With Groupon continuing to struggle with the decline of its daily-deals business, collecting transaction fees might give the company a much-needed revenue boost.
Groupon officially launched a mobile payment-acceptance device it had been testing since July. It now enters a very crowded field with the likes of Square, PayPal, and VeriFone.
From an All Things Digital article:
Mihir Shah, Groupon’s VP of Mobile and Merchant Products, said Groupon is guaranteeing it has the cheapest rates — and will beat a merchant’s current rates if it doesn’t. He said that merchants often don’t even know what they are paying because of complicated rate structures and monthly fees that make it hard to figure out.
Because of that, Groupon is offering three main rate structures:
• Swiped transactions — MasterCard, Visa and Discover (1.8% plus 15 cents) and American Express (3% plus 15 cents)
• Keyed-in transactions — MasterCard, Visa and Discover (2.3% plus 15 cents) and American Express (3.5% plus 15 cents)
• Non-Groupon merchants can also sign up for the service, however, they will be charged slightly more (2.2% plus 15 cents for MasterCard, Visa and Discover)
Groupon claims it is not competing with Square and is targeting its existing client list for the service. But Groupon is guaranteeing cheaper rates than its competitors, which could lead others to do the same as this particular segment of the industry continues to expand.
Click here to read more from All Things Digital.