Ukash, a United Kingdom-based firm that sells prepaid vouchers for online shopping, announced today it has introduced its products at more than 600 locations in Norway. Ukash launched of online issuing of vouchers in Norway in December.
The vouchers have unique 19-digit codes consumers enter when initiating purchases on merchant Web sites. Ukash and other firms offering similar vouchers sell them to consumers who prefer not to use cards for online purchases or who cannot use cards.
Ukash offers “incentives” to merchants that accept the vouchers, but declined to reveal details. It earns revenue through “redemption fees” from merchants, normally a percentage of the transaction, not a flat rate. The rate is “typically higher than credit card transaction,” reflecting the fact that vouchers incur no charge-backs and
reduce cash-handling expenses for the merchant, Ukash told PaymentSource last year.
In Norway, Ukash is partnering with Convenient Card AB, a payment-services provider of prepaid phone cards that operates in Norway and Sweden. The vouchers are available at convenience stores, including those operated by 7-Eleven Inc. The vouchers are free to purchase and come in denominations of NOK 100 (US$16.84), 250 and 500.
In December 2007, Ukash expanded it voucher system to Sweden from the other 21 countries it services. The vouchers are now available at more than 320,000 physical locations and online. Vouchers purchased online in one country can be used at a merchant’s Web site from another country.
The company has targeted Scandinavian countries as its key growth markets and expects to continue to expand its geographic reach in the region during the coming months. Denmark and Finland are the two remaining Scandinavian countries Ukash has yet to tap.
