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RMP Protection founder Ricky Rand says his CarrotPay software functions online in much the same way that coins are used in traditional transactions
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No matter how good a website is, most online shoppers would agree that paying for purchases on the Internet can be far more complicated than using cash at that shop around the corner. Now, a Hong Kong-based company has come up with what’s hailed as the world’s fastest online payment system.
CarrotPay is a web service that allows even very small payments to be made in a few seconds. It was developed by Internet security company RMP Protection Ltd, originally as a means of tackling online junk mail, or spam. RMP Protection’s CEO Ricky Rand said the idea was to create an email token worth cold hard cash. He realised that email users could be confident about accepting messages if something of value was attached.
“A spammer would never send you something of value,” said Mr Rand. “Then, the idea was to make it free for ordinary email users, because everybody wants a free system. If you could simply reuse that token to send out on another email, then it’s free for people who receive about the same number of emails as they send,” Mr Rand explained from his office at the Hong Kong Science and Technology Parks (HKSTP).
“Now, if you think about it, that sounds a lot like a coin – something with value that you can move quickly and simply between people. And it didn’t take long to figure out this is actually the bigger part of the thing we wanted to develop. So we moved very much into a payment domain.”
With the support of the HKSTP’s business incubation programme, RMP Protection went on to develop CarrotPay, a web service that includes free software and offers buyers “complete safety and the fastest payments on the web.” CarrotPay also allows sellers to offer digital items from as little as one-tenth of a cent per item – with transaction fees kept at a flat rate of 2.5 per cent.
Digital Purse
While the Internet has long used credit cards or payment services for money transfers, Mr Rand pointed out that, until now, there has never been a good equivalent to the coins, notes or cheques that retail shoppers normally use.
“What that means is that while we could use coins in the real world, we couldn’t sell or buy in the same way on the Internet. CarrotPay makes the difference, as you can now spend a few cents in a few seconds, without giving away any personal information.”
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A demonstration of how
a CarrotPay “purse”
is used to pay for an
online video game
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CarrotPay works with the cooperation of simple software that shows up on a computer desktop. It functions like a digital “purse,” which can hold money, in the form of Carrot-WebCoins, transferred to it from your bank account or credit card. The software communicates with the seller’s website and selects the correct “change” to pay. It will even exchange your coins into the currency demanded by the seller, if you don’t already have that currency available in your purse.
“What it will do is allow merchants from all over the world to sell very small valued items very easily and very conveniently. In particular, anything that’s electronically deliverable, whether it be information, music, poetry, a blog, a recipe, a ringtone or video – the list is endless – they can now all be sold individually and immediately delivered through the network straight to your screen.”
Growing Mainland Carrots
CarrotPay is expected to prove to be more versatile than the radio-frequency ID cards such as the Octopus, which is already popular with Hong Kong commuters. Mr Rand said CarrotPay technology “can do more interesting things, like exchanging value even when the sender and recipient are not online at the same time," similar to what is possible with his CarrotMail anti-spam solution.
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CarrotPay’s name stems from its development days, when researchers were trying to find a “carrot-or-stick” approach to
fighting spam
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Mr Rand said Hong Kong is also the perfect place for his company to build long-term business on the Chinese mainland, where Internet commerce is, in many ways, more developed than traditional banking. CarrotPay has already proven to be a success with the mainland’s online gaming companies, which are trying to attract gamers willing to pay a few cents to play. Previously, any profits from those small payments would have been eaten up by fees. Mr Rand believes the same business model will apply to many other online transactions.
“We can make banking transactions to and from a person much more conveniently and cheaply than we can here in Hong Kong, or in the United States or Europe,” Mr Rand said.
“So, in many ways, it’s actually very attractive to be working in China. As for take-up, the mainland’s massive population of students ready to adopt new technology is second to none. So there is really a huge opportunity to get there.”
Related Links
Hong Kong Science & Technology Parks Ltd
RMP Protection (CarrotPay)
