BetaKit covered the launch of Los Angeles-based startup Wallaby Financial‘s “one card to rule them all” linked credit card solution in June, outlining how its Wallaby card will let consumers combine their existing credit cards into one, routing purchases to the card with the best rewards for any given purchase. Today the company announced the launch of its iPhone app, which helps consumers optimize their credit card rewards, and can be used on its own or in conjunction with the Wallaby Card when it launches to the public in early 2013.
Founder Matthew Goldman, a former consultant and Greendot product manager, said that they’re still finalizing Wallaby Card details, and the iPhone app is a way for people to get a feel for what the card will offer before it launches. He also sees it as another option for people who want to maximize their credit card rewards, but don’t necessarily want to use the Wallaby Card to make all their purchases.
“The banking system is always slower than technology companies would like it to be, but we continue to make progress. Seeing that the card is taking a bit longer than we had hoped…we decided that we could essentially repurpose our same algorithm and decision-making technology and present it to users in an application that would allow them to get the recommendations, get the intelligence,” Goldman said.
When the Wallaby Card launches, it will help people keep a single card in their wallet, which they can use for every purchase, both online and offline, without worrying about which would offer the best rewards. In the background Wallaby routes transactions to the card with the best rewards for any given purchase, supporting AMEX, Visa, MasterCard, and Discover cards to date. Users can set preferences, for example whether they prefer to earn cash back or travel miles.
Today’s iOS app offers the same functionality, but without the physical card, and without access to transaction data. After downloading the app, users can find their credit cards from the database of available rewards cards. Then when they’re shopping, users can open the app, choose the store they’re in, and the app will tell them which credit card to use in order to get the most points or rewards, both based on the card’s regular rewards program and any available promotions. “It essentially answers the question ‘which card should I take out of my wallet to pay with,'” Goldman said.
The key value of the upcoming Wallaby Card is that it won’t require an additional step for users, since they can just pull out their card and pay as usual and the app routes payments on the back-end. The iPhone app requires users to open it every time they make a purchase, something users likely won’t want to do at the point of sale. When the Wallaby Card launches, the app will act as a companion to the physical card, tracking transaction data and sending push notifications to users outlining the rewards they’ve earned.
The company, a graduate of startup accelerator MuckerLab, raised a $1.1 million round in August 2012 from Peter Thiel’s Founders Fund Angel and several other angel and institutional investors. As of that time, the company had 10,000 people on its waiting list, and Goldman said that number has increased by several thousand since then.
The iPhone app is free, and the Wallaby Card will be free during beta testing, but they will be charging for it after the public launch. As Goldman told BetaKit in a previous interview, the company will also be charging banks and merchants to offer deals and incentives to users. The app only works with U.S. credit cards, though Goldman said they’re working on adding international support. They’re also looking to launch an Android app before the end of 2012.
The mobile payments space has become increasingly populated, and increasingly fragmented, in 2012 with everyone from wireless carriers to retailers to startups trying to give merchants an easy way to process payments, and consumers an easy way to pay with their smartphone. While Wallaby isn’t trying to be a digital wallet, the new iPhone app shows that it might move to being a suite of products as opposed to just being a linked credit card. With hints that Google might be launching a physical card to accompany its Google Wallet solution, it appears that there’s still room for physical cards in the mobile payments space, even if it’s just to get consumers acquainted with the idea of using a digital wallet.