Entries in mobile payments (4)


Venmo seeks to simplify peer-to-peer payments (simply, paying your friends back)

I write more I O U notes than I care to admit. I just never have cash and the coffee shop in my buildingSadly, not a joke doesn't accept credit card for purchases under $5 (a practice that violates their terms with the credit cards, but that I support). While I'm always good for the $3, surely there is another way. A way to avoid the awkwardness of buying a friend lunch when he forgets his wallet, and then promptly forgets your generosity. A way to avoid PayPal'ing a friend money for buying your tickets to a conference and have 3% taken off in fees.

Square will revolutionalize merchant payments. But for peer-to-peer paybacks, I'm excited about Venmo, a 100% free way for individuals to text each other payments. Users can deposit money directly into their Venmo account or have it pull from their bank. So instead of writing I O U $2.50, I can text Venmo "send Anita $2.50". We're immediately settled up and transactions costs are 0. Lovely.


Mobile giving at its most compelling: text your donations to Haiti

Usually I write about the benefits of mobile payments in terms of the great convenience or the interesting social experiments, but today's tragedy in Haiti provides the most compelling use case so far: through mGive, you can immediately text your donations to relief organizations on the ground.

To donate $10 to Red Cross International Relief, simply text Haiti to 90999.

Flickr credit: Glasshalffull91


Finally! A US mobile payment system

I've been longing for a while to use my cell phone instead of my credit card to, say, make small micro-payments or pay back my friends for lunch. Seemed crazy for such a useful service to exist ubiquitously in Africa, but be practically non-existent in the United States.

So I am thrilled to see Twitter's Jack Dorsey and others launch Square, a mobile payment company that is "focused on bringing immediacy, transparency, and approachability to the world of payments."

As credit card terms become more and more unmanageable for merchants -- to the point where I'm seeing more smaller stores either refuse to accept them or post minimum purchases -- this is a great relief. I am glad for the convenience, but for merchants, it is a great cost savings.

Paying at outdoor markets, small coffee shops, even eventually friends could be revolutionized by this service. It's one of the best examples that I've seen in a while of technology opening up free markets.

Flickr credit: Jerrold


Mobile Payments for E-commerce and P2P Lending -- Cut out the bank

One of the most exciting trends in banking and commerce is the rise of mobile payments. The effectiveness of mobile payment solutions, where individuals can purchase items directly through their cell phones without needing to go through a bank, is well-established in Africa where it has helped bring millions of unbanked citizens into the formal economy.

The United States is now getting in on the action. A few days ago, Amazon announced its new Mobile Payments Service, a one-click payment option to purchase items without needing to enter in any additional payment or shipping information. Boku launched earlier this year and facilitates micro-payments, especially for virtual goods for games like Mafia Wars, through cell phones.

Other notable examples:

  • Absa, a South African bank, just won the award for "Most Innovative Bank in Africa" for its cutting-edge services including Cash-Send, a card-free banking solution, as well as banking the disabled.
  • Splash Cash is beginning supplant Western Union as the preferred method of transfering funds between individuals in Sierra Leone. Customers can purchase credits on their phone and transfer money directly to another phone without ever touching a bank. And with a fee of only $4 for a $300 transfer and the ability to cost-effectively (only 16 cents) transfer sums as low as $1.50, the price gouging of Western Union may become obsolete.
  • We've covered earlier MGive, which lets lets you text money immediately to your favorite non-profits.

Finally, MoneyAuction, a Korean P2P lending company is now allowing borrowers and lenders to seek and bid on loans directly from cell phones. This seems like a great direction for U.S.-based p2p lenders to take. The infrastructure isn't quite there yet to support it, but with their emphasis on cutting out the bank, p2p lending companies could take the concept one step further by enabling mobile loan payments and lending.

Flickr credit: Lorianne DiSabato