Realex Payments, the leading Irish web payments processor, have been very busy the past few weeks. They were the headline sponsor for the IIA 2009 Congress on May 21st where they launched a new website onlinepayments.ie. The site promotes the concept of building an online payment strategy for your business. On June 9th Realex announced that they signed a five year deal with Virgin Atlantic to provide a payment solution for Virgin Atlantic customers worldwide. Later in the same week Realex relaunched their corporate website www.realexpayments.com, including lots of new useful information for businesses starting to take payments online.

Highlights include:

• 5 steps to selling online - details 5 steps to accepting online payments on your website with Realex.
• Merchant services agreement -  provides contact details for acquiring banks and card schemes that Realex work with.
• Fraud Management - gives details of the fraud management tools provided by Realex.
• Checklist for working with Realex Payments - a list of 9 items that must be in place before you can accept online payments with Realex.

Earlier this year we reported that SagePay, a Realex competitor, were entering the Irish Market. SagePay introduced the SagePay Go package. The service costs €25 per month for up to 1000 transactions per quarter with additional transactions charged at 15c each. The package includes CVN, fraud prevention tools and 3D secure. This was the first service of its kind in Ireland to have transparent pricing, no set-up fees and 24/7 support.

Realex Payments, in swift response have introduced a new package called RealPay. The new package costs €29 per month, includes 350 transactions per month (equating to 1050 per quarter) with additional transactions charged at 19c each. The new package does not have any setup fee and includes CVN, fraud scoring and 3D secure at no extra cost. Full details of the RealPay package are available on the revamped Realex Payments website.

This is great news for small businesses and start-up companies wanting to accept online payments in Ireland. The new pricing plans offered by both providers have significantly reduced the barrier to entry for accepting online payments in Ireland. Payment processing services for Irish SME's are now easier to see at a glance and this will act as an enabled for the web-based sales channel. This is very encouraging for anyone wanting to start an online business in Ireland. Comparing the annual cost of either the SagePay or RealPay package, both will come in at less than €350 which is similar to the annual cost of a broadband service or IIA SME Membership.

The last remaining hurdle in accepting payments online as an Irish business is getting an Internet Merchant Account and managing the associated costs, which we will explore in an upcoming blog post, so be sure to subscribe to the RSS feed of our blog.

Dave

Related posts:

• Realex Payments Launch Online Payments Website at IIA Congress
• UK Payments Service Provider to enter Irish Market

Last month there were some reports that Facebook were about to start testing a payments system with developers over the coming weeks. At the time details were a bit scarce but the general idea appeared to be that they were creating some kind of virtual currency called "Facebook Credits" based on the US Dollar.

On June 1st finextra reported that Facebook has begun testing a virtual currency payments system with the GroupCard application. The GroupCard application is powered by www.GroupCard.com. It allows you to create greeting cards that you can sign and invite your friends to sign also. Right now the application has 144,026 active users.

 

 

In the GroupCard application users now have the option to "Pay with Facebook" along with the other payment options such as Visa and Mastercard. The virtual currency can be purchased from the Facebook Gift Shop with one facebook credit costing 10 cents (USD). Similar to the Pay-as-you-Go mobile phone business model, customers will purchase credit to be used in small amounts as they wish. TechCrunch recently have reported on the story providing screenshots of a purchase on the GroupCard application using the facebook currency.

The Facebook Gift Store was already charging 10 points for certain gifts. If you select a "Gift" and you do not have any credits you are prompted to purchase some credits as follows:

 

 

 

The Gift Store was launched in Feb 2007 and appears to be doing quite well. So Facebook are now extending their credits platform to be used as virtual currency in applications outside of the Facebook Gift Store. If this virtual currency becomes popular with Facebook users then we could see it expanded outside of Facebook to be used for micro-payments throughout the Internet. This is where things would get interesting. In the past, several companies have attempted to provide micro-payments but trust is a big issue in this area and typically this is the reason they have failed.  In the case of Facebook it is a well known brand with a strong following - circa 200 million members and currently 54 thousand applications so they are well poised to overcome these obstacles.

 

I think Facebook providing micro-payments is good news for Facebook, Facebook members and Facebook application developers. The virtual currency will help cut down on transaction processing fees i.e. members will buy credit in bulk which will result in one transaction. The members will then make many virtual currency transactions using this currency allowing Facebook application developers to generate revenue from their applications. I am sure Facebook will take a small slice of each payment also so everyone wins.

 

Facebook are not the only organisation looking at micro-payments. The Wall Street Journal, one of the few remaining news websites that still charge for accessing their content, announced last month that they are looking to introduce a micro-payments scheme this autumn. Apple announced that their iPhone 3.0 software will provide the ability to do in-game micro transactions.  The App Store allows users to purchase applications and games for their iPhone or iPod touch but the users must pay upfront for the application. The introduction of in-app micro-payments will change the dynamics of this and also provide an incentive for application developers to continue enhancing and adding new content after an application has been released.  Developers will receive 70% of the purchase price of any in-app items they sell and they will be paid on a monthly basis with no credit card fee's applied. This follows the "batch and bill" process that Apple implemented with iTunes which helps to cut down on transaction costs by billing customers once for their purchases during the previous week. However not everyone is happy about the introduction of in-app transactions as they think it will result in lots of apps turning into trial apps where you have to make further payments to unlock functionality that should have been included in the basic application.

I think micro-payments are a great idea and I will continue to follow the Facebook and Apple stories to see how they progress over the next few months. I am surprised that PayPal have not entered more aggressively into the area of micro-payments. Currently they provide micro-payments pricing which they say is designed for merchants who process low-volume transactions typically under $10 in value.

Dave

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UPDATE(S)

05-06-09

InsideFacebook.com interviewed Facebook CEO Mark Zuckerberg about the future of the company. They asked if the majority of transactions would take place within Facebook.com, or on other website. Mark did not dismiss the idea of transactions taking place externally but said having the transactions within Facebook.com was a good starting point.