It’s about the size and shape of a cork and it connects to a smartphone. And if Intuit Inc. of Mountain View, California has its way, it will change the landscape of the Canadian payment system.
The GoPayment credit card reader is free for merchants — unlike conventional card readers — and no contract is required, according to Intuit, which unveiled the product on Tuesday.
But there’s a rub: Intuit collects a fee of 2.7% for every transaction, or 3.7% if the credit card data is manually keyed in. If it catches on, GoPayment could become a key growth opportunity for Intuit.
The product, which is already available in the U.S., is aimed at small businesses which maybe lack the resources to invest in a conventional machine. The Canadian launch is the first part of a broader international roll-out for GoPayment.
The Canadian payment system is an important source of revenue for credit card companies such as VISA and MasterCard as well as banks. As more transactions move online, there have been calls for the Canadian Payments Association, a non-profit organization that runs the payments system, to provide consumers with more choices in the way purchases are made. Critics argue that while citizens of some developing countries can use their mobile phones to make payments, the technology is still in its infancy in Canada.
Late last year NetSecure Technologies of Regina became the first to launch a mobile card reader with its Kudos product, which operates much like GoPayment.
In 2011, consumers around the world spent more than $85-billion on mobile transactions. The number is expected to reach $670-billion by 2015, according to NetSecure.
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