Alt Payments Archives - Page 3 of 3

P2P Payments: CashEdge’s POPmoney Spotted in the Wild at First Hawaiian Bank

By Jim Bruene Posted on December 9, 2009
Categories: Alt Payments, Bill payment, CashEdge, Launches, Mobile Payments, P2P Payments

When CashEdge demo’d its new person-to-person (P2P) payment solution, POPmoney, at Finovate in September (video here), they said they expected four clients to be live by year-end. It looks like the first one is there, or almost there.

First Hawaiian Bank has a lengthy POPmoney FAQ posted on its website (see screenshot below). Pertinent details on the new POPmoney service include (refer to full text below):

Cost is $1 per transaction
Users can send money via email address, mobile phone number, or directly into the recipient’s bank account (if known)
Online banking customers will find it in the Transfers section under a tab entitled Send Money
P2P payments are limited to $5,000 per month subject to a daily maximum of $1,000 via email/mobile or $2,000 transferred directly to another bank account
Payments can be scheduled up to one year in advance

For more on the P2P payments market, see our latest Online Banking Report, published 15 minutes ago: Making the Case for Person-to-Person Payments.

First Hawaiian Bank’s POPmoney FAQ (link; 8 Dec. 2009)

FAQ text:

What is “POPmoney”?
“POPmoney” is a feature of the FHB Online® banking service that lets you send money to someone electronically via their email address, mobile phone number, or directly to their bank account. Payments to someone’s email address or mobile phone number are accompanied with a personalized message letting them know that the funds are available for electronic deposit to wherever they choose, while payments to someone’s bank account are deposited automatically.

How much does POPmoney cost?
Sending money via POPmoney costs only $1.00 per transaction.

How do I sign up for POPmoney?
POPmoney is available to customers through the FHB Online service and can be accessed via the “Send Money” tab within the “Transfers” section. If you are not currently enrolled for FHB Online, visit www.fhb.com and click on the Online Banking “Enroll” button in the upper left-hand corner of the screen. If you are already enrolled for FHB Online, sign onto FHB Online, go to the Transfers section, and then click on the Send Money (Personal Only) link. Follow the three-step sign-up process:

Step 1 POPmoney Agreement – Accept the FHB Online POPmoney amendment.
Step 2 Contact Information – Your email address and mobile phone number are required as part of the sign-up process. You will need to verify the email address we have on file is correct. If it is incorrect, please close the window and click “Update Email Address” within the Customer Service tab to update your email address. After confirming your email address, return to the “Transfers – Send Money (Personal Only)” link and you will also be asked to provide a mobile phone number as part of the sign-up process.
Step 3 Email/Mobile Phone Validation – We will send verification codes to your email address and mobile phone. Please check your email and your mobile phone for these codes and enter them in the boxes shown on-screen to complete the sign-up process.

Once you’ve completed the steps above, you will receive a confirmation message indicating that you have successfully signed up for POPmoney. Click “Continue to POPmoney” to start using the service.

Who can I send money to?
You can send money to someone just by knowing their mobile phone number or email address. The person receiving the notification will be able to deposit the money to any personal checking, savings, money market checking, or money market savings account at FHB or nearly any other U.S. bank. You can also send money directly to someone else’s bank account if you have their bank routing and account number information.

How does the recipient receive and deposit funds?
If you are sending money to a mobile phone or email address, the recipient will receive a notification with a personalized message indicating that you have sent them a payment. The recipient has two ways of depositing the funds:

If the recipient is a First Hawaiian Bank customer, they can deposit the funds into their account via the FHB Online service. Upon enrolling, or if the recipient is already enrolled for FHB Online, they can click on the “Send Money (Personal Only)” to access the POPmoney feature. Any payments that have been sent to them will be listed under the “Incoming Payments & Alerts” tab. They can then select an account to which to deposit the funds. They can also designate whether future payments should be automatically deposited to this account.
If the recipient is a not a First Hawaiian Bank customer, or would like to deposit the funds into a non-FHB account, they can visit www.popmoney.com/FHB. They will be prompted to provide their mobile phone or email address along with their bank account information for the payment to be deposited.

Can I send money internationally?
No, you can only send money to individuals via their accounts within the U.S.

