To hear Dan Wagner tell it, one would think the CEO of London-based mPowa was ready to enter the ring for a prizefight against all comers in the world of mobile card-based payments.
After launching a card-reader attachment for smartphones in Europe last year, mPowa announced June 28 it is ready to go after American merchants. Its product resembles what U.S. merchants and consumers see from Square Inc. or Intuit Inc.'s Go Payment.
mPowa, which supports Apple Inc. iPhones, Google Inc. Android handsets, Research in Motion Blackberry phones and Microsoft Windows devices, targets a market that will quickly "see the difference between our product and the others out there," Wagner says.
mPowa's selling point is its merchant integration and infrastructure, Wagner says. Merchants use mPowa to adapt their current payment system to a mobile environment. Rival systems, which are aimed at micro-merchants require separate accounts and may charge higher fees, he says.
mPowa charges a 0.25% fee for each credit and debit card payment processed and offers a web-based merchant dashboard for account management to monitor payments. Square charges 2.75% per swipe, with manual payments at 3.5%, plus a 15-cent fee.
mPowa also can handle EMV chip cards, whereas most U.S.-based mobile card readers do not.
"We are looking to be able to serve every company on the planet," Wagner says. "The other guys are focusing on those who cannot take credit cards now."
For now, those other guys in Wagner's view include Square, Intuit and iZettle. Wagner expresses no concern about whether his company may be entering the U.S. market too late, considering
Square is also taking steps to boost its appeal to larger merchants. It launched a Register app this year to allow merchants to use it as a simple cash register, and this week it also added a feature that allows employers to provide limited access to their Square account to members of their staff.
Even though mPowa focuses its marketing on what it considers its strengths over Square, Zil Bareisis, a London-based senior analyst for research firm Celent, says the marketplace is far more crowded.
"Companies such as VeriFone, Appriva and Magtek are focused on mobilizing the merchants who already accept cards," Bareisis says. "They all have devices in the market that they would sell through acquirers, ISOs and processors."
Wagner says a major selling point for his product is that it offers a system capable of accepting EMV chip-and-PIN cards.
That can certainly be a differentiator, but "it's not yet critical in the U.S. market," Bareisis says.
Wagner is no stranger to e-commerce in the U.K. and has had several successful ventures in the payments industry, including the Venda Inc. e-commerce provider, says Gareth Lodge, another London-based industry analyst with Celent.
"While he hasn't struck gold every time, he's got a very good track record," Lodge adds. "I'd immediately give this more credibility than most we see."
While mPowa expects to target large companies seeking options to accept payments in a mobile setting, smaller retailers will also benefit, Wagner says.
"The small retailers in a strip mall are tied to their physical location," he says. "With mPowa, they can get out now with a mobile payment option while still using their existing merchant relationships with issuers because it's just a plug-in and go system."
Lodge sees the mPowa's fee structure as another advantage. "Merchants already accepting cards can buy the functionality and not have to pay for an entirely new system to accommodate mobile," he says. "It broadens the market appeal."
Out of its New York office, mPowa intends to negotiate with independent sales organizations and distributors to white-label the product in the U.S. The company is currently negotiating with "a large retailer" in the U.S. to incorporate the mPowa mobile payment system, Wagner says.
