With alternative payment platforms entering the market, competition in the payments business has intensified.
Groupon is the latest player to enter into the payments business, providing a card swiping device that plugs in directly to an iPod touch or iPhone via the audio jack.
The new Groupon Payments system will go head to head with Square and Paypal, especially as it will offer merchants a cheaper option to process payments. In particular, Groupon is willing to accept lower margins by charging a lower rate than other providers. Furthermore, given Groupon's size, it will be able to get favorable rates from payment networks like Visa and MasterCard.
This is evidence that we are in the midst of a revolution in the payments space, where payment fees are falling and incumbents in the payments ecosystem are having to find new ways to innovate to retain market share.
If you are a thought leader in your organization and have some key insights to share about the future of payments, we would like to invite you to speak at Cards & Payments Asia in 2013. For speaking opportunities, e-mail email@example.com
(Photo Source: AP Photo/Groupon)