Noca, an online payments start-up we wrote about last year, is launching its official payment service today. Formed by ex-Visa employees, Noca originally offered a micro-payments system via two Facebook applications, OneClickPay and HelpYourWorld. The company is now offering payment services for unlimited amounts. Currently, Noca has two clients; digital content provider Klatcher.com and local little league site. The advantage of Noca’s system is that it allows online merchants to bypass high transactional fees (usually 2-3 percent plus $0.30) imposed by credit card companies on consumer purchases. → Read More

If you sell anything online, whether physical goods or services, you’re probably keenly aware of the 2-3% (plus $0.30) lost through transactional fees every time someone makes a purchase with their credit card. This fee rears its ugly head whether you use PayPal, Google Checkout, or Amazon Flexible Payment Service since those companies are largely just passing on the fees imposed on them by credit card companies. Noca, a startup founded by ex-Visa employees, is attempting to virtually eliminate transaction fees by bypassing the credit card companies altogether with its own online payment service. Since $5 billion goes towards online transaction fees every year in the United States alone, and since online vendors have particularly slim profit margins, the company thinks that the near elimination of transaction fees would be a huge boon for online vendors. Concurrently, Noca seeks to provide consumers with a more rewarding and more secure purchasing experience, thereby making its service appealing to both actors involved in a transaction. While Noca aims to eventually facilitate online payments for purchases of all sizes, it begins with a focus on micro-payments, and on micro-payments made through Facebook in particular. It has launched two Facebook applications to test its payments system out: OneClick Pay and HelpYourWorld. The former provides a simple way to send money to friends. As you can see in the screenshot to the left, the idea is to send someone a digital check; you actually enter your routing and account numbers into the application instead of using a credit card. This poses a significant obstacle to adoption (who remembers these numbers or carries around a check in their pocket?). But the company insists that using checking information rather than credit card information increases security and reduces the chances of identity theft. Plus, Noca is working to provide functionality that would allow you to enter your online banking credentials in lieu of your checking information. The latter Facebook application, HelpYourWorld, provides a good use case for Noca’s micro-payment system. Since the application solicits $1-at-a-time donations for a series of causes, it benefits greatly from Noca’s lack of transaction fees (especially the standard fixed one of $0.30). Noca hopes that many other Facebook applications with similar micro-payment needs will use its APIs to implement its payment service. As for the benefits to the consumer, Noca promises to provide strong and flexible incentives through cash back schemes, frequent flier → Read More