Swiff Targets Banks With Its Mobile Payments Solution

In the future, asked to pick a year when mobile payments really started to take off, chances are people will point back to 2012. Square has been ramping up considerably, with the introduction of its Register product, and the “Pay With Square” initiative it unveiled today. This also marks the year PayPal decided to leverage its significant standing in online payments with a mobile-focused product called PayPal Here. But Singapore-based Swiff, another recent mobile payments player, still thinks there’s plenty of room to succeed, and is teaming up with the institutions that already handle people’s finances to stage an end-around maneuver against its flashier, merchant-focused competition.

Swiff, which like Square and PayPal Here employs a mobile card reader dongle to allow merchants to accept card-based payments on the go, bills its system as a POS replacement system, but unlike PayPal and Square, it’s not targeting merchants directly; instead, Swiff is partnering with banks and financial institutions to start where business owners are already having their money managed.

“We are plugging into an ecosystem of existing relationships, and unlike PayPal or Square, we do not have to develop an extensive sales force to recruit new merchants to sign up,” said Etienne Van den Bogaert, COO of 2010-founded SCCP, the company behind Swiff. “This means that Swiff can focus on developing and innovating on technology, and be able to roll out faster across the world.”

Van de Bogaert said he hopes that Swiff ‘s approach will help financial institutions deploy mobile payment solutions that respond to customer needs, something which could especially benefit service industry customers, for instance, as well as users in traditionally underserved communities.

“The mobile phone and phone banking have helped alleviate poverty and created viable economies in rural areas throughout Africa and India, through the creation of a new form of mobile banking and transaction ecosystem,”  Van de Bogaert said. “We hope that Swiff will be able to help complement this by allowing these businesses access to credit and debit card transactions through their existing banks.”

Swiff’s biggest hurdle to adoption might be its rate structure, however, which demonstrates the flip side of dealing with banks: Swiff transaction rates are completely dependent on the arrangement struck between merchants and their institutions, which Van de Bogaert says right now vary between 1.6 percent and 3 percent. That’s well under both Square (2.75%) and PayPal (2.7%) at the low end, but it’s also not necessarily a flat, all-in rate. Still, banks often have the advantage of being well-trusted by their customers, whereas merchants could have little knowledge of Square and PayPal.

While the experience for end-users of each of these three services may be similar, their approaches actually vary considerably. Swiff’s betting on banks and institutions wanting a bigger piece of the pie, which may provide it with some heavyweight backing when it expands beyond Malaysia and Singapore to Europe, the U.S., and other parts of Asia, something the company is planning to accomplish later this year.

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