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With Internet transactions on the rise, Jumio looks to curb credit card fraud for online payments
Just a day after PayPal announced its blockbuster success with mobile and Web payments that have increased more than five-fold in a single year, more payment services are looking to get a bigger chunk of this growing market.
The Web payment service Jumio is welcoming 2012 with an additional $25.5 million, according to an SEC filing Wednesday. This latest round of equity is on top of the $6.5 million it raised in March of last year from Facebook co-founder Eduardo Saverin and other investors.
It has not yet been disclosed who participated in this round of funding but details are expected during the Customer Experience Show in Las Vegas this week.
The two-year-old startup’s has been focussing its efforts on a new way to pay in the digital world -- Netswiping. Rather than physically entering credit card numbers and expiration dates, Jumio's Netswipe calls for the user to hold the credit card up to the camera for a digital reader to log in the information.
Jumio has been extensively testing its digital payments service in private beta for the last year and considers this option to be a greater security and ease for customers and retailers since the card has to be present and information is recorded accurately.
This is an interesting and different evolution on the use of credit card transactions, which have been in general circulation since the early 1960s but only started seeing a digital change when PayPal entered the scene in 1998.
With online retail transactions expected to reach $279 billion by 2015, Jumio is raising funding to be a legitimate alternative option in Web retail payments.
Jumio has three main products for online merchants: Netswipe Start, Netswipe Scanning and Netswipe Processing.
Other companies in the field of scanning credit cards includes Card.io and AisleBuyer.
Jumio also hopes to find strength in offering its functionality to third-party software so that others can incorporate credit card scanning in their service.
Jumio has also claimed that its service doesn't have to be seen as a direct competition with PayPal for retailers that already use the service since this can be added as an alternative method to enter payment rather than the mode of transaction -- in other words, it can be a security measure or convenience option.
Co-founder of Jumio, Daniel Mattes, is a serial entrepreneur that sold his latest company, Jajah, to Telefonica for $207 million.
With credit card fraud becoming a larger issue each year, $139 billion in fraud loses were claimed in 2010 by retail merchants, Jumio make have a carved out space in the eCommerce world, if it can prove the added value and fraud curbing to retailers.
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