Accel-backed online payment company Braintree has released a set of tools for mobile app developers that enable merchants to accept payments within an app. The tools include development libraries and example applications for mobile devices running Android, iOS, or Windows Phone 7 operating systems.

US-based Braintree runs an online payments platform (featuring a merchant account, payment gateway, recurring billing and credit card storage) that allows online businesses to process credit card payments. The company is processing more than $4 billion in annual credit card volume from more than 2,000 merchants. Braintree sees a strong interest from mobile app developers: “Braintree handles a tremendous amount of mobile payments volume today and these new client libraries solve a problem for mobile app developers who want to provide the simplest and most elegant purchasing experience for the customer, instead of using a web browser simulated to look like the app,” commented Braintree’s CEO Bill Ready.

With Braintree’s solution the credit card data is encrypted when it is entered by the user. The encrypted data is then transferred to Braintree to process the transaction. As a result merchants don’t have access to sensitive card details and are avoiding PCI compliance issues.

Irish mobile payment start-up boxPAY has opened on office in San Francisco, California and is now offering mobile carrier billing in the US and Canada.

boxPAY provides Premium-SMS and direct carrier billing solutions, enabling e-businesses to charge their customers for digital content through a mobile phone instead of a credit card. The company offers in-app, one-touch billing on the Android platform, as well as subscription billing in more than 40 countries.

“The move to North America was crucial to boxPAY’s global expansion because of the significant amount of cellular subscribers in Canada and the US. We needed to offer our merchants from all over the globe access to these 350 million+ customers, especially because of the fact that mobile users here are comfortable with mobile payments,” commented boxPAY’s Co-Founder Gavin McConnon.

Global banking and financial services giant Barclays has entered the mobile money market by releasing Pingit, a mobile person-to-person (p2p) payment service. The Pingit app (available for Android, BlackBerry and iOS devices) allows users to receive and send money using their mobile phones.

With the launch of Pingit Barclays tries to gain ground in the emerging mobile payment market. At the moment the service is limited to customers that have a Barclays UK current account and a UK mobile phone number but will be will be available for all UK current account customers soon.

Pingit links the user’s bank account with their mobile phone number. This allows customers to send and receive money using their mobile phone number without the need to share bank details. The actual transaction is processed using the Faster Payments service and takes just a few seconds so complete.

Check out the video to see how Barclays Pingit service works:

Last week at FinovateEurope, 35 companies showcased their latest innovations in payment, financial, and banking technology. It was the second time that the show, a spin-off of the American Finovate conference series, took place in London. What makes the event really special is the format: all companies have only 7 minutes time on stage to demo their services and are not allowed to use slides. Among the companies have been startups as well as large and established players presenting their innovations.

Best of Show 2012

After the presentations, the event’s attendees could vote their favorite demos. This year’s best of show winners are:

• Cardlytics (together with Aimia) presented its transaction driven marketing platform that brings banks and merchants together to provide tailored rewards to their customers.
• Dynamics which demonstrated its Chip&Choice card, a battery-powered multiple application card featuring EMV-technology.
• eToro showed Guru Finder which allows users to find and implement personalized trading strategies on the company’s OpenBook trading platform.
• Nutmeg showed its customizable online investment management service.

Some companies launched new services at the event:

• Electronic payment innovator Ixaris, the company that developed EntroPay, launched Opn Cardworks, a payment application which enables businesses to quickly set up a personalized prepaid card solution.
• IND Group released its renewed Banking Front-Office product, with Gamification as the main idea. The goal is to make the banking processes more fun and motivate clients to use the bank’s online services more often.

Focus: Mobile

One of the main topics at this year’s FinovateEurope was mobile technology:

• US-based financial services systems giant Fiserv showed M-Cash, a white label mobile payment service.
• Mobile payment company Luup presented a mobile travel authorization and budget management service.
• Validsoft demoed its voice-based authentication technology for mobile and online banking.
• Handpoint showed an interesting white label mobile Chip&PIN payment solution.
• Finsphere presented its security solution that uses the location of the cardholder’s mobile phone relative to the location of the financial transaction.

