Micropayments

Micropayments open up new sources of online revenue

Colin White, UK CEO of Oxygen8 Communications, explains how the arrival of viable, global micropayments technology has the potential to open up a whole new revenue stream for organisations

Demand for micropayments is increasing fast as social networking and dating sites wake up to the benefits of taking small subscriptions via secure SMS or voice billing services. Adding to this and as part of the Digital Britain report, the Government has announced a £10M investment to work, at least in part, with industry partners to create and trial new models, including micropayments for online content and video on demand.

But with the organisations receiving only 66 pence in every £1 for micropayments due to network charges, compared with 96 pence for credit card transactions, there is a very real danger that the market for micropayments for a range of online goods and services could be severely constrained.

Given the lack of credit card penetration in many countries, including China, and within the younger demographic that still dominates the online customer base, the need for robust and commercially viable micropayments is pressing.

By agreeing to operate on smaller margins, it is likely that the networks could precipitate a massive adoption of micropayments that would generate significant additional revenue. Without that change in policy, the real micropayment opportunity could remain untapped.

Learn more about Micropayments from our Sales Team today.