What is the maximum transaction amount I can make via POPmoney?
The maximum daily amount allowed for POPmoney transactions is the current available balance in the source account (plus any available credit in an associated Yes-Check^SM account if applicable) up to the daily limit mentioned below, whichever is less. This includes any single transaction or the total amount outstanding or “in process.” For additional information, see below:

Sending Money to Bank Account

Maximum Amount

Daily

$2,000.00

Monthly

$5,000.00

Sending Money to Mobile or Email

Maximum Amount

Dail
y

$1,000.00

Monthly

$5,000.00

Can I set up recurring or future-dated transactions?
Yes, POPmoney transactions may be scheduled up to 365 days in advance of the date the transaction is to be made. Automatic recurring transactions may also be scheduled for substantially regular intervals (e.g., monthly) in the same amount between the same two accounts. You can schedule recurring transactions to be made weekly, every other week, twice a month, monthly, every four weeks, every other month, quarterly, twice a year, and annually.

How far in advance can I schedule a transaction?
You can schedule a POPmoney transaction up to one year in advance.

When are POPmoney transactions processed?
Transactions will be processed on the date you specify up to a year in advance. Transactions will take approximately three business days to process. Transactions scheduled to process on a weekend or holiday will be processed the previous Business Day.

What is the cut-off time to submit a transaction?
The cut-off time for submitting transactions is 7:00 p.m. HT each Business Day. Transactions submitted after 7:00 p.m. HT or on weekends or holidays will be processed the next Business Day. A Business Day is every calendar day except for Saturdays, Sundays, and bank holidays.

What is the cut-off time to change or delete upcoming transactions?
The cut-off time to change or delete an upcoming transaction is 7:00 p.m. Hawaii Standard Time the previous Business Day prior to the send date.

When does the transaction get debited from my account?
The transaction debit request is initiated on the “send date” but will not post against your account for one to two days.

What happens if I set up a transaction but do not have sufficient funds in my account on the “send date?”
If, on the “send date,” there is insufficient balance in your account to make a transaction you authorized, we will delay the transaction and try again on the next Business Day. If there is still insufficient balance to make the transaction, we may either refuse to pay the item, or we may make the transaction and overdraw your account. In either event, you will be responsible for any non-sufficient funds (“NSF”) or overdraft charges that may result.

How many people can I add to my list of contacts?
You may add up to a total of 50 contacts.

I used to send money to third parties via the External Transfers function. What will happen to this information?
As part of introducing POPmoney, we have migrated your third-party information and activity from External Transfers to POPmoney. This includes contacts or accounts, as well as upcoming and previous transactions. Categories for previous transactions will not be migrated and will need to be re-defined.

How do I disable POPmoney?
You may disable POPmoney by calling us at 643-4343 (1-888-643-4343 from the Continental U.S., Guam, and CNMI). Please note that disabling POPmoney will also disable your access to External Transfers.

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American Express Jumps on the Alt-Payments Bandwagon in a Big Way; $300 Million Acquisition of Revolution Money

By Jim Bruene Posted on November 19, 2009
Categories: Alt Payments, American Express, Credit/Debit Cards, Mergers & Acquisitions, Revolution Money

Frankly, I haven’t got my head completely around the latest acquisition in the alt-payments space (and I’m not the only one). I know that it makes my analyst life more interesting, but not sure what it means to the competitive landscape. Scott Loftesness over at Glenbrook Partners has the best analysis I’ve seen (also read the comments).

I’ll break it down here. Revolution Money has two products:

1. RevolutionCard: Alt-payment card for use at the point of sale, both online and in-store.(see inset below from SeattleLuxe.com where RevolutionCard logo is right below Visa; full screenshot below). Unique PIN-based card with no account number or name (see below).

2. Revolution MoneyExchange: A person-to-person payment service.

Neither product appears to be very large. In the Q&A of the announcement webcast (press release), Revolution Money chairman Ted Leonsis said the company had signed 8,000 customers per day during a 90-day marketing test about a year ago. In total, it registered about 400,000 consumers (note 1). They also said they’d built merchant acceptance to about 1 million locations.

The company declined to disclose the number of cardholders, but mentioned that each of its dozen marketing partnerships had brought in two or three thousand good cardholders. Leonsis said that given the current credit environment, they elected not to expand the cardholder portfolio, instead “doubling down” on platform features, such as ATM acceptance (note 2).

