Much headway has been made recently in the world of mobile payments. Google Wallet, NFC, Square and other Mobile POS systems are making the smartphone the device on which smaller, personal transactions are taking place. However, the majority of people are still using physical checks to pay for larger items or services such as rent with checks that need processing time, carry fees, and are not always reliable. Jay Bhattacharya, the founder of Zipmark, spoke to PSFK about how he sees the ‘checkbook of the future’ developing.
What is ‘the checkbook of the future’ and how is Zipmark making it a reality?
Across all industries we’re seeing time and resources being wasted on something that should be streamlined and carefree — payment collections. We’re aiming to help people focus on their actual business by streamlining cash flow and decreasing the hassle (interchange fees, bounced checks) that comes with existing payments structures — this is what ‘the checkbook of the future’ can accomplish. We just announced the launch of our Developer Program, giving businesses and application developers access to an entirely new kind of fast and secure payment system for online and mobile transactions. Our platform brings sophisticated check-processing infrastructure directly to billers and their customers, enabling businesses to accept secure payments from any bank, thrift or credit union checking account without onerous fees or long delays. We charge 1% for each transaction with a cap at $5 regardless of the payment amount and offers secure, Check21 compliant digital checks. Our iPhone app is debuting at South by Southwest Interactive, and will enable users to make payments for items such as rent, fees or subscriptions directly from paper invoices via QR codes.
What are the challenges involved with getting merchants to sign up?
At Zipmark, we view merchants as users of our product, and as such we work with them to understand how our product can help their business. For example, if a small business proprietor wants to be able to collect from a client online, we can help them with that without having to get a merchant account or pay credit card or Paypal fees. The lower fees, faster settlement and the good funds model seems to resonate with billers and merchants. Also the fact that our payments are realtime, authorized checks provides immediate understanding of our transaction process unlike some of the alternatives that use stored value or intermediary accounts.
Zipmark works closely with businesses that are already servicing merchants as partners and collaborators. There is so much change happening in eCommerce and mobile commerce and payments is often part of a larger suite of tools that help business owners and managers. If you can get Zipmark from someone with whom you already do business, that works better from our perspective
Other than convenience and efficiency, are you planning on building any incentives (loyalty, discounting etc.) into the system to encourage people to use the system?
We have rewards and loyalty on our radar, but right now we feel that if we are the best way for a merchant to get paid, they are going to ask for Zipmark. One of our early test clients is putting “convenience” fees on every other way to pay except for Zipmark, which is driving a lot more adoption than any miles program would.
Are you considering offering any other services on top of the payments platform, recommendations etc.?
There are businesses that do a great job of creating those services and Zipmark secure digital check transactions may become a valuable data for them.
Alongside mobile tech, where do you see the payments space heading?
Mobile is a big change for the financial services space. I entered the industry when the prevailing attitude was that the Internet, as a whole, was going to be where the riff-raff would be so the industry was wrong back then. One trend in general is the overall control of payments going to where the actual business relationship is, between the payer and the payee. We see that with merchant funded rewards, stored value, etc. Major behavior changes such as NFC and P2P are going to take time and service providers will need to be reactive to what the market says. We are now living during the coming of age of the first generation of consumers who never went to a bank branch or questioned an online transaction, at Zipmark we’re planning so that we can be open to the changes that emerge.