06 February 2016

PayPal co-founder Levchin launches m-commerce firm

27 February 2013  |  6260 views  |  2 Teenagers using Smartphone

PayPal co-founder Max Levchin has launched a mobile money company which aims to make it easier for online shoppers to complete purchases.

On its Web site, Affirm argues that the online checkout experience has not improved for shoppers in more than a decade, meaning merchants are left with countless abandoned carts.

The start-up is promising to help retailers turn more mobile shoppers into buyers through a quick and simple checkout process, requiring just a couple of taps of the customer's handset.

Affirm will use Facebook to authenticate customers at the checkout, Levchin told AllThingsD, before guaranteeing the merchant payment, for which it gets a fee.

Acting as a digital charge card, Affirm then gives the customers 30 days to settle the bill, although it does not charge them for this.

"You will essentially be putting a purchase on a digital tab, and we are going to make it work for us by looking at all available data to determine if you are someone who will pay it back," says Levchin.


Comments: (2)

A Finextra member | 28 February, 2013, 07:00

Is there really a problem with difficult check out and payment procedures i web shops that cause abandoned carts? In many webshops you need to complete the process up to checkout until you see the true price for the goods incl shipping cost and time, payment processing and other neccessary add ons you must have. Many e merchants hide the final price until checkout and customers abandoning the cart may well do so because unattractive final price and not because of clonky  payment routines. When I browse in a physical store it is easy for me to examine the goods and check the price compared to the processes in an e commerce store. Abandoned shopping carts problem may not be solved with new mobile payment applications alone. Instead better prersentation of the web shop complete offering may be required. Physical stores have had decades to fine tune their shopping processes while web shops are newcomers. 

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Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune | 01 March, 2013, 18:42

For reasons I'd highlighted in this Finextra post, shopping cart abandonment is surely a problem in India, UK and many other countries in the ROW that use 2FA for online payments. However, online checkout is highly frictionless on US ecommerce websites with none of them I've come across using 3DS and a couple not even asking for credit card CVV. I'm not sure if simplifying the checkout process any further will really improve "browser to buyer" conversion rate. We'll see...

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