Zooz is aiming to improve mobile payments with a single solution service that allows developers to offer PayPal, credit card and carrier billing options in one screen on iOS, Android and — as of today — HTML5 apps.
The Tel Aviv-based startup wants to address what CEO and co-founder Oren Levy sees as a lack of standardization in mobile payment options. With some apps using PayPal, some using credit cards and some redirecting to other apps or mobile websites, Levy believes consumers are often unable to use their payment platform of choice, and are unsure if they can trust mobile apps to safeguard their financial information. Developers, meanwhile, see too many users abandoning purchases partway through the payment process.
By integrating the Zooz SDK into their apps, developers can offer mobile shoppers the choice to pay with PayPal, major credits like Visa, MasterCard and American Express, or direct carrier billing from over 70 different carriers in the U.S. and Europe. This makes it easy for developers to let customers pay how they want, which in turn boosts conversion. One app in the Zooz beta test saw its conversion increase from 30 percent when using PayPal as the only purchase option to 60 percent after offering credit card, carrier billing and PayPal payment options through the service.
Users who pay through the Zooz system never have to register with Zooz or download a separate app in order to make payments, but users can choose to complete a one-time registration process that associates their payment details with their mobile device. Users who choose to do this will see their payment details pre-populate the next time they make a purchase on their registered device in a Zooz-powered app, even if it’s a different app. If a user does choose to register their device, they can also set up a secure four digit passcode to prevent unauthorized purchases. It’s a different approach from rival payment startup Clover, which requires users to download a separate app, but then promises subsequent transactions will be completed in seconds.
“If you look at numbers, every additional step you require from the user reduces the conversion rate of an app,” Levy says. “While some competitors are looking more to process credit card payments, we’re looking to standardize the mobile checkout. Just like you’d go to a website and see the VeriSign seal and know that page is secure, our vision is for you to go onto a mobile app, see the Zooz screen and know it’s secure and you can trust that screen and app with your credit card and PayPal details.”
Zooz offers two tracks to developers who want to use the company’s services to process payments. For independent developers who don’t have merchant accounts with major credit card providers, Zooz will process those payments for them, taking a fee of 2.8 percent, plus 19 cents per transaction. For users who choose to pay via PayPal or carrier billing, Zooz doesn’t charge the developer, instead directing the transactions as part of its greater service. For larger developers with merchant accounts, Zooz acts as a mobile payment gateway, earning affiliate fees for directing transactions.
Zooz’s technology and security features have been in development for just over a year, and recently came out of a four month long closed beta. Although fairly new, Levy tells us about 1100 apps on iOS and Android are already using Zooz to process payments. The company is backed by $1.5 million round of seed funding from Lool ventures, Rhodium, Kima Ventures and other angels.