Card.io, a new San Francisco-based startup led by two former AdMob employees, Mike Mettler and Josh Bleecher, is introducing a revolutionary idea that could transform mobile commerce: make it easier to pay. But how the company has accomplished this is a feat that will feel more like magic to the everyday mobile user. With card.io, you simply hold your credit card up to the phone. The software then "sees" the card information using the phone's camera and the payment is processed. No typing required!
To get the technology into the hands of those who need it most, card.io is targeting iOS developers at launch, specifically those in the e-commerce, local, ticketing, travel and daily deals space.
Card Scanning is Very Accurate, Says Company
The company has been in existence for only nine months, six of which were spent building card.io's core technology, the computer vision and machine learning algorithms which it uses to read the numbers of a credit card. Unlike several other check-scanning and business card scanning software programs, card.io doesn't use humans to verify the accuracy of scans - everything is programmatic. Of course this means that the scans themselves have to be highly accurate, and Mettler says they are.
However, the company wouldn't provide exact percentages here, only that the "vast majority" of scans should be accurate. But that's where the machine learning aspect comes into play. The more data that's processed, the better the software performs because it learns and improves over time.
Once the credit card information is entered, the developer can then continue to process the payment using their own merchant account as usual. Although card.io will be looking for merchant partners going forward, that's not the service it's offering today. Also of note, all the data card.io handles is secured using 128 bit-SSL and the service never stores card images on the phone or on the company's servers.
Going After E-Commerce, Not Point-of-Sale
Using technology to input the credit card details into a mobile device may seem like a step backwards when positioned alongside other upcoming mobile advances like NFC, a wireless technology that lets you pay for real-world goods with just a tap.
But NFC requires a special chip in handsets, and currently, few phones on the market offer this. It's still years out from mainstream adoption. Meanwhile, everyone has credit cards and these plastic, physical cards won't disappear anytime soon. Most importantly, card.io is not trying to compete with NFC or other innovations at the point-of-sale - it's going after the e-commerce market.
With a new software development kit (SDK) available now, the iOS (iPhone, iPad and iPod Touch) developers accepted into the company's private beta can integrate the technology into their own app. Initially, as noted above, card.io is most interested in developers working in the e-commerce, local, ticketing, travel and daily deals space. It is already working with a few companies here, including MogoTix for event tickets, TaskRabbit for local services and SamaSource for donations.
Card.io received $1 million in seed funding in January, led by former eBay exec Michael Dearing of Harrison Metal. Other investors include Jeff Clavier and Charles Hudson of SoftTech VC, Manu Kumar of K9 Ventures, Alok Bhanot (former VP, Risk Technology at PayPal), and Omar Hamoui (CEO/founder of AdMob).
iOS developers interested in joining the private beta have to plead their case here.