buy metformin online

Online M-Payments Company Boku Seeks to Expand to In-Store Payments Using NFC

Feb 23 2012 (All day)

Telco-backed online mobile-payments company Boku is seeking to expand to the physical point of sale using NFC phones, contactless stickers and conventional prepaid cards and is partnering with MasterCard Worldwide to help with the move.

U.S.-based Boku, along with MasterCard, today announced the new product, Boku Accounts, which Boku said would enable mobile operators to roll out telco-branded prepaid payment cards, as well as prepaid applications on NFC phones and passive contactless stickers. 

Consumers could tap the cards, stickers or phones to pay for purchases in stores and restaurants that accept MasterCard's PayPass application. The prepaid cards would sport a contactless interface but also could do conventional magnetic stripe or EMV transactions for the many markets with a low penetration of PayPass-enabled POS terminals.

UPDATE: A Boku spokesman told NFC Times there is no exclusivity with MasterCard and the "white-label" payment platform could support other payment networks. Boku Accounts is launching with MasterCard, however.

The platform also supports discounts, loyalty programs and other offers, which telcos could deliver to consumers based on “demographics, purchase history, competitor shopping patterns, and geolocation,” said the company, which has developed apps for Android phones and the iPhone to support the offer.

Boku's senior vice president for product marketing and strategy, David Yoo, told NFC Times the company has received strong interest in the product from telcos in discussions over the past six months. Using the platform, the operators would take a cut of payment transaction fees and could also earn revenue from merchants when consumers redeem coupons, points or other offers. Boku would also collect fees from merchants. 

“For operators that have no card program or licenses, we can provide the entire solution in the box; they slap on their logo,” Yoo said, adding that the relatively few telcos that already have banking or e-money licenses could expand their reach with the platform, including with the offers. 

Prepaid payment service provider IDT, which has a banking license and is certified to issue cards accepted in both the MasterCard and Visa payment networks, would issue the cards and PayPass applications for telcos in Europe. Boku has another prepaid issuer lined up for the United States, which it declined to name.

“MasterCard wants to provide these services with us potentially to set up new issuing partners around the world,” Yoo said. “MasterCard lends their brand and acceptance network and Boku provides all the product and services and technology that integrates into the MasterCard network, so operators can brand it to their customers.”

Some mobile operators are already collaborating to build common NFC platforms to redeem coupons, rewards and offers, as part of joint ventures or consortia. They include Isis in the United States and the three largest telcos in the United Kingdom.

Yoo said Boku has been talking to some of the operators that have formed groups or joint ventures, but he declined to name them.

Boku next week will announce a new round of funding, with a large mobile operator group participating, said the company. And a UK telco is trialing the Boku Accounts platform internally, though Yoo declined to name it. END UPDATE.

Boku has raised nearly $40 million from venture capital firms since its formation in 2008 from such Silicon Valley venture capital firms as Andreessen Horowitz, Benchmark Capital, DAG Ventures, Index Ventures and Khosla Ventures.

It has deals to date with more than 240 mobile operators in 67 countries to enable consumers to purchase virtual goods using only their phone numbers and a confirmation via their mobile phones. Consumers get billed for the micropayments, for such purchases as video game credits, on their monthly phone bills or the purchases are deducted from their prepaid mobile accounts. 

The fees physical merchants pay will be much different from the high charges sellers of virtual goods incur on Boku's carrier-billing model. In the physical world, merchants will pay the same rate they pay on conventional prepaid card programs, but Boku mobile operators will take a cut of the transactions instead of, say, a banking issuer. Merchants would balk at paying higher total transaction fees. 

For online payments, Boku now collects a single-digit percentage of each transaction from virtual goods merchants for providing the global m-payments platform, including handling risk management, settlement and related services. Mobile carriers take a cut of between 5% and 45% of the purchases, Boku president Ron Hirson has said.

Competing with Banks, PayPal, Google
The product, if Boku gets it off the ground, would compete directly with major banks as well as PayPal, the e-commerce payments division of eBay. The much larger PayPal is attempting its own jump to the physical point of sale, planning to enable consumers to pay in-store by tapping their phone number and PIN code into POS terminals or swiping conventional cards. PayPal intends to support NFC later.

UPDATE: It would also compete with the Google Wallet, which like Boku Accounts supports mobile prepaid cards and PayPass. Google Wallet also stores a credit application issued by Citigroup.

But unlike Google, which seeks to enable consumers to redeem payments, coupons, rewards and offers in a “SingleTap,” the Boku Offers and Loyalty platform does the transaction away from the POS terminal. The payment processor links to Boku's servers to redeem the discounts or other offers to the consumers' prepaid accounts on the back end.

Google Wallet is designed to do the payment, couponing and offers all on the terminal. Relatively few merchants can support the SingleTap concept, however.

Yoo said the network-based redemption means existing POS terminals, even though they do not support contactless, could process the discounts, points and other offers. 

