Digital Transactions Authoritative, insightful and timely information for payments professionals
A startup called Zooz this week announced it has registered more than 1,000 developers for a payment plug-in that, the company says, streamlines card-based payments while users are within an app. Zooz, whose product is available for both Android and Apple iOS devices, also launched an HTML5 version to allow users of older devices to take advantage of the service through their mobile browser.
Founded about 18 months ago, Zooz says its payment product raises conversion rates for app developers by letting users make payments without leaving the app and without having to repeatedly type in card credentials. It makes its product available to developers as a software development kit consisting of three lines of code, allowing the plug-in to be integrated in a matter of minutes. “It’s only three lines of code so [developers] don’t have to work too hard,” quips Oren Levy, chief executive of the Israeli company, which also has an office in San Francisco.
With Zooz, app users enter card details once and can then use that card for subsequent transactions, on that app or any other app that accepts Zooz, by choosing it on the screen. The user may also enter a PayPal user-name and password, which the cloud-based service will also remember for subsequent transactions. The service is keyed to a specific device, so users can pay at any Zooz-accepting app so long as they are using the same device with which they originally entered their card or digital-wallet details. “We want to be the VeriSign of payments in apps,” Levy says, referring to Zooz’s security approach.
Some 1,100 developers have signed up to use Zooz since the product launched March 21, Levy says. “The word is spreading,” he notes. “I think we’re the only company that offers [an in-app] SDK with multiple payment options.” Developers pay 2.8% plus 19 cents per card transaction. PayPal payments simply carry ordinary PayPal rates.
By streamlining both developer integration and the user experience, Zooz solves a longstanding problem in mobile payments, Levy argues. In-app payments have suffered from solutions that are hard to integrate and that users find frustrating to use, he says. As a result, users either abandon the transaction or get routed to a Web site to complete it. A common solution up to now has relied on carrier billing, a method that speeds up transactions by allowing users to charge purchases to their mobile-phone or land-line account. But carriers also levy hefty fees to merchants.
“This is a significant challenge a lot of people are trying to overcome,” notes Rick Oglesby, a senior analyst at Boston-based research firm Aite Group LLC who follows mobile payments. Once a frustrated consumer has gone online, “switching to another merchant is so easy,” he says.
Despite the difficulties, in-app payments are expected to grow to $11.6 billion this year from $9 billion in 2011, according to figures from Appcelerator/IDC.
