A consortium of financial and technology companies plan to market their payments capabilities to small businesses by promoting their compatibility with the latest version of Microsoft Corp.'s Windows operating system.
The San Francisco payments technology vendor BServ Inc. announced this week that it is offering its DepositNow system for remote image capture through Windows Vista Business, the software giant's version of its Vista operating system designed for businesses.
David F. Kvederis, BServ's president and chief executive, said Microsoft was looking for what it calls "Wow" applications that would give Windows users a reason to upgrade to Vista. "For businesses, and small businesses in particular, one of the things they are promoting is the Commerce Center."
The Pass Consortium operates the Pass Commerce Center, which was designed by IP Commerce Inc. of Denver, to serve as the link between BServ and other payments technology vendors to reach Microsoft's desktop. Pass, which stands for "Payments as a Secure Service," uses Internet protocol and a service-oriented architecture to offer what the IP Commerce is calling an IP Payments Framework.
Alfred "Chip" Kahn 4th, IP Commerce's founder and chief executive, said Microsoft and the other participants in the consortium plans to begin a major marketing campaign next week with magazine and online ads that target small businesses. The campaign will run through July.
Chase Paymentech Solutions LLC, a joint venture between First Data Corp. and JPMorgan Chase & Co., is providing card-acquiring services for the consortium. PayPal Inc., the payment processing unit of eBay Inc., is providing online invoicing and payment, CIT Group Inc. is providing business financing, and Internet Commerce Corp. is providing electronic data interchange with large companies.
Mr. Kahn said the group hopes to expand its payments capabilities eventually by working with other companies, though it does not plan to open its doors to all comers.
"Pass is a consortium of complementary providers," he said. "It isn't in the best interest of our partners" to invite their competitors in to compete on price.
However, the IP Payments Framework is available to other users that may want to offer their services online in a services-oriented architecture format. JPMorgan Chase, for example, "is using IPPF in other areas outside Pass," he said, though he said he could not further discuss the New York banking company's plans.
Kevin Gallagher, the senior vice president of corporate alliances at Chase Paymentech, said it plans to use the framework to integrate its card processing services with various accounting software packages, but the integration with the Windows operating system also presents "a large opportunity to touch a lot of new merchants that are using PCs."
Chase Paymentech will target new businesses, Mr. Gallagher said. "The PC is one of the first solutions they buy."
But the Microsoft integration also represents a chance to get customers of other acquirers to switch, in order to gain the efficiency of the integrated Pass system, he said.
Mr. Gallagher would not discuss the specific potential impact on his business, but he said Microsoft expects 1 million to 2 million small businesses to buy the Vista system this year.
The Pass Commerce Center appears on a computer's desktop as an onscreen icon, or "gadget," that can be downloaded from the consortium's Web site and lets users access the various services.
"We're taking these disparate capabilities and merging them in a single place," Mr. Kahn said.
The system is designed to integrate with Windows Office applications that customers may already be using, such as Word and Excel. Mr. Kahn said that a business owner could generate an invoice with Excel and send it over e-mail, enabling the recipient to click a button to pay it through PayPal.
Mr. Kvederis of BServ said the Commerce Center also integrates with the DepositNow service, so that someone using Intuit Inc.'s QuickBooks accounting package can set up the system to reconcile a check image with the appropriate customer invoice automatically within the accounting software.
BServ began marketing DepositNow actively about six weeks ago, targeting accountants and consultants who work with small-business owners, he said.
"They're now installing it with their customer base," Mr. Kvederis said. "It's starting with the more sophisticated QuickBooks users. We think it will eventually start moving down market."
BServ has been working with IP Commerce since August to develop the services for the Commerce Center. It is developing interfaces for Microsoft's Small Business Accounting software and Sage Software SB Inc.'s Peachtree Accounting software, he said.
"We've talked about whether we could or should extend this to our other products," Mr. Kvederis said.
BServ also offers outsourced federal wire transfer processing to financial institutions, telephone and online electronic check services, and international funds transfers.
"All those would be feasible at some point," he said, but the company has no plans yet to expand beyond check imaging. "One step at a time. Everybody's trying to get Vista launched and get Commerce Center publicized now."
Maggie Scarborough, a senior analyst at Financial Insights Inc., a research unit of the Boston technology publisher International Data Group Inc., said that even though the effects of this initiative remain to be seen, it is an important indicator of the direction technology is likely to take in the future.
"The integration is pretty important, because it removes an obstacle for the small business. It's very important to get on that desktop," Ms. Scarborough said. "The banks are going to have to think very carefully about this. They're going to have to have their spot on the desktop."