But according to traffic figures from Compete, few Revolution Money customers were actively using its services. The P2P service, MoneyExchange, was the most-visited of the company’s three sites with about 20,000 unique visitors last month, but that was down from 70,000 a year ago (during the marketing test). On the other hand, the Revolution Card volume was similar, just under 20,000, but up more than 50% year-over-year (see chart from Compete below).

Compete: 18 Nov 2009, link

American Express opportunities
On the call (replay here through next week), American Express CEO Kenneth Chenault outlined seven opportunities it would pursue when the transaction closes early next year. Notably absent, person-to-person payments:

1. Reloadable prepaid products for new segments

2. Compete with other alternative payment companies (aka PayPal)

3. Payment products in social media services

4. Mobile payment offerings

5. International markets

6. Offer through banks that issue American Express cards

7. Pin-based debit offerings

During Q&A, Chenault emphasized how the acquisition was all about getting the Revolution Money platform/engine to allow AmEx to do things faster and for a lower cost. There was little talk of RM’s brand, customers, or merchant base. The biggest discussion, during Q&A, was about reloadable prepaid cards.

My take: American Express purchased a platform they hope will allow it to get various new features/products to market faster and at lower costs to help head off total online-POS domination by PayPal. In addition, it acquired a proven team and management duo, and kept the whole works out of the hands of potential competitors such as Discover Card, Barclays, and others. While no one on the outside can understand the assumptions in the make vs. buy analysis, given its track record, American Express should be able profit from this $300 million IT investment.

Online cards are sprouting new payment options
SeattleLuxe offers ten choices plus a link to pay by check (18 Nov 2009)

Notes:
1. This is a registered user count, not necessarily a user of the service. Many of the new customers came for the $25 signup bonus or just to kick the tires. There was no cost or obligation to register.
2. On the call, Revolution Money said that 80% of ATMs accept their card.

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Happy 10th Birthday PayPal!

By Jim Bruene Posted on November 19, 2009
Categories: Alt Payments, Best of the Web, PayPal

In preparation for our upcoming report, I re-read our first report on P2P payments published almost 10 years ago to the day (29 Nov 1999). Although written early in the game, I was very impressed with PayPal, a service launched two weeks earlier (15 Nov 1999) by Confinity, the original name of its parent company.

We’ve made our share of incorrect predictions over the years, but this one we got right (note 1), annointing PayPal with one of the first OBR Best of the Web awards. Here’s our take from that original report, when PayPal was available as a payment option on just nine eBay auctions:

(PayPal) is not as well known as BidPay….but as soon as (eBay) participants discover (PayPal) is free and real-time, it should catch on quickly.

PayPal was originally developed as a payment mechanism between Palm Pilots, which explains the “beam money” call-to-action on top of the original user interface (below). But I wasn’t a Palm user, so what got me excited about the service was the use of the email address to facilitate payments:

Much of (PayPal’s) press coverage has focused on the Palm application…(but) it’s the email-payment program that has the huge potential.

The rest, as they say, is history.

PayPal “send money” interface at its 1999 launch (15 Nov 1999)

PayPal “send money” today (19 Nov 2009)

Note:
1. And truth be told, we predicted that PayPal would need to hook up with an existing payment player to get past trust issues. But luckily for them, the extremely deep-pocketed VCs in the bubble days floated PayPal a massive amount of cash so it could buy its way into the wallets of consumers.

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Quotes: Mercantile Bank on Using PayPal for P2P Payments

By Jim Bruene Posted on November 11, 2009
Categories: Alt Payments, Mercantile Bank of MI, Mobile Banking, Mobile Payments, PayPal

The biggest surprise of the year in the world of alt-payments is PayPal’s newfound reach into banking circles as evidenced by their agreements with S1, FIS, and FirstData announced at last week’s Retail Delivery conference.

But a huge question remains: Will banks play ball with PayPal or will they provide the same functions via home-grown solutions or non-PayPal alternatives such as CashEdge, Fiserv, or Visa/MasterCard?

