Posted on 11/27/2011 5:15:18 PM PST by decimon
There's a tiny 12-person startup churning out of Des Moines, Iowa that most people have never heard of.
Dwolla was founded by 28-year-old Ben Milne, and it's an innovative new way of thinking about online payments that sidesteps credit cards completely.
Milne has no finance background, yet his little operation is moving between $30 and $50 million per month, or about $350 million per year.
We interviewed Milne about how he is building a credit card killer and Square rival from the middle of the nation where VCs and press are scarce.
I'm told you're pissing off credit card companies. How are you doing that?
Ultimately we're trying to build the next Visa, not the next PayPal. We're building a human network based on how we think the future of payments will work. The current model needs to be blown up.
(Excerpt) Read more at sfgate.com ...
Mark of the beast?
Could be
Why would this be more beastly than anything else done with money?
Interesting to be sure...25 cent transaction fees...hmmm
I like the cost, but I don’t like anybody having direct access to my account.
I barely trust the banks to have access to my accounts.
Bump for later replies. I am interested in this.
More like mark of the entrepreneur.
When’s a good time to short eBay if Paypal is going to get creamed?
Because it links money to people directly, rather than allowing it to remain separate.
It's an infrastructure refinement that takes a big step towards pure electronic money with innate human audit coding.
In other words, kiss anonymous spending goodbye in even the smallest or most informal transactions.
I can’t tell just how this works, but...
It doesn’t look like anyone has direct access to your bank account. Unless, I guess, you set up automatic payments.
One thing you might do is set up two checking accounts, one for regular payments and the other for the one-off payments you less trust. Keep a minimal balance in the second account.
More and more, I’m trending towards using cold, hard cash for purchases.
You already have that, FRiend. It's that nine digit number you use to get a job, open any financial account and obtain other documents to drive and travel.
It sounds similar to the debit system in Canada.
Basically, the merchant contacts the bank electronically, who checks my account and approves the purchase or declines it.
It doesn’t sound revolutionary to me from the description of the article.
I can't remember the last time I had more than $200 in cash on me. And that's only when I travel on business. 95% of my transactions are credit card and online payments.
Because it links money to people directly, rather than allowing it to remain separate. It's an infrastructure refinement that takes a big step towards pure electronic money with innate human audit coding.
In other words, kiss anonymous spending goodbye in even the smallest or most informal transactions.
I don't think this is being more linked to money than what we have now. And I'm not going to pay 25 cents to make a 5 dollar purchase when I can just hand someone a fiver.
Mark of the beast?
Anyone who reads the article (especially if you do much Paypal, or are a merchant, or want to receive payments, or make wire transfers will realize that this should succeed, and may be a godsend.)
When credit card fees double the markup on a gold coin purchase, something else is needed (especially when banks want $20 for a wire transfer).
And if you think $0.25 is too much to move your money (or receive it), then you must hate Paypal, which gets 2.9% PLUS $0.30.
If its like paypal then they can freeze your account with that access. Freeze the account and the funds in it.
Personally, I like my credit cards. Of course I pay them off every month...
“In other words, kiss anonymous spending goodbye in even the smallest or most informal transactions. “
Unless you use cash you’ve already lost any anonymity you ever had. The federal govt has real time access to your checking accounts or credit card accounts.
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