A US e-commerce company targeting startups has entered Australia with aims to beat the likes of PayPal and major banks.
Braintree launched its payment platform in Australia earlier this week. The service lets merchants accept payments online or through a mobile device, but not in-store payments. The platform handles more than 130 currencies and provides PCI compliance. The US company is now in 30 countries and clients include Rovio, Airbnb, LivingSocial and 99designs.
The company has entered Australia because it's a "fast-growing e-commerce market" with many "great tech companies", and because mobile penetration is high, Braintree CEO Bill Ready told Computerworld Australia.
Also, Braintree saw a gap in the market serving startup companies, Ready said. "It's a wasteland in terms of payment services, particularly for startups."
"PayPal really had been the only choice for startups" besides the large banks, Ready said. But the banks aren't "really geared toward startups," he said.
"We want to make it simpler and cheaper," Ready said. Braintree avoids "fine print" and "hidden fees" present in rivals' offerings, he said. However, Ready acknowledged that regulations in Australia will partially control how low Braintree can price its service.
Unlike PayPal, Braintree gives merchants full control over the checkout experience and does not force them to forward customers to a separate payment website, even though it's Braintree and not the merchant handling credit card information, Ready said. "You don't see someone else's brand in your checkout."
PayPal recently announced a move into in-store payments, but Ready said Braintree is 100 per cent e-commerce and plans to stay that way.
"There are a lot of players chasing in-store and [who] think about mobile payments as using a phone in a store to tap to pay," he said. "However, I don't think there's really a major pain point in the store today. You can create new experiences, but new experiences get adopted slowly.
"Solutions to pain points get adopted very quickly and the place where we see a massive pain point" is e-commerce shopping on a mobile device, he said. People are much more likely to abandon an online purchase on a mobile device than on a desktop or notebook computer because the checkout experience is not optimised for mobile, he said.
Braintree has interest in the mobile digital wallet space, acquiring Venmo in August for $US26.2 million. Venmo is a digital wallet that lets users store all of their credit cards.
However, unlike companies such as Google that is looking to enable in-store purchases with mobile wallets, "we are focusing our efforts on e-commerce," Ready said.
Ready said the winner of the digital wallet wars will be the company who offers the best e-commerce experience over the next couple of years. "If you win there, you then can use that to create experiences in the store."
Ready cited what Apple did for mobile application development as a role model for Braintree's payments business.
"You could build mobile apps in 2003, 2004, but not a lot of people did" because it required technical knowledge of devices and wireless networks, Ready said. "Apple made it so you could build a mobile app and not have to know anything about cellular signal or the hardware of the mobile devices. The result of that was an explosion of mobile innovation... We want to do that for payments."
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