It’s a fact of life for e-retailers that because consumers cannot run their credit and debit cards through a point-of-sale terminal when they buy something online, the web-only merchant must pay card-not-present rates, which are higher than card-present rates because of greater fraud risk.
Jumio Inc. says its Netswipe payment service can help e-retailers get around that and help them pay the lower card-present rates. When a consumer wants to buy something at an online merchant that uses Jumio, he simply selects the option to pay with a credit card. Netswipe instructs the consumer to hold the front of the payment card to the computer’s webcam, where it is scanned. Then, the consumer is prompted to enter the card verification code from the back of the card by clicking on the appropriate numbers on a keypad displayed on the screen.
“Netswipe is designed to have consumers use the mouse to enter the CVV code rather than the keyboard as a final step of security to acknowledge that the transaction is being completed by a human being,” a Jumio spokesman says. He adds that Netswipe does not store an image of the card or the card numbers. The software is written to detect if the consumer is holding up an actual card or a piece of paper with numbers written on it, he says. The CVV code is the unique three- or four-digit card identification number that appears on the front or back of every credit or debit card.
The software also checks to ensure the card is properly embossed and contains other security features, such as a card brand’s hologram on the front of the card, Jumio says.
The desktop-based system is the first step toward Jumio entering the increasingly competitive mobile payments arena. The company says it will debut a mobile commerce version of the Netswipe system designed for smartphones later this year. It will compete with established player Card.io, which offers a mobile payments service revolving around a smartphone’s camera.
There is no fee for the consumer, but merchants pay a per-scan fee that varies between the merchant type and the country they’re in, the spokesman says. Merchants also may sign up for a Netswipe payment processing account and pay 2.75% per transaction with no set-up or monthly fees, he adds.
“Jumio bridges the gap between security and trust of traditional in-store payments and the availability and convenience of modern-day, online transactions,” the spokesman says.