I don’t think anyone has that answer yet. There are simply too many variables. But if you believe there’s no way a bank would use a “powered by PayPal” solution, read this quote by Mercantile Bank of Michigan’s CIO, who plans on launching the S1/PayPal person-to-person mobile service next year (note 1):

“(PayPal) is a network, it doesn’t scare me at all. They’re never going to steal significant deposits out of our bank and keep [them] in PayPal accounts. Visa and MasterCard probably look at PayPal as the enemy, and they probably should, but that’s their problem, not mine.”
— John Schulte, CIO Mercantile Bank of Michigan in a
Nov. 10 article from Digital Transactions

Note:
1. You might remember Mercantile Bank from our May post lauding its fee-based consumer positive-pay service.

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SunTrust Partners with Moneta to Test the Alt-Payment Waters

By Jim Bruene Posted on November 3, 2009
Categories: Alt Payments, BAI Retail Delivery, PayPal, SunTrust

I’ve been waiting 10 years to write this story. A major U.S. bank has finally dared enter the space PayPal has all-but-owned since the first part of this decade (see note 1, 2): secure, non-card-based payments at the point-of-sale, which do not require handing over private info to the merchant.

Yes, Bank One, Citibank and Wells Fargo all failed at person-to-person payments in 2000/2001, but this is much different. Those were payment services between individuals, not a point-of-sale option like PayPal, Google Checkout, and most recently, Amazon.com.

SunTrust’s partner Moneta is an Atlanta-based startup that debuted its alt-payment system at FinovateStartup earlier this year (video here). The joint effort was announced at BAI Retail Delivery in Boston earlier today (press release).

The program is already being tested on a large group of SunTrust online banking customers who recently received an email offering a $10 cash-back incentive to make a purchase of $50 or more from one of the handful of merchants currently accepting Moneta-powered ACH payments. The biggest merchant is Delta.

Moneta’s appeal to merchants is relatively straightforward: Incremental sales from customers unwilling or unable to pay via credit card online AND reduction in interchange costs by moving card-based transactions to Moneta transactions, with much lower interchange.

For banks, the business case is not as obvious. The hope is that Moneta-issuing banks share of interchange revenue will more than offset what the bank might lose in card-based interchange. While that may turn out to be the case, the more compelling benefit for banks is the brand and relationship value of offering a new payment choice with more perceived security and privacy advantages. There are also intriguing possibilities to add other revenue-producing value to those transactions.

Last year in my notes from the BAI conference, I named Moneta as the “most audacious business plan.” Right now, it’s too early to say whether Moneta can become a legit competitor to PayPal. But with SunTrust on its side, that audacious plan is MUCH closer to realization.
Notes:
1. For the historical perspective, see our first report on person-to-person payments (published, Nov. 1999).
2. In somewhat-related news: A year after PayPal CEO Scott Thompson made a keynote appeal to bankers at last year’s Retail Delivery, FIS and PayPal announced a partnership today (press release) as did S1 (press release) that could bring PayPal-powered peer-to-peer payments to hundreds of financial institutions.

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Donors Choose Checkout Includes Amazon Payments along with Facebook and Twitter Integration

By Jim Bruene Posted on October 13, 2009
Categories: Alt Payments, Amazon.com, Facebook, Giving back, Twitter

I love how the Internet removes friction from everyday tasks, especially payment-related ones. And one of the great success stories of recent years, beginning with Hurricane Katrina relief in August 2005, is how easy it is to make charitable gifts online.

I’ve used the Red Cross site several times. It gets the job done, but not with the flair and superb user experience of Donors Choose (note 1).

Thanks to Fred Wilson, blogging at A VC, I contributed to the Social Media Challenge last week and got a first-hand look at Donors Choose. The simple checkout process has three features that I’d not seen before:

Amazon Payments as a payment choice (along with PayPal, credit card, or check; first screenshot)
Automated Facebook wall post integration (second screenshot)
Automated Twitter posting with two options:
— allow Donors Choose to Tweet a thank-you to you referencing your @twittername
— provides a template for you to make a Tweet from your own Twitter account

If you want to see a state-of-the-art checkout system in action, and support kids in the classroom, check out Donors Choose.

Or if you are looking to add a charitable-giving feature to your banking site for the holidays, you can easily create your own giving page at Donors Choose and run a widget on your website tracking the campaign’s progress (see inset). You can choose which projects to support so long as they fall within the nonprofit’s mission of “helping students in need.”

Donors Choose cart with Amazon Payments and PayPal integration (13 Oct 2009)

Facebook wall post integration
This screen popped up after I checked out

Twitter integration

Donors Choose shout-out page on Twitter (link)
Note: First Tweet was Sep 29. Have done 342 since then (through 13 Oct 2009).

