Startup’s mobile payment app sees international growth
Mobeewave gains traction in countries with corruption, tax evasion problems
In Canada, the growth of electronic payments has largely been driven by convenience.
But that’s not the case everywhere.
In many countries, governments are trying to discourage people from using cash in an effort to make corruption and tax evasion more difficult.
Last November, for example, India removed 500- and 1,000-rupee notes (worth around $10 and $20) from circulation.
Greece has gone even further, implementing cash-withdrawal limits and offering an income-tax deduction to people who spend a certain percentage of their income electronically.
For one Montreal company, that’s an opportunity.
Mobeewave makes a software product that allows ordinary smartphones to accept contactless payments.
The idea is that instead of tapping a credit or debit card on a specialized payment terminal, purchasers tap their card on a phone running an app that uses Mobeewave’s technology. Currently, the company’s software works with recent Samsung phones.
“In those markets where government is pushing a lot, the traction we have is super fantastic,” said Maxime de Nanclas, the company’s co-founder and COO. “They need a digital solution and if you go the route with terminals and bulky things, it’s going to take years.”
The app-based approach also takes advantage of the fact that in many countries where governments are pushing digital payments, banks have less penetration.
“In those regions, what we see is nobody has a bank account, but everybody has a phone,” said Benjamin du Haÿs, the company’s cofounder and CEO.
Currently, 90 per cent of Mobeewave’s business comes from outside Canada. Each one, though, requires a different approach.
“Payment is very, very regionalized,” de Nanclas said.
In Canada, where the growth of electronic payments has been gradual and largely driven by banks, much of the infrastructure, like payment terminals, is already in place, leaving less room for a new entrant.
Here, Mobeewave has focused on charities and events.
Through a partnership with another Montreal-based startup, Connect&Go, Mobeewave’s software has been used to help collect payments for food, drinks and merchandise at local events like C2 Montréal and the Montreal International Startup Festival, as well as international events like South by Southwest in Austin, Texas.
“It’s more about user experience than replacing payment here,” de Nanclas said. “I don’t want to carry $100, $200 in my pocket for a concert.”
At some of these events, “smart” wristbands or badges can be connected to a credit card and then used to make payments.
For events, the ability to use phones, rather than terminals, simplifies setup, du Haÿs said.
“This infrastructure is way easier to deploy, move, scale up or scale down,” he said.
For charities, the ability to accept cards at fundraisers can increase donations and reduce the risk of fraud that comes with collecting large amounts of cash, de Nanclas said.
Mobeewave operates largely behind the scenes. In fact, people accepting payments with its software might never even know they ’re using it. Rather than trying to build an international consumer brand, the company’s growth strategy is to sell its technology to banks, telecoms and other companies.