What If Obopay Cannot Provide An API?

In my previous post Obopay For Businesses I talk about why online merchants need an API to interface with Obopay. In Why Micro-Retailers Need Mobile Payment Systems I also talk about why I believe mobile payment systems are going to flourish on a global scale.

My question now is what if I cannot get the help from Obopay that I seek? Will I turn to another mobile payment system? Well, I am fond of Obopay. I like their website. I have seen a video interview of CEO Carol Realini and she is very likeable. It seems they have a very noble motivation for providing this service, to reach the unbanked and enable them to participate in the global online economy. Whatever reason for not being able to help me, I do not think they willfully want to burst my bubble. They may be too busy or focused on another aspect on which they forecast the most growth.

Anyway, if I stuck with this provider for mobile payments, what could I do to automate the payment process so that I would not need to manually login to Obopay or manually send out text messages? The answer is a GSM modem attached to my server.

A GSM modem uses a SIM card and a real cellular service provider tied to the SIM card. It can function like a normal cellphone but in addition can be automated, since it is hooked up to a server running custom software. In my case I am interested in automating the text messaging to and from Obopay.

So here is the scenario. A buyer sends an Obopay payment to the cellphone number associated with my GSM modem. Obopay sends a notice (in the form of a text message) of the payment to my GSM modem. My GSM modem forwards this information to my custom software for recording and order fulfillment.

When a buyer receives the goods, the buyer notifies my system to release the funds to the seller. My custom software then uses the GSM modem to send an Obopay pament (in the form of a text message) to the seller. This completes the loop from buyer to seller.

Now my problem is finding the right GSM modem and getting someone to program the custom software. The other problem I might face is ascertaining Obopay will allow this commercial use of their system. I am confident they would because I would be promoting the use of their system. I would publicly promote Obopay on my website as a way to build user trust in my preferred payment system.

Why Micro-Retailers Need Mobile Payment Systems

A micro-retailer is an individual who intends to sell goods directly to consumers with few or no middlemen. A typical micro-retailer uses a third party website to host the catalog of his goods, such as eBay, Etsy, CafePress, Zazzle, etc. Many typical micro-retailers are based in low-income countries where the actual manufacturing of the goods happens. These micro-retailers therefore have access to many products at wholesale prices. Some of them even have the skills and materials to produce the products themselves. Fast Company wrote an excellent story about micro-retailers.

It is interesting to note many of these countries have poor banking systems and many people do not have bank accounts. So this begs the question, how can more individuals in these countries participate in micro-retailing when they do not have an account from which to deposit or withdraw money?

Enter modern mobile payment systems, such as MoneyExchange and Obopay, among many new ones popping up all the time. They offer services by which any seller or buyer can bypass the need for having a bank account. Here is what I understand about them.

An individual creates an online account at one of these services. Funds can be deposited to this account through normal means such as money transfers from banks, credit cards, etc. An individual without a bank account or credit card would pay for an ATM card at a local convenience store with cash. The ATM card is linked to this individual’s online account. Subsequently, the individual can deposit more money into the same ATM card. Money withdrawals happen at the ATM machines.

So the online account and the ATM card work hand-in-hand. When someone deposits or withdraws money to the online account, the same is reflected on the ATM card, and vice-versa.

Real transactions happen when one online account holder transfers money to another online account holder. In these mobile payment systems, these transactions are initiated on a mobile phone, typically via text messaging.

So why do micro-retailers need mobile payment systems? Because they typically live in countries with no banking systems. These are the micro-retailers who have been untapped. They have access to raw materials and manufactured goods at or below wholesale prices. I would love to buy more goods from these people because they could save me money. I don’t want to pay the middlemen any more than I need to.

The next question is: how does one tie their online catalogs with these new mobile payment systems? An online shopper would see the option to pay by mobile, during the checkout process. Perhaps at that point the shopper would be given a unique code and total amount to enter into the text messaging going to the payment system. The system would immediately respond with a confirmation payment code to enter into the website to complete the checkout process.

Do today’s mobile payment systems support this kind of interaction? I hope they do very soon because I have an immediate need for this to occur. I truly believe mobile payment systems are going to be popular on a global scale, especially because they bypass the limitations of today’s banking systems. I welcome your remarks on this very much.