Challenges Ahead
But the Boku Offers and Loyalty platform comes with its own challenges. Besides having to sign up all new merchants to accept the nonpayment applications, merchant payment processors would have to tie into Boku's servers. Yoo said only one MasterCard-certified processor, which he declined to name, so far supports the platform.

It's also unclear whether transaction times to do payment and redeem offers and coupons over the network would take significantly longer than online payment alone. And in countries that do a majority of transactions offline, at the terminal, using EMV chip cards, there would be complications to support the online offers.

In addition, targeted promotions based on demographics, purchase history, shopping patterns and geolocation would require customers to opt-in, and it's unclear whether the technology behind many of these advanced customization services is ready yet. END UPDATE.

There are still other challenges. MasterCard still has to integrate the payment service into its network. And enabling the service on NFC phones faces the same problems as with other NFC commercial payment launches. That includes getting phones into the pockets of consumers and, once there, managing the applications on secure elements in the handsets.   

At present, the Boku online mobile-payment system competes with MasterCard and Visa, in a sense, though many of the small purchases, such as video game credits, would not have gone through MasterCard or Visa to begin with. Boku hasn't released transaction volumes. 

Whether Boku’s bold attempt to expand into in-store purchases succeeds remains to be seen. It will be a big jump from enabling mobile subscribers to buy Facebook credits to competing with large banks and PayPal at the physical point of sale. 

 

HEADLINE NEWS

Contactless Reader and NFC Vendor OTI Reports Higher Sales

Israel-based On Track Innovations reported new orders for its NFC and contactless readers in North America, along with the first shipments of its NFC-enabled Wave attachment, driving higher revenue, though the vendor’s quarterly losses continued.

Identiv Reports Higher Revenue; NFC a Key Driver

U.S.-based Identiv reported higher revenue and narrowed losses for the second quarter, predicting a breakeven or positive result by the end of the year, as the company’s restructuring program draws to a close.

Inside Sees First-Half Revenue Fall, but Says Strategic Shift on Track

Aug 5 2014 (All day)

France-based Inside Secure reported a 9% drop in revenue in the first half, which it blamed on the end of shipments of NFC chips to BlackBerry and lower sales of “legacy” EMV chips to Europe.

Westpac NZ Product Chief: HCE Offers Bank More Simplicity, Control

Aug 1 2014

NFC Times Exclusive: Westpac New Zealand’s product chief told NFC Times he believes host-card emulation will reduce costs and increase flexibility, while ensuring the bank can use its own branded wallet.

With HCE Threat Looming, Telcos and Their Trade Group Seek to Cut Cost and Complexity of SIM-Based NFC

NFC Times Exclusive: With interest in host-card emulation continuing to grow and SIM-based NFC rollouts in need of a boost, mobile operators and their global trade association, GSMA, are pushing for significant cuts in the cost and complexity of TSMs and lowering other hurdles that have discouraged service providers from provisioning their applications on SIM cards.

Broadcom Discusses Connectivity Chip Wins but Makes No Mention of NFC Following Q2 Results

U.S.-based Broadcom did not mention NFC in its recent conference call with analysts following release of its second quarter results, in which it announced cuts to its global workforce of 20% by exiting the baseband mobile processor business.

People on the Move: Group of Visa Vets Form Start-Up, Tapping NFC and BLE Technologies

A group of former top managers in Visa’s mobile program have formed a start-up that plans to use NFC and BLE to deliver coupons, rewards and other offers to consumers in stores, using the branded apps of retailers or other marketers.

Visa Offers New Details of Planned Tokenization Service

Visa Inc. has released a few more details of its planned tokenization service, which it announced last week as part of its Visa Digital Solutions “suite of offerings.”

Transport for London to Accept Bank Cards, NFC Phones on Underground, Other Transit Modes

Transport for London today announced it would launch acceptance for open-loop bank cards and other contactless payment on its heavily traveled London Underground and other modes of transit in September, while the UK’s largest mobile operator, EE, announced customers could begin to tap their NFC phones to pay fares at the same time.

Visa Announces Plans to Introduce Token Service as Part of Mobile Revamp

Jul 25 2014 (All day)

Visa Inc. announced Thursday it would launch a tokenization service in September, as part of what it calls its Visa Digital Solutions “suite of offerings.”

NXP Reports Higher NFC Sales, Offers No Hints on NFC-Enabled iPhone

Jul 30 2014 (All day)

NXP Semiconductors said sales in its emerging ID business–mainly made up of its NFC chips–increased by 22% in the second quarter, compared with the first quarter, and CEO Richard Clemmer insisted the chip maker’s secure element business would continue to remain a strong contributor.

Westpac New Zealand Launches HCE Trial, Snubbing Country's Planned TSM Platform

Westpac New Zealand has announced a small trial of host-card emulation-based payments, with plans to introduce the technology to customers early next year.