New Media Insight Group and Loop are promoting different types of mobile payment technology designed to avoid interoperability issues with current payment terminals.

"Most of the mobile payment solutions that are out there require hardware, software and staff training," says Michael Palethorpe, CEO of New Media Insight Group, which just released a mobile acceptance product called CloudPay. "That’s too much work."

The CloudPay app enables wireless payments between devices used by the merchant and consumer. Payments are treated as account-to-account transfers between mobile wallets, so they do not incur credit card transaction fees. CloudPay charges 0.5% per transaction.

Consumers use CloudPay by selecting a merchant in the app, entering an amount to pay and clicking "send." The process resembles that of Square Wallet or the PayPal app, though in those examples the shopper only checks in, and the merchant must handle the payment process from that point forward.

"If the merchant user has a connected computer, a smartphone or a WiFi device, they can accept payments," Palethorpe says. New Media Insight Group developed CloudPay with a technology partner in Canada that Palethorpe would not name.

Other mobile payment companies are also trying to eliminate work for the merchant, but are taking a different technological approach. MoonClerk, for example, provides prewritten code for merchants to build payments acceptance programs off of Stripe's API.

And Loop recently released LoopWallet, which allows a signal from the consumer's smartphone to mimic a swiped card transaction. The LoopWallet app generates a magnetic field to communicate with the merchant's terminal, which interprets the signal as a card swipe, says Damian Balsan, one of Loop's cofounders.

"The typical magnetic stripe card in fact does issue a very small magnetic field to transmit the data to the head of the [reader]," Balsan says. "What we do is amplify the signal."

Consumers manage LoopWallet in a manner similar to Coin, a multi-purse payment card. With both products, there is some hardware required on the consumer's end — users attach a reader to a smartphone to swipe payment cards to load them onto the LoopWallet app or the Coin card.

When paying, consumers open the LoopWallet app, choose a payment or gift card, and place the mobile device near the point of sale terminal.  The app is PIN protected, which shields the cards if the mobile device is lost, Balsan says.

"You hold the device in the same place where you would swipe a card," Balsan says. "If it's an EMV terminal, it would still have a mag stripe reader. I'm able to use the LoopWallet in France, for example."

Loop was also designed to avoid the learning curve that is inherent with most new technology, Balsan says.

"It's an intuitive experience. Consumers are accustomed to identifying where the swiper is, and now we're just telling them to use their phones," Balsan says.

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