Mobile-payments processor Rev Worldwide is offering merchants in emerging markets a way to accept payments without a bank account.
Merchants can use the RevCoin mobile payment system in place of both a bank account and a point of sale terminal, Bertrand Sosa, co-founder and president of Rev Worldwide, tells PaymentsSource.
The merchant downloads the iPhone or Android RevCoin application for free. After enrolling, the merchant pays $9.99 for a starter kit. Rev Worldwide refunds that fee after the merchant processes $400 of sales through the application.
The kit includes a card reader and a prepaid MasterCard debit card. The reader plugs into a smartphone's headphone jack and can be used to accept credit or debit card payments. Merchants pay Rev a card-present transaction fee of 2.55%. For card-not-present transactions, Rev charges 3.55% plus 15 cents. Rev represents the merchant and prepaid business debit card accounts that are managed by McAllen, Texas-based Inter National Bank Financial Corp.
The merchant can send customers receipts by e-mail. Merchants can also provide refunds for free if the RevCoin account has enough funds.
As of its June 7 launch, which is U.S.-only, RevCoin accepts only MasterCard and Visa cards, says Sosa. Rev Worldwide plans to add more card brands.
The RevCoin account is insured by FDIC through Inter National Bank. Merchants can load the prepaid account either by transferring funds from the revenue account or by visiting a participating money transfer location. There is a temporary limit on how much revenue the merchant can bring in and spend, says Sosa; the maximum transaction is $500 and the daily limit is $10,000.
Merchants can access up to $500 immediately, between $500 and $2,000 within 24 hours, and over $2,000 within 48 hours. Rev charges a $2 fee for using the prepaid card to withdraw cash at an ATM, Sosa says.
As a participating member of the Clinton Global Initiative America Panel on Financial Inclusion, Rev will have connections into developing countries, Sosa says. Mexico and Latin America are its first expansion targets this year, followed by Asia, the Pacific and Europe.
"We're talking about a half-billion merchants (globally) that currently don't have access to these types of products," says Sosa. "We're pretty excited about opportunities outside the U.S."
Rev does not store card data on the device, and all transaction information is encrypted before submission to Rev's servers, according to the company's website.
RevCoin appears to solve a variety of issues for underbanked merchants, Auriemma Consulting Group managing director Matt Simester tells PaymentsSource.
"It's completely flexible in terms of how the merchant wants to build the business," he says. "This is a very encouraging model to attack emerging markets. The instant access is very advantageous and that's where it will compete against cash."
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