AUSTIN, Texas – It’s been a busy month for startups trying to gain visibility in the mobile payments space. They barely had time to catch their breath after Mobile World Congress before it was time to head to San Jose for this week’s Mobile Payments Conference. That show ends today, but today is also the start of Austin’s South by Southwest Interactive Festival. “Increased mobile functionality” is one of the show’s top three trends, according to event organizers, and mobile payments are a specific focus.
Subtledata is an Austin startup looking to square off with Square in the mobile payments processing space. There is absolutely nothing subtle about Subtledata founder Rich Bagdonas. He’s walking around the Austin Convention Center with a giant interactive payment kiosk strapped to his back, and by 9:30 on the first morning of the show he says he’s already been “tapped” by a number of potential investors. Bagdonas says he’s excited but not surprised that a large technology company may want to buy his company. “Square has proven the concept,” he says, “but we have ruggedized it for retailers.” Subtledata’s kiosk is as large as a tablet, and can be wall mounted. There are no removable parts, and all credit card data is encrypted within the device. Bagdonas says Subtledata will be announcing contracts with three Fortune 500 clients soon.
But big companies are realizing that mobile processing of credit cards is just one part of the mobile payments picture. Gartner analyst Avivah Litan says the biggest mobile payments innovation the past year was “the fact that retailers and like alternative payments companies like Google Wallet are trying to create thier own ecosystem and not necessarily have the banks drive it.” In many parts of the world, millions of people have mobile phones but no bank accounts or credit cards. Even in the US, moving money from one mobile phone to another is emerging as the most efficient way to transfer funds. RegaloCard is an American company that helps people in the US send money to friends and relatives in other countries who may not have bank accounts. And of course the major US carriers are busy experimenting with ways to let customers buy more than wireless service with their mobile phones. AT&T, Verizon, Sprint, and T-Mobile are all experimenting with direct carrier billing.
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