The Green Sheet Online Edition
December 22, 2008 • Issue 08:12:02
Payments in your pocket
A new catchphrase used to describe many independent contractors is mobile merchants. But they're the same guys and gals seen everywhere in the United States: landscapers, taxi drivers, pool cleaners, plumbers, carpet cleaners and door-to-door salespeople of every variety and stripe.
The card companies would characterize this vast army of on-the-go merchants as level 4 merchants, defined as individuals and businesses handling less than 1 million electronic transactions annually.
Approximately 6.5 million U.S. merchants are considered level 4.
But Gary Goodrich, Chief Executive Officer at ProPay Inc., said the card brands have overlooked about 25 million others who are part-time mobile merchants - termed micro merchants.
Simple, not ordinary
ProPay is targeting that market with the launch of the MicroSecure Card Reader, a card swiper about the size and weight of a pack of chewing gum.
According to ProPay, its simple design mirrors its simple use. It has one button (for on or off), no keypad and no screen.
When cards are swiped, the indicator light shows green if the swiper achieved a good read off of the mag stripe; a red light indicates the card needs to be swiped again.
The reader can either store transactions for later processing (up to 70 transactions can be stored on the reader at one time), or transactions can be processed in real-time.
The MicroSecure connects to laptops via Universal Serial Bus (USB) ports. Merchants log into their ProPay accounts online, at which time transactions are processed over ProPay's secure platform.
Once transactions are processed, cardholder information is deleted from the device.
It cannot print out paper receipts, but e-mail receipts can be sent. ProPay supplies order forms for writing down basic customer information. The swiper is battery-powered and can last for eight hours of continuous usage. It has an automatic shut off function when the device is idle, which gives it a practical use of several weeks, Goodrich said.
The device is automatically recharged when it's plugged into a USB port.
According to Goodrich, data security on the reader is robust for such a tiny and inexpensive device. Using encryption technology called derived unique key per transaction, transactions are triple DES encrypted when cards are swiped.
Each time a card is swiped, a new encryption key is generated. The encrypted data is only decrypted at ProPay's data repository secured with ProtectPay, ProPay's Payment Card Industry Data Security Standard compliant architecture.
Goodrich stressed that at no point in the life of transactions using MicroSecure and ProtectPay is the data "in the clear." But that doesn't mean merchants don't have access to transaction data.
Functioning as a virtual terminal, ProtectPay has reporting features that allow merchants to retrieve and reconcile chargebacks.
Protection is key
Goodrich believes MicroSecure is ideal for independent businesses that employ sales forces to sell everything from pest control services to Bibles door-to-door.
Using inexperienced college students as sales reps, for example, may worry bosses when card fraud is so prevalent.
The simplicity and security of MicroSecure helps "protect that franchise owner from his own independent sales force," Goodrich said.
Headquartered in Orem, Utah, ProPay has been providing payment processing for small and home-based merchants since 1997. MicroSecure has been available since October 2008.
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