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Also in this section: Cheques SEPA and PSD Mass payments and collections Payment cards Mobile phones/Cellphones Online micropayments Future of payment systems |
There are several problems with these so-called micro-payments. The cost of clearing and settling a payment never really falls below 20 cents, which is far too high for a payment of $1 or less. The overhead of registering a subscriber is too costly and, in some ways most important, every purchase requires a mental decision as to whether or not it is worth the price. Subscriptions work in a limited number of cases, but Rupert Murdoch’s dream of making occasional readers pay for access to the content on News Corporation web sites is proving difficult to convert into reality. Aggregating payments over a period of time or until the total value reaches or exceeds a specified amount, as Apple does with the 100 million-plus registered subscribers to its iTunes service providing music, videos, TV programmes and ‘apps’, many of which cost less than $1 each, works well but the user has to be registered, including full payment card details.
Most Euromoney readers visit certain web-sites regularly and would be willing to make a small contribution, depending on how much they use a site. The new Kachingle service enables readers to do this by ‘crowd funding the sites you love’. Kachingle went live on 1 February and has signed up internet sites from groups such as Spiegel International, WGBH/Boston, Salon, AllVoices and the Hearst Corp, as well as many other smaller sites which all carry Kachingle’s widgets, called Medallions, on their sites. Users register at Kachingle and state how much each month they would like to share across their favourite websites, which they select by clicking on the Medallion. The registered Kachinglers’ daily visits to their selected websites are counted by the Medallions for Kachingle to distribute each Kachingler’s monthly payment in proportion to the websites they have selected and visited, as shown in Figure 4.
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Figure 4 – Kachingle crowdfunding service |
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Source: Kachingle |
Cynthia Typaldos, Kachingle’s founder, believes, “Kachingle’s model is much closer to the way the internet works than standard micro-payments, tipping or subscriptions, because it’s easy — users decide just once who they want to pay and the service figures out for them the value they are receiving; the service doesn’t create ‘walled gardens’; the total amount of money is limited; and above all it’s voluntary.” Kachingle’s financial analysis shows that a site with 1 million visitors a month can expect to make at least $6 million a year after six years or so from Kachinglers.
