Giftango Corp. wants to give merchants a head start on the mobile-wallet age by placing two-dimensional barcodes on the back of their proprietary, closed-loop gift cards to enable consumers to convert the plastic to a digital format via a smartphone camera, among other capabilities.
The Portland, Ore.-based company on July 20 introduced the Mobile Wallet Conversion Platform, software that features an application programming interface for physical card printers to create encrypted 2D barcodes, a free merchant-branded mobile gift card portal, and a programming interface for merchants and mobile-wallet creators.
The plastic-to-digital method will help mobile-wallet providers more easily communicate with plastic gift cards, Giftango CEO David Nelsen tells PaymentsSource.
The mobile wallet could store card balance and transaction histories. Providers also could work with merchants to offer promotions once a specific digitized card is placed inside the mobile wallet, Nelsen says.
“We’re confident those mobile-wallet providers will bring propositions to the merchants that they’ll want to take advantage of,” he says.
Cardholders also would have the ability to check a card’s balance and transaction history by scanning the barcode and entering a four-digit PIN in the merchant’s mobile phone application.
Smart Transaction Systems Inc. introduced similar capabilities using a Quick Response code on the back of gift cards (
Giftango is not charging merchants to put the barcodes on the cards or for the initial card-balance and transaction-history service. The company eventually will charge merchants for the plastic-to-digital conversion, regifting the funds on the card and for a promotional interface, Nelsen says. Giftango did not disclose the pricing.
Ben Jackson, a senior analyst in the prepaid advisory services unit of Maynard, Mass.-based Mercator Advisory Group, believes merchants will find Giftango’s offering valuable as long as the pricing does not take away from the profit made off the card. A gift card’s primary worth to a merchant is consumers spending more than the card’s value, he notes.
“If [the pricing starts] to eat into the uplift, merchants make take a dim view” of the offering, Jackson adds.
But overall, Giftango is providing a chance for merchants to keep the cardholder engaged and bring them to the store to use the cards, Jackson believes.
“The value of adding the digital aspect is that it makes the plastic card a little bit ‘smarter,’” he adds.
Giftango initially is working with Travel Tags, a subsidiary of Inver Grove Height, Minn.-based IGH Solutions Co. Travel Tags is a plastic card printer and will offer Giftango’s platform to merchants. Nelsen says he is speaking with at least two companies that plan to introduce the enhanced gift cards to its customers.
“Those merchants that participate in something like this will have an early-adopter advantage into some of the functionality” that mobile-wallet companies might provide, he says.
“A mobile-wallet provider that works with Giftango can allow users to access the wallet in a wide variety of ways: merchant website, channel distribution, promotions, social media and now directly from plastic,” Nelsen says. “This is one piece to a big puzzle.”
Giftango hopes to have participating merchants issuing cards with barcodes in time for the holidays. Merchants first would need to phase out its current offerings before introducing the new cards. That process could take as long as six months, Nelsen says.
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