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Table of Contents

Lead Story

Legislative outlook:
Some clouds but no rain

Patti Murphy
The Takoma Group


Industry Update

New fees, more money for Visa, MasterCard

RBS, Heartland PCI compliance revoked: What's next?

A token of payments to come

Raising the ACH bar

Virtucard for virtual goods


Bill Pirtle

Breaches across America
installment two

Selling Prepaid

Prepaid in brief

Boom time for prepaid game card market

Global payroll done with SaaS

The state of escheatment


Be the toast of hosts

Scott Henry

Sluggish economy spurs faster payments

Nasreen Quibria
Association for Financial Professionals

Mobile payments? Not yet

Biff Matthews
CardWare International


Street SmartsSM:
Who are you?

Jon Perry and Vanessa Lang

Pull back the expense curtain

Jeff Fortney
Clearent LLC

Downshifting to rev up sales

Christian Murray
Global eTelecom Inc.

PCI versus tricky technology

Michael Wright
Panoptic Security Inc.

Five magical questions in making sales

Daniel Wadleigh
Marketing Consultant

Company Profile

UseMyBank Services Inc.

Data Delivery Services Inc.

New Products

Instant mobile processing

MerchantWare Mobile
Company: Merchant Warehouse

A most literate check reader

Company: Parascript LLC


See it, believe it



Resource Guide


A Bigger Thing

The Green Sheet Online Edition

April 13, 2009  •  Issue 09:04:01

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Virtucard for virtual goods

The Virtucard, a new online payment method from SafPay Inc., promises no chargebacks and a low per-transaction fee for merchants while offering anonymity and security to consumers. Consumers load virtual mall cards with their banks' online bill-pay providers and use them like gift cards at participating online stores.

The micro niche

According to George Ouzts, SafPay's Chief Executive Officer, merchants are charged a flat 3 percent per transaction for all Virtucard transactions.

The lack of additional merchant account fees or interchange makes it economical for merchants to accept micropayments, which are used in the online gaming industry, on social networking sites and for pay-per-use services. Ouzts said there is growing interest in secure, membership-based Web sites that charge by the minute and that some merchants whose customers formerly paid with credit cards were adopting the Virtucard instead.

He also indicated online travel services and goods-not-present merchants (ones that sell goods that are not physically shipped, such as software, music and virtual items) are examples of high-risk vendors who might be good Virtucard candidates.

Virtual mall in reality

"On the merchant side, we didn't realize how many merchants were unhappy with either their current credit card processor or how many merchants couldn't get credit card merchant accounts in the U.S. and were forced to go offshore," Ouzts said.

He added that consumer enthusiasm for Virtucard was also surprisingly high. "[Consumers] were loading up their cards with hundreds of dollars; they were spending more than typical credit card users," he said.

He speculated that consumers were using this payment method either because they felt safer or because they felt compelled to spend funds already loaded onto the card - even though SafPay allows consumers to cash out their cards at any time.

Paul Grill, an Annapolis Consulting Partner who focuses on card issuing and emerging payments, said that among the many new payment offerings designed to lower transaction costs for merchants, the security and anonymity of Virtucard is a unique twist.

"The challenge, I think, with a lot of these product offerings is how to really drive the consumer uptake because they tend not to have the same level of perceived benefits to the consumer as might a traditional card-based product," Grill said.

ISO angle

Grill said that ISOs focusing on e-commerce should be "thinking about ways to act as a distribution entity or consolidator or some other business model that allows one to help these companies actually flourish and still participate in some of the transaction flow opportunity."

Though companies offering alternative payment options won't be quick to give up their margins, using the proven and effective ISO channel is a reasonable strategy for them to pursue, Grill said.

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.

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Spotlight Innovators:

North American Bancard | Simpay | USAePay | Impact Paysystems | Board Studios