Feeds

PayPal founder sets up mobile payment service verified by FACEBOOK

2-click buy-now-pay-later system

Secure remote control for conventional and virtual desktops

PayPal co-founder Max Levchin has launched his new payments startup, Affirm, to fight it out in the rapidly expanding arena of mobile payments.

The new firm will use customers' Facebook accounts to authenticate their identity, allowing them to buy stuff on their mobes with just two taps.

"Affirm brings two-tap checkout to any mobile retail experience and liberates abandoned carts from an eternity in mobile shopping cart limbo," the company website says.

Affirm gets away with using such basic info and security by paying for the goods for the shopper and then giving them 30 days, interest-free (at least for now), to fully enter their details at the firm's website to pay them back. It will make its money by charging sellers "a small fee".

Etailers are likely to want to sign up with Affirm to stop mobile shoppers giving up on purchases when the required information entry is too complex or takes too long for smaller phones or when they're not in a position to whip out their credit cards.

Levchin's startup is by no means the first to try to simplify shopping on the go by getting folks to buy now and pay later. In the UK, PayForIt allows merchants to sign up with a processing party which collects money from network operators who then go on to grab the cash from their customers, with both the processor and operator taking a cut.

Swedish firm Klarna also offers a similar service to Affirm in a number of European countries, with options to pay for each item after receiving them or pay monthly for all goods and spread payments out. The company says it processed €1.8bn in transactions in 2012.

Although there are plenty of established competitors in the payment field, Levchin clearly thinks that a "low-digit millions" funded startup has a chance.

“I just think there is so much more to do. Technology has come a long way since PayPal," he told AllThingsD.

“Payments online are still too hard — we started the revolution with PayPal and democratised payments for small businesses, but we stopped short of changing the system,” he said. “The world is now awash in data and we can see consumers in a lot clearer ways."

That data is both the blessing and the curse for online and mobile payment firms. Levchin is hoping to authenticate users with Facebook, zip (post) codes and mobile device IDs and will also using that information to assess whether someone is likely to pay up when the time comes.

But the system is going to need pretty sophisticated fraud-detection software to stop any coordinated efforts at corruption and will become unpopular pretty quickly if it's essentially rejecting people for credit left, right and centre. There will also be the inevitable cries over privacy violation, whether warranted or not. ®

5 things you didn’t know about cloud backup

More from The Register

next story
UK fuzz want PINCODES on ALL mobile phones
Met Police calls for mandatory passwords on all new mobes
Canadian ISP Shaw falls over with 'routing' sickness
How sure are you of cloud computing now?
Don't call it throttling: Ericsson 'priority' tech gives users their own slice of spectrum
Actually it's a nifty trick - at least you'll pay for what you get
Three floats Jolla in Hong Kong: Says Sailfish is '3rd option'
Network throws hat into ring with Linux-powered handsets
Fifteen zero days found in hacker router comp romp
Four routers rooted in SOHOpelessly Broken challenge
New Sprint CEO says he will lower axe on staff – but prices come first
'Very disruptive' new rates to be revealed next week
PwC says US biz lagging in Internet of Things
Grass is greener in Asia, say the sensors
Ofcom sees RISE OF THE MACHINE-to-machine cell comms
Study spots 9% growth in IoT m2m mobile data connections
O2 vs Vodafone: Mobe firms grab for GCHQ, gov.uk security badge
No, the spooks love US best, say rival firms
Ancient pager tech SMS: It works, it's fab, but wow, get a load of that incoming SPAM
Networks' main issue: they don't know how it works, says expert
prev story

Whitepapers

Endpoint data privacy in the cloud is easier than you think
Innovations in encryption and storage resolve issues of data privacy and key requirements for companies to look for in a solution.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Solving today's distributed Big Data backup challenges
Enable IT efficiency and allow a firm to access and reuse corporate information for competitive advantage, ultimately changing business outcomes.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.