CheXout Aims to Bridge Mobile Processors to Physical Payments

Restaurant customers will be able to use their mobile phones to both split and pay dinner tabs with an application now being marketed by Boston-based startup CheXout Systems Inc. The company, which has been incorporated for less than a year and has no live installations, is forging integration agreements with vendors of point-of-sale systems for restaurants and hopes to sign clients of those vendors for its product, called CheXplit. The first deal is with Dinerware, a Seattle-based company, according to Brian Foster, chief executive at CheXout. But at the same time the fledgling company could also provide mobile-payments processors entrée into the market for physical-world transactions. Foster says CheXout is working with processors including PayPal Mobile to handle payments on its platform. Transactions could include not only payments to restaurants but also peer-to-peer payments to settle up checks once the splits have been determined. Although CheXout users could rely on any mobile-payment service with which they have an account, integration of the service with CheXout will result in a “much more seamless solution,” Foster says. He adds he has ambitions to expand CheXout into hotels, casinos, and resorts, a move that could considerably widen the pool of available transactions. “For [mobile-payment] solutions, we're giving the ability to access a whole new world of industries,” he says. Users are not required to have any membership or account with CheXout to use the system, but to begin with they will need an Apple iPhone or Blackberry Curve for the service to work best. These are the phones CheXout has tested for optimal performance, Foster says, though he adds more devices will be added later, including handsets running Google Inc.'s Android operating system. CheXout interfaces with the restaurant's operating system, allowing it to display all the details of a table's bill. Using the mobile Internet, diners can bring up the bill on their phones any time during the meal by entering a four-digit number supplied by the waiter. They can split the bill evenly or by items on the bill. CheXout calculates what everyone owes and allows the diners to pay each other and for one of the users to pay the restaurant. “We're going to be integrated with a lot of mobile-payment solutions,” says Foster. “At some point we'll evolve to have our own payment offering.” The company also plans to add a loyalty program that will allow client restaurants to offer rewards when they use the system. Foster refuses to discuss pricing, but says CheXout will charge restaurants licensing and maintenance fees. Diners pay nothing to use CheXout but are responsible for any fees levied by mobile-payments processors and their carriers. “Down the line there's likely to be a premium service to consumers that we'll be selling,” says Foster, without adding details. An entrepreneur with experience in technology behind investments and accounting, Foster says he developed the idea for CheXout a number of years ago out of frustration over having to split restaurant tabs when dining with friends. “I hate splitting checks,” he says. He also sees CheXout as more secure than traditional card payments, where wait staff take the customer's card out sight and return some time later with a receipt to sign. He acknowledges that there are mobile POS terminals that customers can use at the table. “But then you don't get away [from the problem of] counterfeit cards,” he says.