Mobile based Point Of Sale (POS) service provider Mswipe has bagged its first Series A institutional funding. Led by Matrix Partners, the company had in the past managed to get Angel Funding from multiple prominent personalities & Anand Rathi Financial services. Though the size of the fund infusion has been kept under wraps, the company had earlier declared it was looking for a figure close to US$ 5 Million.
What makes the company & the product unique & viable?
Credit / Debit card accepting terminals are needed in large numbers. Apart from being cost prohibitive to small merchants, these terminals are a completely independent affair & require a constant internet connection to work. Mswipe offers a complete package for just Rs. 2999 (US$ 55) which includes a Mobile Phone, a Card Swiper & a SIM Card. The Swiper works similar to Square or Gropuon’s offering & attaches itself to the mobile phone via the standard 3.5 mm audio jack. Mswipe does charge a fixed monthly subscription charge. We have known companies who offer a per-transaction charge too.
Though the company doesn’t disclose details about the interface, it does reveal that the provided mobile phone comes pre-installed with Mswipe’s application & that all the transactions made via the Swiper are reflected the next day. Additionally, the system apparently works well on a basic phone. Furthermore the firm has an agreement with Prizm Payments and Axis Bank for the service and Boston-based Roam Technologies has provided an exclusive license to Mswipe specifically for its South Asia operations. Collating all this information, we come to the conclusion that the system could be relying on the decades-old SMS route to interface with back-end servers. With the advent of IMPS, the company could additionally look at such techniques too.
The company has cleverly focused on Small merchants & traders who do have the volume & the clientele, but are restricted by hardware. Owing to lack of ready-to-use terminals, such traders are left to deal with cash or cheques. If these systems find their way to Tier II & III cities & towns, the commerce & e-banking scenario could get a significant boost. After all, who wouldn’t want the convenience of not carrying loads of cash. What do you think?
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