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BI in Action

Michael Dortch

ProPay and MicroSecure: Building More Intelligent Businesses, One Card Swipe at a Time

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So you can't really do business today unless you can accept credit card transactions, right? You certainly can't compete effectively with larger, better-funded competitors if you don't.

But if you're a small business, and especially if you're an individual entrepreneur or a non-profit, being able to accept credit card transactions via the traditional merchant banking account is about as much fun as buying an airline ticket these days. In addition to per-transaction processing fees, there are account set-up and recurring fees, statement fees, so-called "gateway" fees, and burdensome monthly minimums and contractual commitments. Oh, and that does not include lease or purchase fees for the actual card-reading terminal, nor does it include e-mail, Internet/Web or telephone processing, which are usually not available at any price.

Not a great situation, for merchants or their customers. It's all of the above that often leads to two-tiered pricing for cash vs. credit cards, or merchants or venues unable to take credit cards at al.

I recently had an incredibly enjoyable lunchtime discussion with a couple of the executives behind ProPay. When online auction giant eBay announced in August 2008 plans to accept electronic payments only, three methods were highlighted - credit cards (via sellers' own merchant accounts), PayPal (which eBay owns), and ProPay.

ProPay enables merchants, on eBay and elsewhere, to accept and process credit card transactions, by telephone, online, or via e-mail billing and invoices. No set-up, monthly, gateway, or equipment fees. Fixed per-transaction fees, lower than those charged most merchant account users. And none of those pesky, exclusionary volume minimums, which means you can make ProPay work even if you're selling your self-published magnum opus at a book-signing party in your dorm room.

It gets better. ProPay also offers MicroSecure, a service that works with a nifty, battery/USB-powered card reader. It encrypts and captures enough information to allow you to process and reconcile transactions, uploading that information to ProPay's MicroSecure servers when reconnected to the Internet. All transactions are processed through the merchant's ProPay account, and all sensitive information is either not captured at all, or encrypted in ways that makes it useless to anyone but the authorized user and ProPay. And the reader retails for $150, and has one light and one button. So it's easier, faster, and more accurate than entering transaction information manually on a keyboard or by telephone. And you can use it anywhere, even where you don't have any connectivity at all.

But these aren't the only reasons I'm excited about what the ProPay team is doing. ProPay and MicroSecure users can also generate pretty useful reports from their transaction data, on demand via a secure Web site. These are useful immediately, but currently pretty basic. Over time, though, I'm convinced ProPay and MicroSecure users will push the solution developers to enable generation of more comprehensive and customizable reports. Which means users of these simple and economical solutions will have access to increasing amounts of transaction-related intelligence they can use to refine business processes and gain new insights into their customers.

Eventually, there may even be online communities of ProPay and MicroSecure users, exchanging ideas, report templates, experiences and best practices with one another and with developers of the solutions themselves. In the meantime, though, there's enough financial incentive to get almost anyone selling almost anything almost anywhere to check out ProPay and MicroSecure. It's never too early to make accepting credit cards easier and cheaper, or to start accumulating that transaction-driven intelligence.

1 Comment

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Thanks for the post, Michael! I like your thinking. :) You said exactly what we are trying to achieve. We want to make accepting credit card payments easy for everyone. And we are so excited now that our merchant account is integrated into eBay's checkout and we are able to offer our services to a new group of people. Soon we will be offering our accounts to more eBay sellers. Keep your eyes open for that announcement. Thanks, again!

Brandon Crotts
Senior Account Manager
ProPay

Globalization, shrinking business cycles, and increasing competitive pressures are placing demands on business managers to make faster and better decisions. Managers require both real-time visibility into their business operations and sophisticated analytical tools to help them navigate the increasingly fast paced and complex business environment.

Michael Dortch

Michael Dortch is a veteran information entrepreneur and information technology (IT) industry analyst, consultant, speaker, writer, evangelist and provocateur. He has been striving to empower buyers, sellers and users of IT solutions since 1979. Seriously! ;-)

Joe McKendrick

Joe McKendrick is an author and independent analyst who tracks the impact of information technology on management and markets. View more

Madan Sheina

Madan Sheina is principal analyst within Ovum's Software Applications group and is based in Northern California.

Madan has fifteen years' experience working in the IT industry both as an analyst and a journalist. His research covers a range of information management technologies, with a sharp focus on business intelligence, knowledge management and data integration software.

Madan is well respected in the IT industry for his clear, incisive and no-nonsense analysis style. He has advised leading ISVs on market positioning and product development strategy, IT users on product evaluation and selection, and the financial investment community on technology trends. View more

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