Mobile payment company Buck, formerly known as Billing Revolution just announced the launch of its new single-click credit card checkout for mobile devices. The company also announced new partners that will integrate Buck’s payment solution, including Glamour, SpyderLynk, Papaya Mobile and Braintree.

Buck enables users to purchase digital and physical goods via their mobile phones. Unlike other solutions, the company offers single-click mobile credit card payments with no account, username or password required: After the first transaction with Buck, where the user has to provide his credit card details, the user’s mobile device will be automatically recognized by all Buck powered merchants. According to Buck, the payment platform supports all major credit cards and is PCI Level 1 compliant.

Buck’s service is an interesting alternative to carrier based billing platforms and can be used to realize innovative shopping solutions such as The Glamour Apothecary Wall which lets consumers buy beauty products directly from the magazine.

Munich-based Wirecard Bank, a Wirecard Group company, and convenient store supplier Lekkerland are expanding their strategic alliance and announce BarPay, a new e-commerce payment method in Germany.

In cooperation with Berlin-based EZV Gesellschaft für Zahlungssysteme, the companies have developed BarPay to allow cash payments for products ordered online. The new payment service enables customers in Germany to order goods or services on the Internet and to pay for them in cash at 18,000 petrol stations, shops and kiosks supplied by Lekkerland network in Germany. BarPay is designed for consumers that don’t have access to credit cards, don’t want to pay in advance, or don’t trust in online payment services such as PayPal.

According to Lekkerland the flexible opening hours of convenient stores and petrol stations make BarPay a user-friendly payment method. The company’s Executive Vice President Jonny Natelberg commented: “Our national infrastructure ensures that almost all consumers can reach one of our BarPay acceptance agents within a maximum of ten minutes.”

Advertising agency Digitas has released a study on social commerce and created an infographic presenting the key findings. Enjoy!

Google is suspending the provision of prepaid credit cards to its mobile wallet app after a security flaw was exposed last week. Osama Bedier, Vice President of Google Wallet and Payments said in a post on Google’s commerce blog: “…to address an issue that could have allowed unauthorized use of an existing prepaid card balance if someone recovered a lost phone without a screen lock, tonight we temporarily disabled provisioning of prepaid cards.”

Over the last week two potential vulnerabilities of Google Wallet have been exposed. First, security firm Zvelo found that the PIN for Google Wallet wasn’t stored in the secure element of the phone and thus could be revealed by a brute force attack on phones that are rooted (the user has system-level access). The second security issue is even more serious as it seems to be a flaw in the wallet’s design: after clearing all data and reconfiguring the Google Wallet app a unauthorized user can get access to the previously stored prepaid card balance.

The security flaws have received widespread coverage around the world and will certainly not help to increase the general adoption of NFC-based payment methods. Google addresses both issues, pointing out that “Google Wallet offers advantages over the plastic cards and folded wallets in use today”. Until the issues are fixed, the company discourages its users of rooting their phone and disables provisioning of prepaid cards.

Online payment service provider Ogone has recently opened an office in the US and appointed James Byler to the role of Regional Head of North America. With this expansion Ogone wants to open the European e-commerce markets to US companies and establish local partnerships to further Ogone’s distribution network.

The Belgium-based company is connected with more than 200 banks and acquirers to provide more than 80 international, alternative and prominent local payment methods in Europe, Asia, Latin America and the Middle East. Local payment methods include ELV and giropay in Germany, Carte Bleue in France, iDeal and Machtigingen in the Netherlands, and Bancontact/Mister Cash in Belgium.

As part of their expansion program Ogone acquired India’s second largest online payment provider E-Billing Solutions (EBS) in 2011. This was Ogone’s first acquisition and its first move outside the European market. According to the company, expanding to the US was the next logical step and will help to evolve from a European to a world player.

Barbaros Özbugutu, VP Sales Germany at Klarna

Klarna provides a payment service that enables online merchants to offer their customers the option to pay by invoice or installments after the delivery of their goods. We had the chance to talk to Barbaros Özbugutu, Vice President Sales Germany of Klarna about Klarna and invoice-based payment services in e-commerce.

Payment Observer: Can you give us some background information and numbers on Klarna?