Note:
1. My first donation via Amazon Payments failed because I accidentally used a canceled credit card number. And evidently there is a bit of a bug in the feedback loop to the Donors Choose site. I got an error message, but when I clicked “next” to re-enter the payment, the site transferred me out to the thank-you page and I was unable to go back and re-do the transaction. I had to start all over again, and now the site shows that I’ve made two donations instead of one.

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Straight out of Twitter: BillMyParents Launches

By Jim Bruene Posted on March 27, 2009
Categories: Alt Payments, Credit/Debit Cards, Launches, Student Banking, Twitter, Youth market

I’ve mostly just observed the Twitter phenomenon, following a few people and seeing how banks and credit unions are using it (see my previous post for financial institutions on Twitter). However, I’d not fully embraced Twitter either as a publishing device or research source. The 300 or so RSS feeds, emails and news items that cross my desk each day seemed like plenty of intelligence to sift through.

But now, I’m reconsidering my priorities after learning about an interesting new alt-payment company BillMyParents from Twitter activity (see notes 1, 2).

How it works: BillMyParents is a new service from IdeaEdge’s Socialwise (press release). The service is primarily designed for kids to shop online. They select what they want, then at checkout, redirect the bill to their parents via an email alert to PC or mobile phone. Parents login and complete the payment process at their convenience using MasterCard, Visa, Discover Card (no American Express; see third screenshot below). Card info can be stored for one-click future approvals.

The company charges a $0.50 transaction fee for each purchase. But like PayPal, the real money will be made when the company pushes purchase transactions through the ACH system.

Currently, BillMyParents is selling prepaid gift cards from its site as a proof-of-concept. I tested it yesterday and everything seemed to work as described (see second screenshot below).

The opportunity: The service reminds me of the unmet need that PayPal filled nine years ago. Purchasing at eBay was a major hassle due to the lack of online payment capabilities. Kids have similar problems when trying to buy things online.

The service could also be adapted to other situations where one party does the shopping but wants someone else to authorize payment such as small businesses, nannies, or even spouses. It could also be used for extra security when the shopping is done in a non-secure environment such as public terminal and payment is redirected to a more secure device, such as your mobile phone.

Like any alternative payment, BillMyParents requires the merchant to add the option to its ecommerce platform and consumers to set up accounts. Both of those are time-consuming and face the chicken-and-egg dilemma, i.e., it’s hard to attract merchants without a substantial user base while its difficult to add users without merchants.

Bottom line: This is a winning idea. The massive discretionary purchasing power of teens and pre-teens is a tempting target in this difficult retail environment. And financial institutions, or their payment partners (e.g. Visa, MasterCard), looking to differentiate themselves with the youth market, could jumpstart the program. Or more likely, PayPal and/or Amazon will dive in, either acquiring BillMyParents outright, or building their own version(s).

BillMyParents homepage after setting up an account (26 March 2009)
Note: Split login screen for kids (left) and parents (right)

Proof-of-concept: Gift card purchase (26 March 2009)

Parent’s approval screen (26 March 2009)

Notes:
1. Thanks to Frederic Baud (@fredericbaud) who was the first in my network to Tweet about BillMyParents; and to Glenbrook’s Scott Loftesness (@sjl) who’s retweet is actually what caught my eye.

2. BillMyParents appears to have grabbed its Twitter page name (@billmyparents), but it’s not yet active.

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Money Link from the University of Wisconsin Credit Union Makes Electronic Transfers Simple (like they should be)

By Jim Bruene Posted on March 12, 2009
Categories: Alt Payments, Funds transfers, Mobile Banking, US Bank, UW Credit Union

Financial institutions vary considerably in how easy they make it to move money in and out of bank accounts.

On the one extreme is U.S. Bank, which still requires a retail customers to visit a branch to initiate an electronic payment (note 1). Plus, if you come in after the wire transfer deadline, 2 PM I believe, you can set it up to go out the next day, but you still have to call back and reconfirm before 2 PM the following day. When asked why they needed a phone call after I’ve already appeared in person, shown my ID, and signed multiple documents authorizing the transfer, they responded in all seriousness, “to make sure you are still alive.”

Then there’s University of Wisconsin Credit Union, who not only assumes its members are alive, but also wants to keep them satisfied.

