INTERVIEW: CloudZync’s CTO on creating an e-wallet that looks beyond payments

Competing with big players

¤ Is there space for another mobile payments service?

There are two parties that have to be enthused for this to work. First, you need merchants. If there’s no real added value to them, merchants aren’t going to be interested in taking mobile payments. Payments itself is an unbroken mechanism, so there’s no incentive for them to spend any time or investment using that technology. It has to add value. That’s why you have to look beyond the payments to get mobile payments adopted.

Likewise, for a consumer, if you just offer payments around mobile phones, it doesn’t stop people carrying around wallets. They still need debit cards, membership cards, loyalty cards and vouchers. If I still carry around that wallet there’s no real incentive for me to make an active decision and use my mobile phone.

¤ How do you plan to compete with the big players in the space?

By aligning to the needs and wants of a small business through customer relationship and engagement. We offer a whole tool for businesses to continue to grow. The proposition is very different to anybody else’s out there and that’s really what we find is giving us an edge, especially with independent businesses.

The technology we deliver is really helping the high streets fight back against the large corporations. Small businesses – boutiques, cafes, independent beauty service stores – have the ability now to say,  spend GBP40 (USD62) a month and get the capability to compete with Tesco in terms of loyalty deals and vouchers and provide a far superior customer experience. And that’s really what’s going to help them grow their business and help drive people back into the high street.

¤ How did you approach developing an e-wallet?

It’s not a game changer for a business to take payments on a mobile phone. Payments in themselves aren’t broken. After about 18 months’ worth of research into the mobile payments industry it became pretty clear that businesses, especially small businesses, were not just looking to mobile as another form of payment, but for a way to leverage that technology further.

A smartphone is a very personal device to you as a consumer, so we wanted to find out how businesses could leverage that personal feeling you get with your mobile phone. How can they use mobile services to retain their customers and really provide great customer experiences? They’ve got a lot of tech in there. How do you utilise it to really grow your business? And that really was what came to the fore, rather than just a pure payments mechanism.

¤How does Zync Wallet work?

As a consumer you download the Zync Wallet mobile app free of charge onto your phone. It’s a prepaid environment so you top up your phone or you put money into your Zync account and then you’re ready to use it with any participating store.

It provides a very personal payments channel between you and the stores that you shop in. It’s a one-to-one payments channel, not an open channel. You use a PIN number to get into the application, there’s a big pay icon that displays a QR code, which is unique for every single transaction that you make and then the businesses simply scan a QR code off the app.

Any personalised deals and loyalty points that you would benefit from automatically go straight into that transaction, whether you found them or not. So in a single transaction, you could be paying a couple of bills, use a group voucher and have your loyalty points topped up, all by having that single QR code scanned by the business.

¤ How is the product going to generate revenue?

For consumers, everything is completely free of charge. For businesses, you have two options. The first one is a pay-as-you-go option that’s purely based on the transactions that you complete. So a small or an independent business can a take a mobile payment and pay a maximum five pence to Cloud Zync for that transaction to be processed. As it processes more transactions that fee will drop. So there’s no sign-up fee or monthly charge at all.

The second method is to subscribe to the business services that Cloud Zync provides in Zync Wallet. They include a white-label loyalty scheme and the ability to send out branded notifications and set-up vouchers. They can set-up personalised deals, which identify you as a consumer, are targeted at just you and valid for just you. Businesses can pay USD62 a month to start for that particular service and then pay nothing towards any of the transactions or process. 

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