Barbaros Özbugutu: Klarna was founded in Sweden in 2005. Since then – with more than 14,000 online merchants and yearly transactions of currently EUR 1.9 billion – we have become the European leader for invoice-based payment solutions in the e-commerce market. Last year, we managed to double revenues company-wide. In Germany, where we launched in 2010, we grew by 1,100 percent.

Payment Observer: What services does Klarna provide?

Barbaros Özbugutu: At Klarna, we offer two secure and user-friendly payment solutions for online shopping, Klarna invoice and Klarna account. Klarna invoice allows customers to shop in a convenient way through a very simple concept: they don’t pay for the goods until after they have received them. With Klarna account, we extended our service by also offering the option to pay in a chosen amount of monthly installments. On top of that, if customers order a number of goods using Klarna account, we bundle everything into one monthly invoice, helping shoppers to keep track of their purchases.

Payment Observer: How does it work in detail, do you completely take the default risk?

Barbaros Özbugutu: Our goal is to enable a smooth shopping experience for both customers and merchants. So, as soon as a customer purchases an item in an online store through Klarna, we step in and take care of the rest of the payment process. For merchants, this means they can quickly dispatch the goods and focus on more important things than waiting for the payment to come in. We will pay them and assume all credit and fraud risk. Customers, on the other hand, actually receive their order before they have to pay. What’s equally important is that they only have to give out a minimal amount of personal information at checkout: there are no complicated forms to fill out nor login information to remember. All that we ask for is the customer’s name, date of birth and address.

Payment Observer: What was the motivation to start such services, how can online merchants profit?

Barbaros Özbugutu: Klarna’s services stem from the idea of making online payments safer, easier and more transparent. Before we began, we looked at a number of customer studies dealing with online shopping. Many of them asked: “How do you pay online?” The question much more relevant to us, however, was: “How would you like to pay?” We quickly realized that a great number of customers were not satisfied with the sometimes cumbersome payment processes. Particularly with regard to upfront payment, many shoppers are left feeling uneasy, afraid of falling victim to fraud. With Klarna invoice, customers pay after they receive and examine the goods they ordered. This way they can make sure they only end up paying for what they really want.

Klarna's Invoice-based Payment Solution

At the same time, we did not only have the customer’s needs in mind when we created our services; online sellers profit from integrating Klarna’s payment solutions just as well. A quick look at the numbers supports our approach to online payment: on average, sales increase by twenty percent after merchants start offering Klarna’s payment solutions. Compared to other methods, invoice payment offers the highest conversion rate.

Payment Observer: Klarna recently received a huge funding of $155M led by General Atlantic and DST Global – How did this come about?

Barbaros Özbugutu: Naturally, investors are always on the look-out for interesting trends and developments in the market. With DST Global and General Atlantic, we were fortunate enough to attract two top investors after already having received support for our growth through Sequoia Capital in 2010. Given their previous investments in internet start-ups like Twitter and Facebook, both investors have clearly demonstrated their expertise in this sector, so we are extremely pleased to gain their support as well.

Payment Observer: What are your company’s plans for the future?

Barbaros Özbugutu: We see a great amount of potential here in Germany. The success so far has confirmed our growth strategy, so we will continue to follow this path. At the moment, we are expanding our capacities with regard to staff as well as infrastructure. In Cologne, for example, we have recently set up another office in addition to our German headquarters in Nuremberg.

Payment Observer: What are your top e-commerce trends for 2012?

Barbaros Özbugutu: I believe that invoice payments will continue to be an important issue for online merchants. In our opinion, it will be crucial for online merchants to cater to the needs of their customers, as the fundamental rule here is quite simple: the easier the virtual payment, the higher the chances that a website visitor actually becomes a customer. For retailers, this means reducing the payment process ideally to just one click while, at the same time, asking for as little client information as possible. With that said, after delivery payment represents the ideal solution as it separates the payment process from the actual purchase, thereby requiring no more than the customer’s name, address and date of birth.

Our commitment to making online payment as simple and safe as possible is reflected in our “Zero Friction Vision”. In this vision, the relation between customer and merchant is shaped by mutual trust, allowing the e-commerce market to further expand and flourish. In 2012, e-commerce could take a significant step in that direction. At Klarna, we certainly will continue to work on making this vision become reality.