Mobile payments sector heats up as PayPal, ANZ launch new online wallet tools

The micropayments sector is heating up, with PayPal offering SMEs a new method to collect payments online and ANZ teaming up with a new iPhone app that allows users to buy from restaurants with a new mobile wallet service.

The iPhone app, Plastic Fork, allows users to order food from restaurants without having to hand over their credit card details each time. Founder Anthony Gherghetta says both micropayments and mobile commerce will allow more SMEs to enter online retail.

“We’ve been exploring different options with iPhone apps, and with this one, we’ve already signed up over 300 restaurants. This type of mobile commerce is where the industry is moving,” he says.

The app allows restaurants to sign up to a directory, which is accessed by iPhone users who download the app. When they open the app, it gives them a list of takeaway food services they can order from.

Users don’t need to input their credit card details each time, and by teaming up with ANZ, Gherghetta says restaurants are freed of the burden of taking payment details for every order.

“This is where the industry is heading,” he says. “The concept of the mobile wallet, or being able to buy things straight form your phone, is growing. Whenever someone figures out the best model, whether that be PayPal or another company, it’s going to be huge.”

The concept of mobile commerce, or phones acting as a wallet, has grown in popularity over the past year. ANZ has been a significant player, recently releasing an iPhone app that allows users to transfer money using mobile numbers instead of account details.

But the concept is much larger in the United States. Square, a company started by Twitter co-founder Jack Dorsey, allows users to take credit card payments on iPhones through the use of a plastic peripheral.

Visa is running a trial in the United States where iPhone users attach a case to their phone that allows them to pay for products by waving the gadget over a card reader. Currently the New York Metro and McDonald’s are taking part in the trials, with a number of other users.

But the micropayment scene is also growing. PayPal overnight announced a new feature allowing users to pay for digital goods and content with a two-click solution. The system allows businesses selling any type of digital goods, such as games or some type of credit, to implement the system on their own site.

“The new solution offers PayPal’s competitive fee structure for micropayments, with pricing at 5% plus 5c for purchases under $12 – lower than the fees typically charged by payment processors in the digital goods industry,” the company said in a statement.

“Every time a customer purchases content, publishers and merchants get paid quickly, giving them fast access to their funds.”

The company has partnered with Facebook to show off the new system, while sites including Autosport and Justin.tv are using the system already by selling digital goods online.

But PayPal is also putting a huge emphasis on mobiles, with the company announcing the new Mobile Express Checkout feature. The feature allows users to remain logged in across a number of different apps to make purchasing easier and faster.

The mobile payments library will also allow developers to use preapproved payments for subscription-based services. And VeriFone, a mobile payments company competing with Square, also announced it will be the first manufacturer to work with PayPal to offer payments on its own system.

Gherghetta says these innovations all allow SMEs to get into the mobile space easier and quicker, and he says businesses should start thinking about how they can implement these features on their own sites.

“This movement is going to be absolutely huge. The business model of both mobile and micropayments is helping SMEs move online. Demand for mobile apps is also going through the roof, and it’s giving SMEs easier access to online commerce.”

“Whether you’re looking at sites such as Apple or Amazon or even sites for smaller businesses, you want a one-click order solution where your credit card numbers are stored. This digital payments process, both online and in mobile, is allowing that to happen.”