The credit union’s novel Money Link service allows anyone to send money to a UW CU member via an email-enabled system similar to PayPal but free of any fees and branded by the CU. The service can also be accessed via UW CU’s mobile banking.

Transfers from outsiders take 3-4 days for the ACH items to clear. But member-to-member transfers occur in real time. It’s a great way for students to get money from mom and dad in time to thwart that Monday morning overdraft.

The CU also supports full inter-institutional account-to-account transfers online. There is no cost to move money into UW CU, but there is a $2 fee for outgoing transfers.

Members who can’t wait for the 3 to 4 days for an ACH to clear, can elect the the Express Service that offers one-day turnaround for $10. The Express service has a $2,000 limit where the Standard Service can be used up to $10,000 (see inset).

Bottom line: This is the type of transfer service most consumers expect from their bank or credit union. It’s amazing that it’s still not supported at many financial institutions, including some of the majors.

Note:
1. Referring to wire transfers here initiated in the Seattle area. There could be other procedures in other areas of the bank’s footprint. Also, customers can CheckFree-powered online bill pay to pay any U.S. resident or business within 5 days.

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WaMu’s New P2P Funds Transfer Service, WaMu Send Direct

By Jim Bruene Posted on December 10, 2008
Categories: Alt Payments, Epayments, Washington Mutual

When’s the last time you Googled something and found nothing? Evidently WaMu’s innovative P2P funds transfer service got lost in all the “excitement” this year and word never got out.

Luckily, I was seated beside Aliaswire (see note 1) SVP Keith Smith at dinner in Orlando two weeks ago. His company powers WaMu Send Direct, a service for P2P payments service for WaMu credit card holders, launched earlier this year at <wamusenddirect.com>.

WaMu Send Direct uses a variety of methods to transfer funds with as little hassle or with as much privacy as desired (see note 2). Cost to the sender is 2% of the amount sent with a $2 minimum. Recipients pay nothing.

This makes for a good pricing model for such things as parents sending money to a child, but not so good for consumer-to-business payments, UNLESS the consumer can avoid a late payment and/or finance charge (aka, expedited payments).

In addition to the 2% fee, the amount sent is posted to the WaMu credit card as a purchase and is subject to the prevailing APR and presumably an interest-free grace period if applicable (see note 3).

Transfers all come out of a WaMu credit card, but they can go to the recipient in any of the following ways:

Directly to a checking/savings account if the sender has the bank account info of the recipient
Directly to a debit card, ATM card, or credit card if the sender has the recipient’s card number
To the recipient’s phone or email address, requiring the recipient to call or log in at WaMu to claim the funds by providing bank account info; however, on subsequent transfers the recipient would not be required to contact WaMu so long as they signed up for Automatic Claim

Transfers can be initiated via:

Website <wamusenddirect.com>
SMS message to specific short code
Telephone call to a toll-free number

It’s a cool service. It will be interesting to see if Chase continues the service as they assimilate the WaMu credit card portfolio.

WaMu Send Direct Homepage (5 Dec 2008)

Note the text message box at the bottom offering to text a bookmark to the user.

Notes:
1. The name comes from the ability for a user to transfer funds (aka “wire”) to other users via “alias”, e.g., email address or mobile phone number.

2. Despite my longstanding policy of avoiding flow charts in NetBanker, here’s a schematic of how Aliaswire’s mPay works. mPay is the service that WaMu has private-branded as WaMu Send Direct.

3. The Terms & Conditions states that the payment is considered a “purchase,” which sounds like it would qualify for an interest-free grace period on accounts not currently revolving; however, the terms did not specifically say that.

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Highlights from BAI Retail Delivery 2008

By Jim Bruene Posted on November 21, 2008
Categories: Alt Payments, BAI Retail Delivery, Conferences

BAI’s Retail Delivery Conference is an annual rite for bank tech geeks from around the world. Although attendance was down 20% or so from last year, causing some grousing on the trade-show floor, I thoroughly enjoyed it.

Here’s my personal list of highlights from the show (see note 1).

