I have lived in Ecuador for 5 years. I love the people, the moderate climate, affordable housing and a lower level of stress compared to my country of origin.
Ecuador is basically a cash society. Yes, you can use credit cards in the big hotels, as well as up-scale restaurants and Super Maxi, but try to use a credit or debit card at a local clothing store or espresso bar and you're out of luck.
Disruptive Tech Startup
I first met the folks at Payphone in Cuenca in November 2015. They Have a very modern office With 25 people connected to CoWorking Center which they sponsor for aspiring Entrepreneurs. I had an in depth discussion With Juan Espinoza, the Managing Director, about his technology, and why I thought now is the right time to introduce a technology to replace "cash transactions".
The Payphone Difference
UNLIKE the "cash solutions" for Apple, Google and Samsung, with Payphone, the vendor does not need an expensive Point Of Sale Terminal, Which requires an NFC (Near Field Communication) chip on the customer's Smartphone. The expense of a POS terminal would eliminate MOST of the potential Businesses in Ecuador and Smartphone users who do not have NFC chips.
The customer simply needs a smartphone or tablet and the Payphone App which you can download free from Apple, Google or Windows App Stores. The customer then registers his credit/debit card with their Payphone App information.
How It Works?
The Vendor simply needs a computer, smartphone or tablet connected to the Internet with a Payphone account. You can see how each transaction works by going to this link or you can go to Payphone's web page here or their Facebook Page
What's In It For Me?
It may sound crass but That is what everyone wants to know. Why should I consider using Payphone? The smart consumer will ask the following questions:
Is it safe technology?
Will it save me time, Which translates to saving money?
Is it easy to use?
For me Payphone will be a quick fix to saving time. Regardless of what life stage you find yourself in, paying utility bills in a short amount of time Makes Sense. Let's use as an example utility bills for Payphone.
In Cuenca, to pay my utilities - water, electricity, phone - I have to travel by bus or cab to a Pay Point. The expectation in Cuenca that is one waits in line to pay utility bills in cash. Sometimes the computer system of the PayPoint is down for hours, wasting time and the cost of a return trip. Payphone now allows me to go on my Smartphone to access the account and pay utilities each month, THUS Eliminating the need and expense of a physical trip.
The Challenge For Payphone
Payphone will be Easily ADOPTED by tech savvy customers. The primary challenge is to attract those potential customers who are older or NOT tech savvy enough to understand or trust this new technology, Especially those Who will question "cloud encryption". Education and ease of use will win over new prospects. Payphone must enroll a critical mass of vendors for this technology to be effective. Lastly, old habits are hard to break; older customers with credit / debit cards may be a hard sell.