Payment Observer

The Latest News, Industry Insights and Research Findings on Global Payment Markets

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31Jan/12

Franz Christoph Zeitler to Join the Supervisory Board of Payment Network

By Martin Schuppelius
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Payment Network appoints Dr. Franz Christoph Zeitler, a former member of the executive board of the Bundesbank, to its supervisory board as of February 1st, 2012.

Payment Network is well-known for its Rechnung by Sofort, a payment service that enables online merchants to offer their customers the option to pay by invoice.

Dr. Zeitler was the vice-president of the Deutsche Bundesbank from 2006 to 2011 and the president’s alternate in the governing council of the ECB. From 2002, he was a member of the executive board of the Bundesbank and was most recently responsible for legal matters and banking supervision.

Dr. Jens Lütcke, CFO of Payment Network AG commented: “We are very proud to have gained in Professor Dr. Zeitler one of the most recognised financial experts in Europe. The Payment Network is a young and rapidly growing company. Our goal is a standardized European payment area and Professor Dr. Zeitler’s competence and experience are an invaluable advantage.”

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31Jan/12

FIS Increases Strategic Investment in mFoundry

By Martin Schuppelius
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FIS) increased their stake in mFoundry, one of the most popular mobile banking vendors in the US.

strategic partnership with MasterCard to push NFC-enabled mobile payments solutions.

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30Jan/12

DIMOCO Expands Mobile Payment Service to Six More Countries

By Gary Merrett
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DIMOCO has added Russia, Finland, Norway, The Netherlands, Sweden and Spain to its network of countries. With this expansion, DIMOCO’s mobile payment transaction hub solution is now available in 19 European countries.

DIMOCO, headquartered in Austria, operates a mobile messaging and payment transaction hub whereby connections to mobile operators are bundled and provided to business customers to bill their digital content. Using DIMOCO’s payment services, companies can bill their digital content with the user’s mobile phone bill. While the processing of mobile messaging is already possible worldwide, the mobile operator payment is being continuously expanded.

DIMOCO Mobile Payment Coverage

DIMOCO Mobile Payment Coverage

DIMOCO is pleased with the development of its mobile payment business. The company has recently announced a 261 percent increase in the mobile payment transaction volume in the virtual goods sector. The results reflect the general industry trend of mobile operator payment becoming one of the most popular forms of micro payment billing.

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27Jan/12

Square-Like Mobile Card Reader mPowa to Start in the UK

By Gary Merrett
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mPowa.

The features, and also the reader itself, seem to be a copy of the established card processing service Square, wich is available in the US only. According to the company’s website, the free card reader adapter, in conjunction with an app, will enable iOS, Android and BlackBerry devices to process credit card payments. mPowa will take a 0.25% cut (with a minimum of 25p) of each transaction. This is a very competitive pricing, although the fee for the acquiring bank is not included. In comparison, Square charges 2.75% for each swiped transaction including bank fees.

There is a huge market for mobile payment and with NFC being far from ubiquitous, accepting credit payments via a card reader and an app on a smartphone can become a worldwide success story.

Check out the video below see how mPowa works:

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26Jan/12

Xsolla Partners with ZipZap for Cash Transactions

By Martin Schuppelius
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Xsolla, which specializes in online games, announced today that they have partnered with ZipZap, an alternative payments company that enables cash transactions for online purchases.

Xsolla offers a wide range of different payment options to gaming publishers across the globe, including credit cards, online banking, and mobile payments. Their new partner operates a global cash transaction network of over 700,000 payment centers, enabling consumers to use cash to make online purchases, pay bills and top-up e-Wallets, prepaid cards and mobile.

Adding ZipZap’s CashPay payment option to Xsolla will help publishers to expand their player base to teens and others who don’t have a credit card, or prefer to pay with cash. At big part of the gamer population, especially tweens and teens, do not have access to traditional financial services, but still want to be able to pay for virtual currency in their favorite games. Others prefer to pay with cash because they are concerned about credit card safety and privacy of their personal information.

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25Jan/12

Visa Now Processing €1 in Every €7 Spent in Europe

By Gary Merrett
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annual report 2011.

This growth now means that €1 in every €7 of consumer spending in Europe is on a Visa card, up from €1 in €8 in 2010 and €1 in €18 in 2000. The company also reported that the fraud losses on Visa cards in Europe reached an all-time low. In 2011, fraud was accounting for less than four cents in every €100 spent.

The credit card giant has issued of 30 million contactless cards and launched its first mobile payment services in 2011. ”We expect this growth in electronic payments to continue during 2012 when we will be launching mobile payments and our digital wallet services. These new services, that are a key part of our future of payments strategy, will revolutionise consumers’ everyday shopping experience to the extent that by 2020 we predict that over half of all Visa transactions in Europe will be on a mobile device,’ commented Peter Ayliffe, Chief Executive of Visa Europe.

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25Jan/12

Mobile Payment: The Big Picture

By Martin Schuppelius
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The official NFC-Logo

Although they idea to pay with a mobile phone has been hyped since the late 1990s, only a few countries have successfully implemented such services. Over the last few years, some major players have entered the mobile payment space. Currently the focus of the buzz is on Near Field Communication (NFC)-based services that support close proximity mobile payment.

