First Integrated Mobile Terminal for E-Check Acceptance Coming Soon

An integrated device that would allow plumbers, maid services, pizza-delivery people, and other mobile merchants to perform electronic check conversion as well as accept cards will be commercially available by the end of the first quarter of 2006, according to Commerciant LP, the Houston-based company that makes the terminal. The new device would be the first integrated machine on the market to enable mobile e-checks. Check-accepting mobile merchants are “an untapped market,” says Hubert Vaz-Nayak, senior vice president for sales and marketing at 5-year-old Commerciant, which is adding the e-check capability to its existing MobileScape card-accepting device. “They collect the majority of their payments in checks.” Commerciant won't project potential sales volume for the new device, which is being tested with two unnamed clients, including a trucking concern, says Vaz-Nayak. An important distribution channel, however, will be independent sales organizations. The company figures ISOs are looking for value-added equipment to sell to merchants, in part to counter the free-terminal offers popularized over the past year by larger, better-capitalized competitors. “These guys are competing against free equipment, and they're losing a lot of leasing income,” says Marc Beauchamp, vice president for indirect sales at Commerciant. “They'll get more leasing income out of this.” Vaz-Nayak does say the two companies testing the gear have the potential to account for more than 10,000 units if they decide to adopt it. Like the existing MobileScape device, the new terminal is purpose-built technology, rather than a mobile phone or POS terminal fitted with a card reader. Weighing in at 1.3 pounds, it includes a built-in thermal printer and a 3-inch-by-2-inch touch-screen with stylus. The device, which operates on the Sprint CDMA network, runs on a battery that lasts about 300 transactions between charges and 72 hours on standby. To enable e-check scanning (e-checks are accepted under NACHA's point-of-purchase, or POP, rules), Commerciant added a separate reading head, which allows merchants to swipe checks manually through the same slot used to swipe cards rather than rely on the motorized swipe typical in check scanners. The company has patented the optical-character-recognition technology behind this check-scanning capability, known technically as “uncontrolled velocity scanning.” If cellular coverage is poor or unavailiable, the terminal can store transactions and transmit them later when the merchant moves into an area with a stronger signal. Servers controlled by Commerciant store images of all credit card receipts as well as the digits of MICR lines and signatures from checks in real time for later access by merchants via the Web. The company has certified its technology with more than half a dozen card and e-check processors. Commerciant hasn't set final pricing yet, but estimates the device will run $750 to $800 in volume, or $150 to $200 higher than its card-only mobile terminal, which is in use at about 50 companies, Vaz-Nayak says. Among these clients are airlines, which are finding the device useful to process card payments for goods like meals, which used to be distributed to passengers as part of the price of the ticket but now carry separate charges.