Bwin, the online gaming giant that is powering Zynga’s first foray into real-money gambling, in the UK, today is spinning off its payments platform Kalixa. In turn, Kalixa is launching new mobile and online wallet products to further its concept of being a one-stop shop for those seeking an e-commerce solution. The move is a sign of how companies are digging in further to tap revenues in the fast-growing world of e-commerce, which passed sales of $1 trillion for the first time last year and is projected to hit $1.3 trillion in 2013.
The move will mean that Bwin can concentrate more resources on building out its gaming operation, while 12-year-old Kalixa can separate itself from being associated with an online gambling company to focus on expanding its own customer base for products to better compete against the likes of PayPal, Amazon and Google. Kalixa says that in 2012 it processed €2.7 billion ($3.5 billion) of transactions for more than 300 merchants, and its prepaid credit cards, which it provides with MasterCard, are being used by some 150,000 people in Europe.
E-commerce is a world filled with fragmentation — not only do you have companies specialising in different parts of the process, from point of sale solutions and merchant acquiring to clearing payments and security, and everything in between — but there are dozens of companies out there looking to dominate in one or more of those areas. Kalixa’s core concept is that it is a platform and framework that simplifies all of that by being a one-stop-shop, which it says reduces the hassle and cost of running an e-commerce operation.
“Most merchants and consumers don’t know that up to ten different companies are involved in making or accepting a single payment, with each one taking a cut and expecting a return. This is adding unnecessary cost, complexity and risk to merchant and consumer payments. In times of austerity, businesses with shrinking margins and consumers with lighter wallets simply cannot go on paying over the odds,” Ed Chandler, CEO of Kalixa Group, noted in a statement. “Kalixa is here to disrupt this scenario. We intend to trim the ‘fat’ by removing the excess links in the value chain to make payments simple, seamless and secure.”
In Kalixa’s case, that means working with 200 of the world’s most popular payment methods, and launching some new services to complement the payments platform that it has already been operating. The new products coming online today include a mobile payments solution and Kalixa’s answer to Visa, PayPal and Google to provide a “wallet” to users so that they can pay for goods online simply by signing in rather than entering payment information again and again. The details:
Kalixa Pro: Aimed a small businesses, this is Kalixa’s mobile payment solution. Like iZettle and PayPal’s upcoming Here service in the Europe, it is aimed at small businesses will use chip-and-pin to authenticate users, and it’s linked to the company’s Kalixa Pay e-wallet initiative. “By providing a wallet, as well as an mPOS, merchants can pay suppliers, transfer funds and better manage their money without the costs and complications of a traditional small business account,” Kalixa notes.
Kalixa Pay, meanwhile, is an extension of the company’s existing relationship with MasterCard for prepaid cards. Users can load up money into the cards, and then use them to pay for goods using either mobile devices, or the cards themselves. Kalixa offers users a no-extra-fee service when these are used outside their home countries.
Kalixa Accept is a merchant-focused solution that lets businesses power all their e-commerce operations using Kalixa’s platform.
Asked whether the Bwin association had been a hindrance or a help to Kalixa prior to spinning out as an independent company, Kamran Hedjri, Kalixa’s chief commercial officer, told TechCrunch that it was actually a good thing for the company: not only is Bwin an obvious and strong customer, but being connected to a regulated, online gambling company “helped us develop and a lot of benefits and particular skills in areas like fraud management. Now we show those in other sectors like travel how best to approach this.” Spinning off from Bwin, he says, is “an opporunity to develop this even further.”
He notes that Bwin has ploughed some €100 million ($130 million) into developing Kalixa’s technology to date.