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The mobile hotspace just got hotter

We all know the story of Square, or we should by now, but times are getting interesting for them.

Not only challenged by PayPal, whose recent launch of PayPal Here brings proximity payments to the world, they are also being challenged by suppliers like NCR, who are also getting in on the act with dongles and decent merchant accounting apps under the brand of Silver.

Over here, Square has spawned a whole raft of lookalikeees including iZettle, mPowa and more, but the models are different.

iZettle has struggled to get the right terminal out there, as Chip & PIN is more challenging and costly than magnetic stripe payments, whilst mPowa are focusing upon empowering banks to engage merchants in their mobile payments revolution.  

This is why mPowa questions the Square and iZettle models, saying that if you seek small merchants then the volume of transactions is too low to be a sustainable business model.

It would certainly be true that if 90% of your clients only make one transaction a month of low value payments, then the model is questionable.

However, I am sure that Square and pals would refute such critique by claiming that the long tail of payments creates enough volume to be profitable.

It certainly seems that way, as there are a whole range of other companies competing in this space such as PayaTrader, Intuit with GoPayment, Bancard with PayAnywhere, Verifone, Payleven and Sumup all noteworthy.

All in all, this is a hotbed space for merchant inclusion through mobile, a little bit like banking the unbanked via mobile.

Oh, and the reason for writing this today by the way, is that I just caught sight of yet another pretender to the mobile merchant throne: Worldpay.

Worldpay launched Zinc last week, and this is a Chip & PIN version of Square.

Zinc

Now this could pose a serious offer, as processors offering merchant payment terminals for mobile direct is a real capability that is required.

This is why Zapp from VocaLink is interesting, enabling easy payment by mobile using bar codes.

Equally, bearing in mind that Visa invested in Square and MasterCard in iZettle, it would therefore be interesting if they offered these capabilities direct.

Why wouldn’t they?

Because they would be competing with so many of the service providers on their network, although I do note that Square brethren from MasterCard and Visa do exist.

MasterCard has MasterPass, an app that displays bar codes to the merchant for payments, whilst Visa offers Paywave which they are investing heavily in for contactless mobile.

All in all, the mobile hotspace just got hotter.

 

About Chris M Skinner

Chris M Skinner
Chris Skinner is best known as an independent commentator on the financial markets through his blog, the Finanser.com, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal’s Financial News. To learn more click here...

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