New Money and Payments

The last couple of days there have been several blogs reporting on new types of money and payments.

First there was the great interview of Steve Boyd with Jamais Cascio.

Some highlights of the highlights:

You have to get a critical mass of people to agree in a new fantasy.

Groups with shared purposes could in fact have new currencies.

The unbanked are the source of many innovations in the world, right now.

Governments start to care when economies arise.

The question of anonymous money and the roll of cell phones in future money.

Then there were 2 news items on micropayments to news publishers:

The first one related to a New platform for micropayments to news publishers

The key comment in the Spingwise article being that:

…for bitcents to work, it will need to attract enough publishers who produce content that readers are willing to pay for. Meanwhile, other ventures—like the soon-to-be-launched Journalism Online—are also working to create a new economic model for the news industry. Keep a close eye on this space—change is in the air, and business opportunities won’t be far behind.

Especially if the big boys want a piece of the cake. Here comes Google again.

I found this one via my Twine subsription, and Nova Spivak was the first one posting it.

Again, some highlights only:

Google is developing a micropayment platform that will be “available to both Google and non-Google properties within the next year,” according to a document the company submitted to the Newspaper Association of America. The system, an extension of Google Checkout, would be a new and unexpected option for the news industry as it considers how to charge for content online.

While currently in the early planning stages, micropayments will be a payment vehicle available to both Google and non-Google properties within the next year. The idea is to allow viable payments of a penny to several dollars by aggregating purchases across merchants and over time. Google will mitigate the risk of non-payment by assigning credit limits based on past purchasing behavior and having credit card instruments on file for those with higher credit limits and using our proprietary risk engines to track abuse or fraud. Merchant integration will be extremely simple. [grey bold emphasis Google]

In a brief paragraph entitled “business model,” Google suggests that it would share revenue in a similar fashion to the iTunes App Store and its own Android Market, both of which take a 30% cut of revenue.

I downloaded the document and besides what’s covered in the blog post, it contains some other interesting facts about Google Checkout:

Key statistics:
• Tens of millions of registered Checkout users
• Several hundred thousand registered merchants, high number of sellers selling digital
goods
• $ Billions of orders processed

Planned Roadmap:
• Simplified Merchant Integration – Dramatically increase the speed by which merchants
integrate with Google Checkout. Target early 2010
• Guest Checkout – Allow users to buy goods with Checkout-enabled merchants without
creating an account. Target Q4 2009
• Stored Value – Gift cards and maintaining a balance for buyers on Google Checkout.
Planned for future
• Micropayments – Aggregation of small payments by buyers for purchasing digital
content. Planned for future

The PDF also mentions some really interesting thinking on what i would call “convenience” in a multi-vendor marketplace environment:

Easy Subscription Sign-up and Management for Users Plus Content
Packaging and Multiple Payment Forms for Publishers
o Single sign-on capability so users can use one login for access to premium content and a central place to manage subscriptions and payments.
o We envision the typical scenario to be where a user pays a monthly fee for access to a wide-ranging package of premium content. One example of a "package" might be full access to the WSJ; another "package" might include the top 10 business publications. Google believes that there is real power and benefit to publishers in providing these sorts of broad, multi-publication access passes.
o For multi-publication packages, publishers will receive a revenue disbursement that is proportional to the usage of their content in the package.
o While providing an option for micropayments will be important, we do not believe it will be the norm for accessing content. Example 1: A user has access to the "basic" premium content package. She hears about the latest Sarah Palin article in Vanity Fair, which  is not part of her package. She can make a one-off payment of $0.10 to read that article, which will show up on her bill as part of the monthly payment.

Just think: replace publishers by financial services providers, and micropayments by regular monthly payments. Sounds like a marketplace for financial services. With a single-sign on for the marketplace syndicated/federated to the underlying providers of services. But i am deviating, this post is about new money and payment systems.

Last but not least there is the iPhone Payment App by Twitter creator Jack Dorsey:

Here are the dongles again ! And i thought that the whole idea of smartcards, USB-Tokens, and other physical tokens were gone, as they do in my opinion no sense in a mobile world. Wrong again, Peter ! (Don’t worry, i am stubborn 😉

The innovation is in a small, plastic card reader that fits in to the headphone jack of an iPhone (or iPod Touch) and transfers the credit card’s swipe data to the app. After the employee enters the amount to charge, the customer confirms by scrawling their signature with their finger and then either one enters the customer’s email address to send the receipt to. The payment is processed by Square for a small percentage plus a fixed fee; the funds are transferred directly to the store’s bank account, cutting both time and complexity on the processing side. The customer’s receipt includes a map showing the location of the transaction which is handy for those who record, sort and file such things.

Jack Dorsey (please DO read the man’s Wikipedia bio), the man who all but built Twitter in a matter of two weeks, has been working on a half-secret start-up project since around May. His new venture — dubbed, funnily enough, Squirrel — is based around the concept of using the iPhone as… yep, a portable, personal cash register; essentially the exact device which Square has created

Two links if you want to know more. Here and Here.

Big changes coming in this area. Have you seen any bank involved in these innovations ?