BitPay proves Apple Pay is just “sexy tech”, it does nothing to reduce merchant fees
Between $2 and $4 on every $100 spent using a credit card goes to the banks, even though it costs only a few pennies to process the transaction.
BitPay Brings NFC to Bitcoin in new Bitcoin Checkout App
BitPay’s newest Point-Of-Sale Bitcoin Checkout App now available on the Google Play Store is the first to use NFC technology for Bitcoin payments.
The Wall Street Journal timed it perfectly this morning, when they published an op-ed piece, written by Lyle Beckwith titled “The Worm in Apple Pay”. Mr. Beckwith is an executive for the National Association of Convenience Stores, so his unique insight in understanding the pain points of retailers made for a very good read. Though he did not address bitcoin specifically, he made clear the hurdles that Mastercard and Visa face in competing with bitcoin, having only their legacy payment systems to fall back on.
He went on to say, though Apple Pay is good for the mobile payment ecosystem, it falls “short of revolutionary change—because it built its product on the flawed credit-card payment system” and it does nothing to address the extortionary “swipe fees” that merchants must pay every time a customer pays with a card. He added that convenience stores paid $11 billion in swipe fees last year alone.
When Apple announced Apple Pay, most people in the bitcoin community weren’t threatened, many opined that it wouldn’t solve the problems of security, privacy and high fees that plague current payment networks. In fact, it just adds another layer for merchants to comply with, thus creating more burden on the transaction, which will eventually lead to increased costs to the consumer.
Bitpay announces one tap payment feature enabled by NFC
Today at the Money20/20 conference in Las Vegas, Bitpay had their answer to Apple Pay and it’s called Bitcoin Checkout. Bitpay’s one-tap mobile bitcoin payments product is a new point-of-sale app that allows merchants to accept bitcoin payments on a mobile device. This is one of Bitpay’s strongest endeavors in a long line of recent moves to bring bitcoin transactions to the mainstream. And they are now rolling out the app to every mobile market on the globe, in over 35 languages spoken by 99.99% of the world’s population. The application is available for Android gadgets as of now and will soon be ready for iOS.
The key feature that excites us the most about their one tap payment application is that it is powered by NFC, a form of short-range wireless communication that is much smaller than the standard carrier signal, it is perfect for private monetary transactions, because the very short range of NFC makes it difficult to eavesdrop on.
Bitpay clearly has a better value proposition for merchants
“For retailers, accepting mobile payments is a growing trend, but none of today’s industry offerings can provide a lower risk or lower cost than swiping a credit card,” said Tony Gallippi, co-founder and executive chairman of BitPay. “Accepting bitcoin can offer tremendous savings to merchants, especially merchants with a large international customer base, and BitPay’s service combined with the new mobile app is a fantastic value for merchants.”
The Bitpay merchant demographic is different than those who enable Apple Pay at checkout
Bitcoin is different, still in its infancy, it is being used by merchants who know and trust the technology, die hards, if you will. More importantly, Bitcoin is very popular in nations where their is a thriving black-market for fiat-money and a culture of entrepreneurship. In Argentina, inflation is pegged around 40% – though the official figure is 30%, most recent estimates have the United States dollar being traded at about 15 pesos on the black market, that is almost double the official rate.
Bitpay’s strategic focus on international markets will help it gain traction rather quickly with medium size enterprises that go beyond the small time merchant. “The checkout that we had on the phone was designed for a simple street vendor or a one-person shop, whereas this app can handle hundreds of employees,” Gallippi said. “It’s really designed for a more medium-sized business.”
The Argentine peso is hitting record lows against the U.S. dollar
With Argentina in default on a very large piece of its sovereign debt, citizens will turn to Bitpay over Apple because Apple Pay does nothing to help their families or bottom line. In one year, Argentinian citizen’s currency has lost half its value. Argentinian merchants will be the first ones to use Bitpay, especially those that run businesses that cater to tourists.
Bitcoin is very popular in China. Alibaba.com, a business-to-business portal that connects Chinese manufacturers with overseas buyers recently announced they did 1.1 trillion yuan ($170 billion) in sales.
Though the company primarily operates in the People’s Republic of China, where there are strict capital controls in place, many Alibaba merchants would consider Bitpay as an attractive alternative, even more so, due to the fact that there are restrictions with what they can do with their own money.
As bitcoin continues to lead the way as the most efficient and effective means to transfer money around the world, Bitpay is well positioned to be the global leader in this space.