Everyone can take the credit

So, you want to buy something on the internet and save a load of cash, but you don't have a credit card? That's
a coincidence, because plenty of e-tailers would be only too happy to take money from you: it is just they haven't
had a means of doing so, according to much of the hype surrounding e-commerce and the disenfranchisement of
the credit-less.

Actually, that has always been an exaggeration. Most of the established sites offer alternatives
to credit card payment; Amazon offers "pay by cheque", businesses can buy from companies such as Viking
Direct by opting for a company account with invoices. The goods are delivered with the bill. But for consumers,
the immediacy of buying on the net is half the fun, and the speed with which goods normally turn up represents a
good percentage of the benefit.

So it is not surprising that experiments such as Mondex and VisaCash started
for small payments, although the hesitancy with which consumers have greeted the web means it is even less of
a surprise that these have met with only qualified success. The "here's a card but it doesn't involve credit" idea
doesn't seem to want to go away, though.

Its latest incarnation is SplashPlastic, a
card that works in the same way as a pre-paid telephone card. You buy your card for a sum of between ?5 and
?20, from schools, magazines or the website and top it up. It is aimed chiefly at the youth market.

Some
attempts at tapping this sector have fizzled out before launch; this one at least appears to exist. Logically,
though, it need not. If you are buying over the net you don't need a shop: therefore you don't need a card, just a
code that is mutually agreed.

A logical development, anticipated by PayPal in the US, is that individuals as well as
businesses should be able to send money to each other electronically. One of the first companies to allow this in
the UK is Nochex. It works simply enough: you set up your account and upload money from
your debit card, then email said cash to anyone else with an account. They can then download it into their bank or
wait until they have some more to put in. Uploads and downloads cost 99p a throw.

The service will help not only
buyers on the net but sellers - anyone with a UK bank debit card can have a Nochex account and since it doesn't
allow for payment by credit card, there is no chance of spending cash you haven't actually got.

"It's real money
so there's no risk," stresses Nochex chief executive Phillip Sheldrake. There is therefore no chance of a
chargeback and no chance of attracting the younger market, of which SplashPlastic appears so enamoured.

Extra
features are being added: recently the company started offering the Nochex Checkout, allowing people to order
several items from a single website and pay the total rather than a series of one-offs. The snag is that it only
allows you to send money to someone else with a Nochex account. An alternative comes from PhonePaid.

This
works on the same principle as Nochex but you send to a mobile phone number instead of an email address, and it
is done through the mobile phone network (accounts can be set up at www.phonepaid.com). If the person to whom
you are trying to send money does not want a PhonePaid account, the company will send a cheque.

Ultimately the
new forms of buying will work in the same way as the telephone: at the moment everyone is being asked to buy
the first one, and they don't want to get stuck with unusable credits on a card nobody accepts.

The players are
working out different solutions; Nochex is content for the moment to concentrate on people-to-people
transactions and let it grow "virally" - a buyer wins something in an auction and asks to pay by Nochex so the
seller joins, and so on; by the end of the year it is anticipated there will be half a million customers.



PhonePaid is
growing with an ad campaign and a handful of businesses have accepted it as a means of payment - a chain of
fruit juice bars, a restaurant and a nightclub among them.

A spokesman confirmed that the company was in talks
with a number of websites including www.fhm.com and www.ministryofsound.com; it was also talking to high
street retailers.

SplashPlastic is more of a traditional credit card: its site has links to a number of online
traders who will accept payment this way. The bottom line is that none yet has the reassurance or visibility of a
Visa or Switch merchant. This won't matter to the "individual to individual" style of sale targeted by Nochex and
PhonePaid but will be vital as they move into business e-commerce services. Each understands the need for this
sort of recognition: none has the clout that Mondex and VisaCash should have had in the market through the
sheer size of the brand.