Competition in the nascent market for point-of-sale mobile payments gets a little more crowded today. Adyen, a Holland-based e-commerce specialist, is today launching Shuttle (pun intended). As the backend payments provider for companies like SoundCloud, Getty Images, Benetton, KLM, PopCap Games, Greenpeace, and Vodafone for the last six years and extending that to mobile for the past two, Adyen already processes billions of dollars in online and mobile transactions through its e-commerce platform, according to chief commercial officer Roelant Prins. This is the company’s first big stab at taking its platfrom into the mobile point-of-sale environment.
While many (and I mean many many many many) companies have taken a leaf from the same notebook as Square and developed dongle-based hardware that plugs into mobile devices to turn them into card readers, Shuttle is shooting for something else (yes, another pun – sorry). It also uses hardware, but it’s a standalone, small card reader with a keypad. This links up with a mobile app, which the merchant uses on a separate device.
The advantage, Prins says, is that this means that every transaction on every credit card — Visa, MasterCard, American Express, and so on — is compliant with chip-and-pin security regulations. These have proven to be a hiccup for some startups like iZettle, which was forced to remove Visa acceptance at one point because Visa Europe didn’t accept that its chip-and-signature alternative (it doesn’t have a separate keypad at this point) was secure enough. (iZettle has since created a slightly less efficient workaround, as have its competitors.)
The aim, says Prins, is to do away with not only cash registers, but stationary check-out points. “Think of how Apple employees roam around with their iPads in Apple stores,” he says. Adyen believes that is the template for how all retail situations will look in the future, and so it makes sense to equip those roaming salespeople with a way of taking your money right away rather than sending you to a line elsewhere to pay.
It sounds potentially clunky to have not one but two objects in your hands as a salesperson, but for now there are several European companies that are taking up Adyen on the product and trying it out. They include the online marketplace for “experiences” Gidsy; the ticketing startup ticketscript, and the luxury department-store chain De Bijenkorf.
The last of these, a traditional retailer, is perhaps the most obvious kind of partner for Shuttle. The first two, meanwhile, probably give the best glimpse at how this might be more disruptive.
Gidsy will distribute the card readers to its regular experience purveyors to accept payments at the point-of-experience. Ticketscript has not specified exactly how it would use its service, but it plans to turn it on as a kind of “mobile box office” during the upcoming music/arts festival season next summer; potentially that could mean a way for attendees to upgrade their tickets on the ground or use their cards to pay for goods and services from smaller merchants who take concessions at these events.
Apart from the possibly awkward aspect of carrying a separate device around, there is also the cost that might put off some businesses: Shuttle requires a one-off payment of €99, and then a €10 monthly fee to use it. Transaction fees, however, are considerably lower – 1.4 percent for a credit card payent and 13 cents for a debit card payment — meaning that this structure might be best for companies that think they may process a high volume of transactions.
The fact that Adyen already works with a number of well-known brands — there are more that it doesn’t publicly disclose — gives it a strong leg up in terms of finding willing partners to implement Shuttle.
Prins says it will first be targeting its existing ecommerce client base of 2,500 medium and large companies — “Our user base has been asking us for a solution for point of sale” – before quickly moving to looking for merchants and other, smaller and larger businesses in pastures new.