Digital Transactions Authoritative, insightful and timely information for payments professionals
The hype still abounds, but mobile payments and banking seem to be taking some concrete steps this week toward wider adoption.
–Mitek Systems Inc., the leading developer of software for mobile remote deposit capture, on Monday announced that five of the nation’s 10 largest retail banks now use its flagship Mobile Deposit application. New adopters include Bank of America Corp. and Capital One Financial Corp., the nation’s No. 1 and 8 retail banks by assets, respectively. Some 40 banks now use Mobile Deposit, with 26 signed in the last quarter. Other clients include JPMorgan Chase & Co., U.S. Bancorp, and PayPal Inc.
In its earnings release for fiscal 2011’s second quarter ended March 31, Mitek said BofA and Capital One are adopting Mobile Deposit through one of the company’s channel partners, NCR Corp. Mitek’s software enables banks and credit unions to offer customers the ability to take pictures of checks on their smart phones and upload the images for deposit through online-banking applications.
“We continue to see an unprecedented level of interest in Mobile Deposit in our core banking channel and across the entire payments industry,” Mitek president and chief executive James B. DeBello said in the release. “After success last year in partnering with the financial industry’s top solutions providers, 2011 is the year deployment of Mobile Deposit is hitting its stride.”
Mitek reported revenues of $2.87 million in the quarter, up 89% from $1.52 million in 2010’s second quarter. Net income jumped to $570,000 from $7,000 last year. “The smart phone is changing the way in which we live,” DeBello said in a conference call with analysts, later adding that “the pace of deals has accelerated.” DeBello also expects a bank to roll out the company’s smart-phone-based bill-payment service later this year.
Mitek announced that it completed a $15 million private placement of its common stock in a transaction managed by William Blair & Co. San Diego-based Mitek will use the funds for expansion. As a result, the company also will seek listing of its shares on the NASDAQ Capital Market.
–Also on Monday, Micros Systems Inc., the developer of specialty applications for the hospitality and retail industries, announced that it would embed Tabbedout, a mobile-payment application from Austin, Texas-based ATX Innovation Inc., into its software for bars and other hospitality locations. More than 200 establishments already use Tabbedout, and in the news release ATX said the deal with Columbia, Md.-based Micros could add many more.
Customers download the free Tabbedout app to their iPhone or smart phone running Google Inc.’s Android operating system. The app stores their card data on the smart phone and enables patrons to view and pay bar tabs without cash. A random secret code is displayed on the screen each time a consumer opens a tab, the only information the consumer needs to provide the server or bartender, the release says. Customers can use Tabbedout’s integration with social networks to tell friends where they are or where they will be going next. Receipts can be e-mailed automatically, and customers also can call a local cab using the app’s “Cabbedout” feature.
–Last Thursday, Visa Inc. executive chairman and chief executive Joseph W. Saunders said Visa would make an announcement about “our global e-commerce and mobile strategy” toward the middle or end of this week. Saunders, speaking to analysts after announcing Visa’s quarterly earnings, didn’t give details, but the company has a number of mobile-payments initiatives going directly and with some banks. Visa recently invested in the hot mobile-payments startup Square Inc.
–Meanwhile, Isis, the mobile-payments joint venture of AT&T, Verizon Wireless, and T-Mobile USA, is claiming that a recent Wall Street Journal article disclosing that it was abandoning efforts to build its own merchant network was misleading. The story spawned more than 200 other news and blog reports, including one by Digital Transactions News. The article was correct about the network issue, Jaymee Johnson, head of marketing at New York City-based Isis, tells Digital Transactions News, but he says the impression it left was that Isis was scaling back. “Isis is in no way scaling back on any of our plans, we are in fact accelerating,” he says.
Johnson says that based on payments-industry interest, Isis is now using an open model as it develops its mobile wallet and is working with the major card networks, as well as merchant acquirers and others to sign merchants. The wallet will enable payments as well as give retailers the ability offer targeted coupons and messages to customers via smart phones.
