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I had a great idea for starting a little business last year. I also had the skills, the savvy and a service which -- although wouldn't make me a millionaire -- had the potential to double my current income. I searched for possible competition, but nothing seemed to be a real threat. I had found a niche, and had the ability to fill it.

The only snag was that I needed an online payment system, one that wouldn't charge me more for using their service than I earned, and one that people would have enough trust in to use without a second thought. As banks, "total service solution providers," consultants and vendors' quotations made any hope of my plans getting off the ground heavier with each visit, I finally gave up on the idea.

AsiaPay, originally an Asian PayPal wannabe, also spotted a niche created by other budding entrepreneurs like me. They set up a digital payment service that is convenient and secure, and affordable enough to be used by everyone from a small corner florist to a virtual storeowner operating out of their bedroom.

Joseph Chan, CEO of AsiaPay, explains that his company provides an affordable option to businesses that need to conduct transactions, such as buying cinema tickets, flowers, music, etc, either at high-street stores or online.

"The difference with us and the banks is that banks can offer a similar service, but you have to follow their systems, which can be quite rigid with relatively limited choices of the types of cards accepted and the inflexibility to customize its functions," he explained. "Banks are also somewhat more conservative about handling SMEs' accounts because they may be concerned about risks, instability, relatively lower sales volumes or one reason or another. Moreover, they seldom provide technical support, so SMEs are basically on their own."

Because the very nature of online shopping gives people the ability to buy products or services from around the world, transactions can take place in a multitude of currencies, using various credit or debit cards. Moreover, the different types of payment schemes that people prefer using can be as diverse as their ethnicities.

Mr Chan says AsiaPay's PayDollar system can accept various currencies and cards, and with multi-lingual payment interfaces. "For example, a cosmetics outlet which uses AsiaPay wanted to be able to process purchases with as many as five different types of credit/debit cards in three currencies for local and international markets, and we were able to do that for them," he explained. "Online payment systems such as PayPal can also be accepted with our system, so merchants don't need to set up one system for credit cards then set up another system for PayPal or whatever. In a nutshell, merchants had to have different platforms for different types of payment. Now they are all under one system which saves set-up costs and running overheads."

The basic set-up fee for PayDollar starts at HK$2,000, followed by a monthly service fee of between HK$240 to HK$330, plus a transaction processing fee of 3.5% to 4.0%, which includes credit card companies' cut.

Security
Depending on who you talk to, online security issues are either grossly over exaggerated or a major issue. Mr Chan said AsiaPay has to adhere to Visa and Mastercard's stringent security measures, so all the checks and locks are securely in place to prevent unauthorized access to encrypted transaction data. Three Hong Kong banks and one bank in Macau are also using the service "which demonstrates our secure environment is meeting the global market standard," he said.

Mr Chan is no stranger to bank security, having worked for a number of banks himself before deciding to follow his passion to deploy a financial technology system in 2000. During the heady days of the dot-com party, the original plan was to profit from the anticipated boom in online auctions and sales sites. However, the uptake was slower than expected, so the scope of services was expanded to include full payment services across Asia for online and wireless transactions.

Having ridden out the miserable start to the new millennium, the SARS outbreak ironically was good for his business as more people looked to minimize their contact with others by selling and buying online.

No more queues
Another solution he is working on is mobile payment stations. With a handheld credit card reader, salesgirls in department stores, for example, can connect wirelessly to the credit card clearing system to make the sale. Although not a new technology, the cost of the mobile credit card readers used to be so expensive that they were never really feasible. Now that the prices have tumbled, they are a practical alternative to the stationary cash register.

In Hong Kong, where shop rentals are often hundreds of dollars per square foot, space freed up from cash register islands translates into more space to display merchandise and thus more sales.

"We don't see this type of service springing up in stores overnight, because merchants are used to cash registers and it is not a case of life or death for them if they don't implement it," Mr Chan said. "But if they consider the manpower they can save and also the extra floor space they can free up, they might consider it as a must-have service if rents keep rising."

Company: AsiaPay
Established: 2000
Year joined HKGCC: 2005
Web site: www.asiapay.com
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