The Netbanker awards:

Most audacious business plan: Alt-payment startups Moneta and sister company Acculynk which are looking to disrupt online payments at the point of sale
Most likely to succeed: mobile anything
Biggest “wow” factor: Cardless ATMs by Wincor Nixdorf
Best demo of something that actually exists: Bank of Montreal’s demo of its new branch locator using Microsoft Virtual Earth (shown at the Microsoft’s booth)
Coolest solution looking for a problem: Microsoft Surface
Product most likely to be used in our company: Bankserv remote deposit integrated with QuickBooks
Product least likely to be used in our company: Wii banking from Wincor Nixdorf (but it’s very cool)
Best presentation: Don Tapscott, author of Wikinomics and Growing Up Digital
Best buzzword comeback: Push banking (mobile apps, widgets, alerts)
Best trade floor freebie: Free espresso from ClairMail
Best financial screenshot during a keynote: PayPal CEO Scott Thompson showed PayPal Mobile from Chase Bank, a pilot program running on several college campuses (Ohio State), where Paypal Mobile is bundled with banking services from Chase Bank
Worst financial screenshot during a keynote: Don Tapscott used Zopa USA as an example of a promising new Web 2.0 financial company (Zopa pulled out of the U.S. market last month)
Biggest jinx: Second Curve Capital CEO Tom Brown, who Tuesday afternoon explained why he is so bullish on bank stocks; the NASDAQ bank stock index proceeded to drop 200 points (10%) over the next two days (note 2)
Most amazing stat: In his keynote, CEO Arkadi Kuhlmann said ING Direct (USA) had originated more than 100,000 mortgages worth $36 billion, and initiated foreclosures only 15 times
Best time: Dinner with Trey Reeme and the gang from TDECU who are not only some of the nicest people you could ever meet, but also provided absolutely stimulating conversation and some great laughs

Best of show: Drum roll please. After dozens of amazing conversations over three days, the company that most intrigued me is alt-payments startup Moneta (note 3).

Notes:
1. I visited with only a couple dozen of the 300 or so companies in Orlando, so comments here are not meant to be an overview, just the highlights of my experience. As usual, I spent most of my time looking for new ideas and ended up spending half my time talking to mobile providers.
2. To his credit, Mr. Brown did not say bank stocks had bottomed; in fact, he said they could very well go lower. But by this time next year, he expects a substantial turnaround. It was a great presentation.
3. Moneta didn’t have a booth, but board member and investor Ashish Bahl was in attendance and briefed me on his firm. We’ll provide more details on the company later.

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Privier Launches ATMsend, a Promising Idea that Needs Banking Partners

By Jim Bruene Posted on November 7, 2008
Categories: Alt Payments, Epayments, Launches, Mobile Banking, Mobile Payments

I've communicated with Privier founder Charles Polanco a number of times over the years. He's a Wachovia alum who's been working on a financial startup for several years. The company launched a suite of payment services on Oct. 16 that aims to get the plastic card out of the ATM business (press release).

Privier's value prop is straightforward and compelling: Enable money transfers from any device at any time with the cash delivered through the worldwide ATM network.

The system initiates transfers in three ways:

ATMsend: ATM to ATM
iTransfer: Web to ATM
mPayment: Mobile phone to ATM

In Privier's model the ATM card is replaced by a one-time authorization code that recipients key into the ATM to withdraw transferred funds.

Analysis
From a usability perspective, it's a great idea. After all, what's not to like? Consumers need to send cash. ATMs have cash. Why not let folks authorize a remote ATM withdrawal from the comfort of their own home or office. A proposed fee in the $7 range beats most alternatives for long-distance money transfers.

However, from a practical standpoint there are two massive roadblocks to overcome:

Retrofitting ATMs to accept a keyed-in code instead of a mag stripe for authentication
Convincing banks to add ATM-transfer capabilities to Web, mobile and telephone services

It will likely take an organization the size of Visa, MasterCard, or Bank of America to pull this off. To ensure that those behemoths work with it, Privier has a portfolio of patents pending on the business process.

What it means for Netbankers
It may take decades, but eventually, the Web married to mobile will eliminate the plastic debit/credit card; however, unless you are a major bank or payments company, this isn't likely anything you need worry about for a number of years.

A better short-term solution for smaller financial institutions is to enable P2P funds transfers using PayPal so you can send money to anyone with a PayPal account (see note 1).

Privier's Web-based interface for sending cash to an ATM (5 Nov 2008)

Note:
1. See our latest, the Online Banking Report 2009 Planning Guide, for more info on project priorities for this year and beyond.

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