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Look Ma, No Card Reader: New App Captures Card Numbers for POS Transactions
December 5, 2013

By Kevin Woodward

A new point-of-sale card-acceptance app expected to be available in early 2014 will use pattern-recognition technology to capture a payment card number, potentially speeding up an in-store transaction and eliminating the need for a card reader.

Image Credit: Tantrum Street
The Scan button starts the payment transaction

Cartwheel Register, developed by Dallas-based Tantrum Street LLC, is in testing now with 15 Dallas-area merchants, including gift shops, cafes, apparel stores, bakeries, caterers, and salons. They’ll use the app on iPads during the holiday season and test its loyalty and analytics features. Currently, Cartwheel Register is only available for devices using iOS from Apple Inc., which includes iPads and iPhones.

Cartwheel Register eschews a card reader that plugs into the audio jack in favor of software that recognizes card numbers when the customer holds her card in front of a mobile device’s camera. The app does not take a photo of the card. Cartwheel scans the card to get the card number. Then, and this is only for the first use of the card in the system, the customer enters her card-verification code, expiration date, and ZIP code. Subsequent use of the card within Cartwheel does not require the additional data. Then the customer signs the screen and is emailed a receipt.

The missing card swipe does carry a penalty for the merchant. Transactions are treated as card-not-present, says William Cervin, co-founder and chief executive, which results in somewhat higher interchange cost.

Currently, merchants can use their own merchant accounts or use one from Cartwheel, Cervin says. The Cartwheel transaction rate is still in development, he says, with the goal of making it as competitive with a card-present rate as possible. Tantrum Street is working with its acquirer on this, he says. Cervin will not disclose the acquirer’s identity.

Tantrum Street has two ways of making money when merchants use the Cartwheel app. If the merchant processes via a Tantrum Street account, the company will get a cut of the processing fee. If the merchant uses its own merchant account, Tantrum Street will charge an undisclosed monthly fee. A typical merchant would have an average ticket of at least $25, he says.

The app also can be used with cash transactions and with Tantrum Street’s Skip Wallet, which is in development and enables consumers to store credit, debit, and prepaid cards for use as payment within Cartwheel Register. Cervin expects the free Skip Wallet to be available in early 2014, with a test starting in a couple of weeks. Consumers can enter their payment cards using the same scanning technology in the Cartwheel app. Consumers must use a PIN to either open the Skip Wallet app or authorize a transaction within the app, Cervin says.

Security is a priority, too. Cervin says all card data are encrypted between the phone and the Cartwheel servers.

Tantrum Street is targeting small merchants, he says. “We wanted to simplify the lives of these small businesses,” Cervin says. The POS app not only accepts payments, but also is planned to enable merchants to manage loyalty and customer-acquisition programs. “The genesis of this company is around the next generation of how consumers and businesses interact with each other,” he says.

Cervin expects to use multiple ways to market Cartwheel to merchants, including independent sales organizations. “Our acquirer is very interested in using its sales force to augment our marketing strategy,” Cervin says. He would not release details of any possible sales incentives, saying those details were still in development.


Cervin says apps for devices using Google Inc.’s Android and Microsoft Corp.’s Windows Phone operating systems likely will be available in the next several months.

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