Mobile payment is being adopted all over the world in different ways. In this article we provide a brief overview on the mobile payments.

Broadly speaking, mobile payment refers to all kinds of financial transactions performed from or via a mobile device. There are four main types of mobile payment: carrier billing, mobile wallets, mobile point of sale and mobile banking. In addition, there are a couple of other mobile payment solutions such as the SMS-based p2p money transfer service M-Pesa in Africa and Starbuck’s proprietary mobile loyalty and payment app. Also there is a lot of talking these days how mobile wallets will replace physical wallets and mobile banking is going to change the way we bank.

Carrier billing

Carrier Billing Paymet Flow using the example of Cashlog

One of the easiest methods of paying using a mobile phone is payment via a mobile phone bill. It is a very competitive market and many companies such as Boku, Zong and Atlas offer worldwide mobile carrier billing services. In detail, carrier billing can be realized via different schemes: premium SMS text, premium rate numbers, mobile web (WAP) billing and direct carrier billing. Today, carrier billing is mostly used for micropayments and purchasing digital goods such as ringtones, wallpapers or virtual items in online games.

Mobile digital wallets

A digital wallet works much like a physical wallet. It is a service that allows the user to store and use electronic money or shopping information. Recently there has been a big hype about implementing digital wallets on smartphones and tablets. Mobile wallets, such as Google Wallet or the mobile PayPal app usually feature contactless technologies such as NFC, QR-codes or location based services. Using those mobile digital wallets, the user can use his smartphone to pay both online and at retail stores.

Mobile point of sale

Mobile Card Reader and App using the example of Intuit GoPayment

Mobile POS solutions such as Square in the US and iZettle in Sweden allow retail merchants to process card payments via their smartphone or tablet. Usually the combination of a small card reader that connects to the mobile device and an installed application enable the merchant to receive payments without the need to buy an additional device.

Mobile banking

Mobile banking provides banking and financial services including the initiation of transactions or balance checking just like online banking services. This includes the use of mobile web pages as well as dedicated smartphone applications. In addition, some mobile banking solutions can also be used to make micro-transactions or contactless payments directly via the mobile phone.

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24Jan/12

Skrill Launches One Tap Mobile Payment Service

By Martin Schuppelius
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Online payment service provider Skrill has launched a new product: Skrill 1-Tap. It enables merchants to offer customers the opportunity to pay in “one tap”, rather than having to re-enter login details or credit card information. In addition, the company has extended its Quick Checkout Enterprise payment suite by introducing a HTML5 payment gateway specifically targeted at mobile devices.

Skrill (formerly Moneybookers) is one of the largest online payments systems and digital wallet providers with over twenty million customers worldwide and more than 100,000 merchants. The digital wallet service allows customers to make online payments without revealing personal financial information to the merchant. When customers pay via Skrill for the first time, they have to provide their payment details as usual. Once complete, they will then be given the option to enable the Skrill 1-Tap feature for future purchases with that specific merchant. Furthermore the company has rolled out a HTML5 mobile payments gateway. The gateway will automatically resize so that it is optimized for viewing on any smartphone or tablet device.

The new services are designed to make m-commerce more convenient and give customers a seamless mobile shopping experience. “With new the smartphone revolution, m-commerce has finally the potential to really take off,” said Martin Ott, co-CEO at Skrill. “But the truth is that, for many on-the-go consumers, the idea of using their mobile to enter payment information appears difficult and time-consuming. Skrill 1-Tap changes all this by offering a quick and easy way to mobile payments.”

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23Jan/12

Cashlog Adds HTML5 Support

By Martin Schuppelius
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Cashlog now supports HTML5 in-app purchases. The new features enable merchants to offer cross-platform direct mobile billing, including one-click purchases for users who are contented via UMTS.

most recently in Germany. According to the company, the features are upgraded automatically, allowing both single purchases and subscription models for all sales with direct mobile billing on the smartphone.

As competition in the mobile payment market rises, mobile carrier billing providers have to offer new features such as cross-platform support and one-click billing in order to differentiate from their competitors. Guido Mangiagalli, Head of Cashlog, commented: “The growth of mobile commerce makes mobile payments the next big thing, replacing cash and credit cards transactions. Cashlog, thanks to its HTML5 upgrade is making this experience almost flawless, and merchants can get higher conversion rates”.

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20Jan/12

Digital Banking to Become the Norm by 2015 Says PwC Survey

By Gary Merrett
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The new digital tipping point’ by PricewaterhouseCoopers. The report reveals that there is a strong demand for digital banking products from consumers and the fact they are willing to pay up to $15/month for these. PwC interviewed over 3,000 banking customers globally in May and June 2011 for the study.

Although new technology is opening up banking to a number of new players, the survey reveals that the majority of respondents still trust their banks over other providers with their current account. According to PwC, banks may consider to partner with technology, mobile and other non-traditional banking providers to deliver the digital experience customers expect. Matt Hobbs, retail and commercial banking partner at PwC, commented: “The growth of digital has removed key barriers to market entry, including the need for large branch networks, customer inertia and brand trust. Because of this, banks need to consider strategic acquisitions or partnerships with digital innovators to secure their long-term position and market share.”

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