SAN FRANCISCO--VeriFone, whose countertop card-swipe devices are used to approve 65 percent of the world's retail credit card transactions, is moving that franchise to the Internet.
The company today announced software that promises to help Web merchants and their banks handle credit card purchases securely by linking into existing transaction-processing systems. The company has spent the past several months establishing a name in the electronic commerce market by releasing statements of strategic direction, but today is the first day that it layed out real commercial products.
VeriFone today announced three sets of software to handle Internet credit card transactions:
--vPOS, the point of sale software installed on a retailer's Web server to connect to its merchant bank and the credit card processing system.
--vGate, the Internet gateway that allows a financial institution to accept transactions from merchants without altering its existing computer systems. vGate resides inside the banking institution?s firewall and converts the Internet transactions into formats understood by legacy financial networks.
--vWallet, consumer software to store credit card numbers, digital certificates and other Net payment types. In the future, vWallet will also handle electronic cash and electronic checks and be able to read information stored in upcoming electronic wallets from Netscape Communications and Microsoft.
"Our strategy is to dominate payment systems in virtual space as we have in physical space," said Hatim Tyabji, VeriFone?s chairman, CEO and president, told a group of bankers, merchants, analysts, and reporters today here.
VeriFone's merchant and bank gateway software will eventually implement the Secure Electronic Transactions (SET) protocol, which is being finalized by its chief sponsors, bank card associations Visa International, and Mastercard International. A final specification for SET has been published and is now in the final comment stage.
But the consumer vWallet software initially will rely on the SSL (Secure Socket Layer) security protocol developed by Netscape, not SET, since the most popular Web browsers already support SSL. The company has not yet decided when it will ship vWallet, but the banks will eventually be provided with the software to distribute to their customers.
VeriFone also plans to use merchant banks as its primary channel to distribute its vPOS merchant software to retailers but will also bundle vPOS with Web server software. vPOS will be available by October for $1,500 for a single merchant license. vGate is also due to ship by October as a software license to banks.
VeriFone?s initial banking customers will include Wells Fargo, Royal Bank of Canada, Novus Services, and Hitechniaga Group. Universal Savings is also looking into VeriFone?s strategy.
VeriFone?s new strategy also attracted a number of endorsements from the software industry, including Open Market, Oracle, O?Reilly & Associates, and VeriSign. RSA Data Security, whose encryption technology is used by VeriFone, also endorsed the new strategy, as does AT&T EasyCommerce Services, Bital, and GTE.