A Silicon Valley startup is taking a fresh swipe at innovating and streamlining the mobile payments business in the more than $4.5 trillion US retail market by announcing a credit card that may change both how you pay and what you carry in your wallet.
On Tuesday, Qvivr unveiled its new SWYP card, which aims to be the one card that rules them all by electronically storing data from up to 25 different credit, debit, store, gift, prepaid, or rewards cards, allowing you to switch freely between them.
SWYP is not trying to upset the Apple Pay cart or to get retailers to change point of sales (POS) terminals. In fact, Qvivr actually wants consumers to keep paying with the swipe and sign card method they have become accustomed to for decades, as long as it's done with the SWYP card every time.
“We are a bridge between the high-velocity mobile payment innovations and legacy infrastructure,” Qvivr Founder and CEO Ashutosh Dhodapkar told FoxNews.com. “(The SWYP card) connects with a mobile phone with Bluetooth LE and interacts with POS terminals with legacy interfaces. It generates the magnetic strip that’s on every card you have and does it dynamically. It shows you which card you’re using, the last four digits and the strip syncs up with your card.”
Here’s how it works: first you sign up online and your identity is verified using a third party service. When the metallic credit card-sized device arrives, you download the free app (for recent iOS and Android phones) and once again verify your identity. This ensures that you did indeed order the card. You cannot share credit cards -- even with a spouse -- and only the card holder can register a card with SWYP.
The critical step is creating a four-digit PIN that grants access to the app and is required each time you want to pay. The card includes a dongle, similar to Square’s, with which you swipe your own credit cards. The numbers then appear on SWYP’s small display screen.
Qvivr ensures that SWYP has bank-grade encryption and stores your data on a chip locally not in the cloud. The smart card is safely tethered to your mobile device.
“If you lose the card it locks itself up,” Dhodapkar explained. “It maintains a secure leash with your phone. If the leash is broken because the card went six feet out of range from the phone, it locks up and you have to put in a pin to use it again.”
The company says there is a restaurant mode that locks your card so a waiter cannot make a card switch once it’s out of sight. Additionally, you can use a setting for shopping without your device. Consumers can control the device like they would an old iPod, locking it by pressing down on a few buttons.
If you leave your card behind, there’s also a phone app that tells you that it lost contact with SWYP. The card will not work again without the PIN.What if someone were to, well, swipe your card?
“If it loses touch with your smartphone for a period of time, which is configurable, it will erase itself,” Dhodapkar said.
Right now, there are no plans for the card to work outside the U.S. You can leave it behind on trips abroad and it will erase itself and then resync with the phone upon your return.
While the company will start taking orders today for SWYP at a 50 percent discount, the cards are not slated to reach consumers until the fall.
Qvivr is making SWYP “in and around” Silicon Valley with a domestically sourced alloy. The company aims for a durable product with a two-year battery life that is longer than those announced by rivals.
Ross Rubin, principal analyst with Reticle Research, said these products might be useful but will nevertheless target a narrow audience.
Rubin suggested that the biggest barrier to mainstream success is the price. He said that these devices convey "the value of convenience" message of slimmer wallets by consolidating all of those bulky cards into one. However, the prices for these devices range from $99 for SWYP at full price and Coin for pre-order and over $150 for Plastc pre-orders.
“If a credit card or number of credit cards are working for a consumer, you’re paying to pay (by using these digital credit cards). It’s just a consolidation of functionality you have today," Rubin added.
Rachel Rothman, technical and engineering director for Good Housekeeping, is a little more enthusiastic about the cards.
“There are several elements that make these single card solutions even more secure than their basic counterparts," Rothman said. "And beyond the convenience and safety these devices offer, they are also smarter, making it possible to track your habits more easily or provide you with contextually relevant information."
The predictive analytics component Rothman cites is one feature Qvivr hopes will make SWYP widely used.
“The card learns from your shopping behavior,” Dhodapkar said. “It may know you use your Visa card to buy coffee, so after a few days it becomes your Visa card (automatically) in the morning. It doesn’t look into your personal life, it just knows you use this card every morning at this time.”
The companion app also stores receipts, business cards, and other notes that usually stuff billfolds.
The Qvivr CEO added that once more retailers deploy beacon technology, SWYP will be able to recognize when a consumer is in a particular store and provide reminders that there are stored loyalty or gift cards that can be put to good use.
Dhodapkar said that SWYP will eventually be upgraded with near field communication (NFC) and other technologies as they become more prevalent at retail locations.
Rubin said that this will be necessary for this kind of product to stay relevant.
“The biggest barrier down the road is whether (SWYP) offers sufficient differentiation or whether mobile commerce, smartphone initiated commerce will become the dominant way people pay for goods and services in person," Rubin said.