by gateway and account. Some offer faster or instant settlement for a fee. Check the schedule and any holds on new accounts, since gateways may delay early payouts while they assess risk.

Plan cash flow around settlement times, especially if you pay suppliers on delivery. Our cash runway calculator helps you see how much buffer you need.

Fraud, chargebacks and disputes

Card payments can be disputed by customers, leading to chargebacks. Reduce disputes by describing products accurately, showing clear refund policies, using a recognisable business name on statements, sending order confirmations and delivery updates, and responding quickly to complaints. Gateways provide fraud screening, and 3-D Secure authentication shifts liability for many fraudulent card payments away from merchants.

Keep evidence of delivery for physical goods and access logs for digital products, so you can respond to disputes within the gateway's deadline.

Accepting international payments

Both Paystack and Flutterwave accept international cards, at higher fees than local payments. International transactions carry more fraud risk, so gateways may apply extra checks. If you sell services abroad, such as freelancing or software, you may prefer to invoice in dollars and receive payment through a different route. See how to receive USD payments in Africa and how to get paid by international clients.

Taxes and records

Payment gateway fees may carry VAT, which affects your records. Sales received through gateways must be recorded and declared for VAT and income tax, and Nigeria is rolling out e-invoicing as part of its tax reforms. Reconcile gateway settlement reports with your sales and bank statements monthly. Our Nigeria VAT calculator helps with VAT on sales.

Choosing a gateway: a checklist

1. List the payment methods your customers use.
2. Calculate fees on your typical and largest transactions.
3. Check integration with your website, store or app.
4. Compare settlement times and any holds.
5. Check international card support if you need it.
6. Read verification requirements and timelines.
7. Test support with a question before signing up.

Common mistakes

• Offering only card payments and losing customers who prefer transfers.
• Comparing percentages without considering caps and fixed fees.
• Not testing checkout on mobile.
• Unclear refund policies that lead to disputes.
• Ignoring settlement holds on new accounts when planning cash flow.
• Not reconciling gateway reports with bank statements.

Example: a fashion brand selling on Instagram

A small fashion brand in Lagos sells mainly through Instagram and WhatsApp. Before using a gateway, customers paid by bank transfer and sent screenshots, which took time to verify and occasionally turned out to be fake. The brand set up a gateway account, created payment links for each product and size, and began sending links in chat. Customers now pay by card, transfer or USSD, and the brand sees confirmed payments in its dashboard before dispatching orders.

Later, it built a simple online store with the gateway plugin, so customers can browse and pay without messaging. The brand tracks which Instagram posts drive sales using tagged links from the UTM builder. For growing the store, see the cost to start an online store.

Example: a SaaS startup billing businesses

A Nigerian startup sells accounting software to small businesses on monthly subscriptions. It needs recurring billing, so it chose a gateway that supports saved cards and automatic charges, plus bank transfer for customers who prefer to pay manually. It sends invoices with payment links for annual plans, and uses the gateway's webhooks to activate accounts when payment succeeds.

Failed recurring card payments are common, often because of insufficient funds or expired cards, so the startup set up automatic retries and reminder emails. It also offers a discount for annual prepayment by transfer, which reduces fees and improves cash flow. Our LTV and CAC calculator helps it judge how much it can spend to win each customer.

Paying suppliers and staff

Many gateways also offer payouts: sending money from your balance to bank accounts, for example to pay suppliers, riders or commissions. This can be convenient, but check transfer fees and limits. For salaries, use payroll software that handles PAYE and pension; see PAYE in Nigeria. For paying suppliers abroad, see how to pay overseas suppliers.

Security for your gateway account

Your gateway dashboard controls money, so protect it. Use strong unique passwords stored in a password manager, turn on two-factor authentication, give staff their own logins with limited permissions, and keep API keys secret, never in front-end code or public repositories. Rotate keys if a developer leaves. Review payouts and settings changes regularly, and set up alerts for unusual activity.

Customer experience at checkout

Small details improve conversion. Show the payment methods available before checkout, keep forms short, show the total including any fees, and display trust signals such as your business name and contact options. After payment, show a clear confirmation and send an email or WhatsApp receipt. If a payment fails, explain what happened and offer another method. Track how many customers start checkout and how many complete it; a big drop suggests friction to fix. See how to build a landing page that converts.

Switching or adding a second gateway

Some businesses use two gateways: one as the main checkout and a second as a backup if the first has downtime, or for a payment method the first does not support. Others switch to get lower fees or better support. Before switching, check how saved cards and subscriptions can be migrated, update plugins and webhooks, and test thoroughly. Running two gateways adds reconciliation work, so keep it simple unless the benefit is clear.

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