Mobile Payments

Removing Mobile Payments Friction — Across Channels

It’s estimated that online merchants lose $147 billion as a result of transactions that consumers abandon before completion due to friction in the checkout experience.

And a lot of that, of course, has to do with mobile checkout friction.

According to comScore statistics, 60 percent of all online retail browsing happens on tablets and smartphones, but this translates to only 15 percent of all eCommerce sales.

And that’s the challenge online merchants face today: the gap between mobile browsers and mobile buyers’ conversions. One solution in the market, Minkasu, uses its mobile-focused digital checkout solution to provide online merchants with an easier way to enable faster, frictionless consumer checkout.

After all, according to Minkasu CEO Anbu Gounder, if consumers are already carrying around a smartphone, why not use it as an authentication device itself? Gounder believes that using the smartphone as an authentication device to make a payment on any device, any channel, anywhere, is a compelling value proposition.

Of course, the mobile payments space is crowded, and Minkasu is a small name in a big pond of players. However, Gounder believes Minkasu’s seamless user experience, across all channels, without a need for a username and a password, along with its patented security technologies, gives it an edge over other solutions.

“We enable simple and secure mobile payments and, in the process, reduce the friction significantly across all channels,” Gounder said. “We reduce friction significantly.”

An additional edge is its ubiquity; it is OS-agnostic and device-agnostic. It is not specific to any network, bank or merchant, which Gounder believes gives it a leg up on the competition. Through this, he believes Minkasu can deliver merchants and consumers exactly what they are looking for: security patents combined with its simple, mobile-focused checkout button.

And it works online via desktop, laptop, tablet or smartphone with a little green button at checkout that reminds consumers that mobile payment is a fast and secure option. It’s also payments platform-agnostic, since it doesn’t require NFC to enable payments.

Of course, Minkasu isn’t the only player in the mobile pay market aiming to reduce friction, but Gounder believes that its four security patents give it an edge, which ensures consumers and merchants that their payment credentials are safe.

Instead, Minkasu’s security technologies make the payments happen without storing credit cards. Its split-card technology takes a credit card number, randomizes it and then splits into two random parts. One part is stored on the phone, and the other is stored in the cloud. A fingerprint triggers the algorithm that brings back the card number for a fraction of a second to make the payment happen. Gounder calls it “front-end tokenization” and said that “the whole market is moving towards tokenization.”

“The whole market is moving in that direction,” he said, pointing to his company’s front-end tokenization abilities.

And, from a merchant perspective, there’s another security aspect that Gounder believes is worth mentioning, and that is the ability to remove merchants from the payment path.

“That’s compelling to merchants,” he emphasized. “They get secure payments, but they do not get credit card numbers from their customers.”

From the consumer perspective, it’s said to take less than 60 seconds to download the Minkasu app and set up the profile with the quick scan of a card (that works across all banks, networks and merchants that enable the mobile payments solution). The solution is also tuned into the Magento eCommerce network (240,000 eCommerce merchants), along with OpenCard and WooCommerce.

“It’s very difficult to create one new paradigm. We are trying to create a few new paradigms,” Gounder said. “We are creating a solution that doesn’t require a username and password but, at the same time, is more secure than usernames and passwords. It’s your biometrics.”

He emphasized that Minkasu’s solution is secure because it was initially designed to be an authentication solution but was eventually molded and upgraded into a mobile payments solution.

“It’s applicable across all channels. That’s the other paradigm. Most mobile payment solutions in the marketplace are focused on individual channels, individual networks, individual banks, individual merchants or individual operating systems. None of that matters for us. It’s a solution that integrates with all types of channels and all types of merchants,” Gounder said.

Minkasu is currently working on its mobile SDK to make its product solution more streamlined and easily integrated into merchants’ mobile apps. The company hopes to have that SDK completed by the end of next month and is in talks with several large companies to integrate. But more on that later…

As for now, it’s focused on enabling mobile payments.

“We have no friction at all with the banks or credit card networks or payment processors or, for that matter, with the whole credit card ecosystem. We make the current credit card ecosystem more mobile, more seamless and more secure. The credit card ecosystem should love us for it. There’s no friction with the banks, no friction with the credit card ecosystem. The only thing we have to do is to convince the merchants to sign up on one side and convince people on the other side to download our app and make payments,” Gounder noted.

Of course, he admits that second part is no easy task, since Minkasu is vying for a slice of the huge payment market with its unique and ubiquitous solution.

“We think the mobile payments solutions that enable secure payments quickly and easily that are called across devices, channels and merchants, anytime and anywhere, will win the mobile payments war. That will make mobile payments work. We believe that there is no other mobile payment solution in the marketplace which is truly multichannel. We think we are the only one,” Gounder said.

And why?

Minkasu works across all channels — online, mobile Web, social, in-app and in-store. It is operating system-agnostic and device-agnostic. And it is not specific to any network, bank or merchant.

And in the crowded payments space, ease of use and high security are basic requirements for a solution to succeed, whereas in Minkasu’s perspective being ubiquitous to every device and platform is critical to becoming a leader.

Minkasu will be among the innovators participating at this year’s Innovation Project, taking place March 16–17 at Harvard University.

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