Monday, April 6, 2009

Revolution Money Challenges Credit Cards, PayPal

A revolution in money

We’re all looking to cut costs. Consumers are trying to spend less, even if it is contrary to how the economy receives greatest stimulation. When people shop for payday loans, they’re looking for low cost. When merchants want to cut costs, they look at expenses and see where savings can be had.

Ty McMahan reports for the Wall Street Journal that major financial firms and investors have contributed $42 million in venture capital into Revolution Money, a payment-processing company backed by AOL co-founder Steve Case.

What do they do?

Revolution Money cuts costs by providing an online portal through which merchants can accepting credit card payments. The cost is decreased for merchants by up to 75 percent for transactions, and the merchants can then pass part of that savings on to consumers as lower prices for goods. The company expects to steal market share from both traditional credit card companies and payment services like PayPal. According to reports, the post-money valuation (after investment has been made) of Revolution Money is less than $200 million. ... click here to read the rest of the article titled "Revolution Money Challenges Credit Cards, PayPal"

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