Kiwipay up against US giant PayPal
The majority of New Zealand's small to medium-sized businesses will be using a Nelson-based online payment platform in five years, if the man behind Kiwipay gets his way.
Nelson entrepreneur Galen King is the founder of design company Lucid Design, which is based at the Bridge Street Collective.
The collective is a shared workspace for creative professionals, which Mr King also founded last year.
Kiwipay had its inception as a platform called Lucid Pay in 2005, which was a Lucid Design side project set up to help the clients it designed websites for.
Mr King said United States-based online payment system PayPal wasn't available in New Zealand then and there was no way for small businesses to accept credit card payments online without a "prohibitively expensive" merchant account.
"Our clients needed a way to get payments from their overseas guests, so we built a product for them. I guess sometimes we're scratching our own itch with what we create," he said.
Kiwipay automatically puts funds into business and organisations' bank accounts, with no need for merchant facilities or gateways. It has no monthly fees and a 3.3 per cent commission rate on secure credit card transactions.
Mr King said Lucid Design considered "shutting up shop" with Lucid Pay when PayPal came to New Zealand, but he persevered as he still saw a market for a New Zealand-based service.
Lucid Design re-launched the platform as Kiwipay this year, under a separate company.
Mr King said the board of four directors, formed last year, had a vision for expanding the business, which already had more than 50 clients around the country.
A dozen of those were Nelson-based businesses and organisations, including the Nelson Tasman Chamber of Commerce.
"We're aiming for thousands [of clients]. Our vision is to be a serious player in the payment space," he said.
Mr King said the board was keen to grow Kiwipay using a Nelson-based development team and workforce and hoped to secure its first round of investment through Venture Accelerator Network in the coming months.
He said Kiwipay was also in the throes of creating some mobile plug-in device prototypes, which would allow mobile vendors to take payments through their iPhones.
Nelson Tasman Chamber of Commerce chief executive Dot Kettle said the organisation signed up with Kiwipay last month, because it had noticed an increase in the amount of Nelson-based businesses wanting to pay for subscriptions or events by credit card.
Ms Kettle said they could now do so through the Nelson Tasman Chamber of Commerce website, resulting in an instant payment, where previously the organisation had to invoice them.
"I think it's a great example of innovation in Nelson. It's a New Zealand-based alternative to PayPal, cheaper and easier to track," she said.