A Silicon Valley ecommerce start up plans to introduce a free online wallet service that can run on remote servers rather than desktops, after having closed its first $5 million round of funding.
Transactor Network's service enables consumers to securely store billing and shipping information on a remote server. Users bookmark the wallet in their browsers and make purchases at participating Web sites by simply entering a login code and password.
The first phase of the service, which will be launched in the first quarter of this year, is aimed at merchants and financial institutions. It is expected to appeal to merchants because it is free and requires no integration. They simply add a link to their site, and refer shoppers to the online wallet, which is sponsored by financial institutions, when they are ready to buy.
Rob Martinez, Transactor Networks? president and chief executive, explained that, if customers buy a digital camera, they will receive emailed information about related offerings because the firm plans to sell its product list to advertisers.
"It's really the basis for an ongoing customer relationship," he said.
Transact also intends to provide merchants and financial institutions with a range of services, including automated product registration and customer service to enables them to initiate, automate and grow their customer relationships over time.
In future, it hopes to simplify customer service and make it easier for consumers to find their preferred merchandise.
A Zona Research study said: "Transactor's challenge will clearly be signing up the requisite number of merchants and financial institutions to create a critical mass, while convincing consumers that such a service makes more sense than simply paying with a credit card."
But Vernon Keenan, an analyst at KeenanVision, claimed that Transactor's server based wallet had two advantages. First, it means users can avoid installing plug ins, and second, it becomes easier to store the user information that Transactor's hopes will become one of its main revenue streams.
But Transactor is also aware of consumer concerns about security and emphasises that its 128bit SSL encryption technology is used by banks providing services over the Internet. It likewise attests that its chief scientist is cryptologist, Bruce Scheiner, whose Blowfish algorithm remains unbroken after two years of cryptanalysis.
But to further overcome such concerns, the firm also intends to partner with branded financial institutions such as Citibank, which, it believes, consumers already trust with their personal information.
Transactor's online wallet service works under Windows, Macintosh and Unix and supports Internet based devices such as Palmpilots and Windows CE boxes, point of sale terminals and banks? automatic teller machines.
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