The startup run by former Google and PayPal executive Osama Bedier has signed Chase Paymentech and Vantiv to distribute the Poynt terminal.
The two payment processors will roll out the new payments terminal to small retailers, restaurants and other businesses.
The two companies, who have set up card-swiping terminals and process card payments at more than 800,000 U.S. merchant locations with about $1 trillion of annual payments, are joining as founding partners of Poynt’s payments platform.
Chase Paymentech and Vantiv will add Poynt to a line-up that includes payment terminals from incumbent leaders in the sector VeriFone and Ingenico.
Bank networks are crucial partners for payments startups because they provide the bank accounts that allow merchants to accept card payments.
While such partnerships do not always guarantee success. Square’s tie-up with Chase Paymentech as it tried to get its service into Starbucks springs to mind, where a rise in transactions still led to losses. But Poynt is prepared.
“I feel we’ve protected ourselves from that,” Bedier said. “We are aligned on making this accessible to merchants.”
Poynt plans to generate most of its revenue by taking a cut of software sold to work with the terminal. It expects most of that software to come from outside developers, similar to the apps available in Apple’s App Store. If a merchant pays $50 a month for point-of-sale software accessed through the Poynt terminal, the company will take about $10 of that, Bedier said.
Poynt plans to distribute the hardware mostly through merchant-acquiring banks, starting with Chase and Vantiv. Poynt will share some of its revenue with these banks, Bedier said.
The banks will charge merchants the same processing fees, but they may contribute their own merchant software to Poynt’s platform. Vantiv has analytics software that it offers to merchants, based on the payment data it handles. The company may turn that into an app that merchants can use through the Poynt terminal. Any revenue from this would be shared with Poynt, Daniela Mielke, Vantiv’s chief strategy and product officer, told The Wall Street Journal.
Bedier hopes that the change to EMV cards in the US will provide an opening to sell its terminals to merchants.
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