Making India mobile payment ready: The Mswipe story
Have you ever turned your pockets inside out to pay the local grocer and wished he could let you pay by card? Or found an exotic curio you fell in love with in a quaint little shop but had no cash at hand or ATM in sight? Well, almost all of us have been in similar situations.
Point of sale (POS) – that is, the point at which a customer makes a payment to a merchant in exchange for goods or services – is a critical pain-point with small and mid-sized merchants in India. Entrepreneur Manish Patel came face-to-face with it when he started a few wine and beer retail stores in Mumbai in January 2009 and wanted to accept card payments from customers. His pursuit of a cost-effective POS solution led him to start up Mswipe Technologies Private Limited.
Mswipe launched the first mobile POS solution in India in 2012 with a card reader which can be attached to any mobile phone’s audio input jack. With Mswipe’s mobile swiper, merchants can make their mobile phones, even the ‘unsmart’ feature phones, accept card payments. The device can be activated in three simple steps: Plug it into the audio jack of the phone, launch the application and swipe. The entire solution was developed in-house. This included an application on multiple mobile platforms, payment gateway and encrypted card reader.
“We believe there is a large market opportunity with small merchants craving mobile payment terminals and adopting front-end POS technology. Mswipe will provide seamless and affordable mobile POS solutions directly to merchants in 200 Indian cities as well as work with partners like insurance agents, home delivery and so on,” Manish said.
From salon to AC repair man
Mswipe mobile swipers have already made POS simpler for about 6,000 merchants across India and 1,000 merchants in Sri Lanka. For instance, one of Mswipe’s early customers ran a salon in Mumbai. Most of their clients wanted service at home, and many a time, wouldn’t have the cash at hand to pay. “They had to waste a lot of time to collect what is due. Mswipe completely solved that problem for them,” Manish recalls. Just a fortnight ago, the AC repairman at Manish’s office came up to him and asked for an Mswipe. “He was delighted by how it simplified payments for him when he visited homes and offices for repair jobs.”
And it isn’t just the small guys who find Mswipe useful. Several big merchants like Reliance Life Insurance, ICICI Prudential and Eureka Forbes use them too.
The device is easy to use, and works with most phones. To complete a transaction, merchants should fill in the amount, swipe the customer’s card, enter the cardholder’s mobile number and email address, get his/her signature on the screen and send a receipt via sms or email. The money will be credited to the merchant’s account.
From Mswipe to Wisepad
In December 2013, the team launched the first EMV compliant mobile POS solution, Wisepad. It is bluetooth-enabled and requires no physical connection to the phone. It lets merchants accept credit and debit cards with the same security and speed as conventional POS terminals at an affordable price and competitive card interchange fees. Besides enabling cash transactions, it also allows the merchant to cancel unsettled transactions, review the last 30 transactions and check the day’s summary.
The Mumbai-based startup has just raised a second institutional round of funding. The lead funder is Matrix Partners India, followed by Axis Bank and DSG Consumer Partners. Mswipe intends to use the latest funding to expand its distribution footprint. “Mswipe will partner with leading banks to deploy these terminals at small and mid-sized merchants across the country and continue innovating on front-end POS technology to help make businesses more effective,” the funding announcement said.
Announcing the current round of funding, Managing Director, Matrix India, Rishi Navani said: “Mswipe has made significant progress since our seed investment in becoming the category defining mobile POS solutions company.” Currently, Mswipe has over 100 employees and a pan-India direct sales agent network to provide after sales support to customers.
This new round of funding will enable them to spread out in more tier 2 and tier 3 cities across India.