CardSpring’s Payment Cards Apps API Debuts at SXSW

U.S. online coupon site RetailMeNot.com is partnering with CardSpring this year at SXSW to roll out the latter company’s “mobile and web applications for payment cards” technology. In this instance, RetailMeNot is using the CardSpring API to tie coupons directly to user credit and debit cards, which allows those users to then have the coupon applied instantly when they make a purchase at one of Austin’s participating food trucks over the course of the festival. But that’s just the start for CardSpring.

The RetailMeNot program, dubbed “What the Truck?”, shows off one of the more obvious potential use cases for CardSpring’s tech. By allowing RetailMeNot to link coupons directly to its members payment cards, you eliminate the need for shoppers to print anything, or even scan a barcode on a mobile device, or in fact provide anything beyond the card they’re using to pay. The CardSpring API in this instance makes deals and discounts that much easier for consumers to take advantage of, which should in theory make them much more likely to have a pleasant overall experience and become repeat customers.

BetaKit spoke to CardSpring CEO Eckart Walther, who explained that what RetailMeNot is doing at SXSW is just the tip of the iceberg. “We’re an application platform, just like the iPhone is an application platform for the mobile network,” he said. “We want to do the same for the payment network.” As an example, he talked about how Square now offers its own built-in rewards program for users of its mobile payment technology; CardSpring’s API could provide the same kind of loyalty offering to anyone accepting payment cards, regardless of whose technology they’re using to complete those transactions.

Other possible use cases Walther discussed included enabling companies like Zynga to partner with real-world retail chains to provide in-game rewards for customer behavior. Someone who shops at McDonald’s, he suggested, might be able to unlock a McDonald’s blimp in their Farmville farm. Or service providers could use it to automatically notify customers about scheduled visits  – someone paying for an oil change with a card linked to a CardSpring API-enabled merchant could be sent an email notification when their next oil change is due, for example.

For businesses, CardSpring’s technology offers a way to attach more meaningful data to the transactions it processes. Just like traditional loyalty programs provide companies with valuable data about historical trends which can help lead to better retention strategies, so too can CardSpring’s app layer provide valuable insight into shopping habits and practices. And since using them is even easier for clients than carrying around loyalty cards, in theory CardSpring should result in higher usage rates among consumers.

Walther pointed out that currently, a lot of loyalty programs require repeated, manual input, like filling in your frequent flyer number when booking airline tickets. “That’s how ancient that world is today, and you simply let people make these cards smart again by connecting services to them,” Walther said. But CardSpring isn’t just about reinvigorating traditional methods of payment – it can just as easily be paired with newer solutions like Google Wallet.

“Since we sit in the payment network, there’s no difference whether you use your Google Wallet to pay, or a physical credit card with us,” Walther explained. “It’s all a cloud-based service.” CardSpring’s flexibility is virtue that should allow it to remain relevant in the white hot mobile payments space, even if one major player like Isis, Google Wallet, or (as has been rumored) Apple ID eventually emerge as the dominant power in terms of actually processing transactions, since in theory it could integrate with all the above solutions.

CardSpring, which launched its private beta at the end of November and has $10 million in Series A funding from Accel and Greylock, makes money by providing its API to financial institutions, which then sells the product on to merchants and provides CardSpring with a percentage of the revenue. CardSpring counts First Data as its first partner on the payment side, which powers almost half of retail commerce in the U.S., or around 4 million businesses, Walther said. And while CardSpring is initially available only in the U.S., First Data’s network spans a number of countries, and Walther said chances are good they’ll be looking to expand internationally before too long.

Photo credit: Images_of_Money via photopin cc, original credit http://taxbrackets.org

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