PayNearMe Targets Small Billers with New Cash Payment Service (Jan. 22, 2013)
Jan. 22, 2013
Cash transaction network PayNearMe is taking its payment services small-time in a move the company thinks will pay off in a big way. The Sunnyvale, Calif.-based firm, founded in 2009 and led by CEO Danny Shader, has launched PayNearMe Express, a self-service version of its existing cash payment system, aimed at enabling small businesses to accept cash from customers remotely via a network of 8,600 7-Eleven and ACE Cash Express locations nationwide.
Shader tells Paybefore the new service will be aimed initially at landlords and property managers and lenders, who can sign up on online for the service and instruct their customers to do the same. Unlike the full-scale PayNearMe service, signup for PayNearMe Express requires no IT integration on the part of the merchant; only bank information and a one-time $199 fee. The pricing and easy setup help the company expand its possible client base exponentially, according to Shader.
When a registered customer receives a bill, it includes a unique barcode that can be printed or scanned into a mobile phone. The customer then visits a 7-Eleven or ACE, presents the barcode and pays with cash. The funds are guaranteed by PayNearMe and payees are notified in real time, without the security risk that often makes billers reluctant to accept cash. By bridging the gap between cash-averse billers and cash-preferred payers, including the underbanked, PayNearMe Express sees itself as a sort of “Square in reverse,” Shader says. While Square enables customers to use a payment card for small transactions that would typically be made in cash, PayNearMe enables cash to be used for larger payments that would typically be made via check or payment card.
In addition to the launch of Express, PayNearMe has also landed $10 million in funding, led by August Capital, with participation from existing investors Khosla Ventures, Maveron and True Ventures. The cash infusion will be used to expand the company’s network, including adding additional retail payment locations, Shader says.