Moneta Corp. is changing its name to Rialto Commerce and plans to refocus its strategy. Instead of working directly with banks, the company plans to work with service providers to persuade their client banks to adopt its online-payment service, PaymentsSource has learned.
Rialto Pay, the new name for the original Moneta offering, enables online merchants to receive payment directly from bank customers’ accounts through the automated clearinghouse system. The Atlanta-based company this week plans to relaunch its concept, touted as a lower-cost bank alternative to PayPal Inc., and will add instant-credit payments for online purchases through a partnership it formed late last year with credit bureau Equifax Inc., a spokesperson says.
The option would be akin to PayPal’s BillMeLater service. Bank customers whose credit Equifax approves would be able to make online purchases and pay for them later, bypassing traditional credit card networks and yielding additional incremental transaction revenue for banks.
Rialto Pay is designed to generate “incremental e-commerce revenue” for both banks and merchants by providing merchants with lower-than-average transaction fees and sharing transaction-fee revenue with its partner banks, the company says. Rialto Pay also is designed to provide a more-secure channel for bank customers uneasy or unable to make online purchases using a credit or debit card, the spokesperson says.
Like PayPal, the concept requires merchants to add Rialto Pay as an option on their websites and banks to offer the service to their customers. But the company, which launched in 2007, so far has failed to gain adoption among banks, and one analyst says its new face may be its last chance at success.
“There could be a window of opportunity here, but concepts like Moneta are quickly running out of time to find success with banks,” Aaron McPherson, financial services practice director at Framingham, Mass.-based IDC Financial Insights, tells PaymentsSource. “As mobile payments begin to take shape through handsets, banks are feeling more confident about their future roles and less concerned about being disintermediated by companies like PayPal. They are unlikely to invest a lot of time in startup e-commerce services,” he says.
Moneta earlier this year declared a success a three-month test it conducted in late 2009 with SunTrust Banks Inc., but so far no other banks have come aboard. Rialto maintains relationships with some 25 e-commerce vendors that were part of its SunTrust test, including Delta Air Lines, Shoebuy.com and Stacks and Stacks, Rialto’s spokesperson says.
SunTrust, meanwhile, continues to work with ModaSolutions Corp.’s eBillme payment system following another test that began last fall. Ebillme enables merchants to issue invoices for online purchases that customers authorize for payment through their banks’ bill-payment websites.
That relationship continues to show promising results, including encouraging more bank customers to use the institution’s online bill-payment service (
Rialto is not the first to try going through third-party channels to sell e-commerce payment services to banks. PayPal a year ago signed agreements with technology vendors Fidelity National Information Services and S1 Corp. to enable banks to offer PayPal’s service for sending and receiving electronic payments to their core customers (
Some banks may be interested in inking deals with alternative payments providers, but PayPal appears to have a substantial head start on upstarts, McPherson says.
“The graveyard is littered with companies that have tried to compete with PayPal,” he says. “If the new version of Moneta doesn’t sign up a substantial partner within six months, they won’t survive.”
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