CloudZync Takes on Mobile Loyalty with Zync Wallet

CloudZync has launched a free iOS and Windows Phone app for consumers to make mobile payments and redeem offers, with 280 independent retailers in Greater London already signed up to accept transactions. 

The company’s co-founder and CTO, Andrew Smith, says that retailers, particularly small businesses, will benefit from the cloud-based Zync Wallet platform, where they can set up their own payments, sales and marketing programmes to improve and personalise interactions with their customers.

So where does the ambitious Essex-based startup, which after raising an initial seed round is in the process of securing Series A funding, sit in the crowded payments space? 

Users have to set up an account with Zync Wallet, loading money from their bank account to spend at participating stores via a direct debit or standing order. While this process isn’t as easy as one-click, the founders hope this will appeal to people who are keen to limit themselves to a budget, while also showing that payment details are never shared with the retailer or the company itself.

To make an in store payment, the merchant tots up the total on their business app, POS or on the web portal, while the user enters the security PIN to unlock their app and then generates a unique barcode for the merchant to scan, much like PayPal’s inStore app. Users will also be able to pay at participating retailers online using their mobile number and then the PIN entry system to authorise the Zync payment.

If the customer has opted-in to a loyalty scheme via the app’s Hub or claimed a deal, Zync Wallet automatically applies any discounts and adds up points. And if the user checks-in to the wallet while out and about, they will be notified of relevant stores offering local discounts to Zync users. Smith said that merchants will be able to set limits on offers so they arent flooded with people trying to get money off. There are also a whole host of ways retailers can customise their Zync programmes to improve customer service, he explained, including deploying customer surveys, intergrating product warranties and offering smart receipts.

How does it measure up?

Incorporating both payments and loyalty puts Zync Wallet ahead of the likes of Apple’s Passbook, which still only offers a limited number of mobile ticketing options in the UK, and can only be accessed by iOS handset owners. Samsung Wallet, which has just launched for Samsung handset owners using Android in the US, is likewise limited to loyalty. 

Although PayPal says deals functionality is offered on its mobile payments platform, it doesn’t appear to be live on the inStore app, which counts Warehouse and Sole Trader among its participating stores. 

For merchants, Zync also has the advantage of not requiring any new hardware to get started, unlike most mPOS solutions or NFC-powered systems like Google Wallet. Merchants just have to check a photo to confirm the identity of the user when making making the transaction – not unlike PayPal’s facial authentication pilot launched last week through its app, which is currently limited to merchants that accept PayPal Here

If they sign up to a full-service business plan with CloudZync, which start at £40 per month, merchants don’t pay any transaction fees. The alternative is a pay-as-you-go option which starts at 5p per transaction for every 1,000-5,000 sales made per month. So, if a small business owner makes 1,000 sales at £5, they can expect to pay £50 in fees. With an mPOS provider like iZettle, by comparison, they’d pay around £96.

What next?

CloudZync is regulated by the FCA and uses Barclays to look after the money loaded onto the Wallet by users. It will be launching its own marketing campaign, particularly targeting early adopters likely to be found on Facebook and Twitter. They are also working on an Android app to launch soon too.

CTO Smith added: “This is not just payments. Zync Wallet is about engagement, retention, better customer service and incentivising people to get back to your store or online, using one wallet. It is very different to competitors – and a hell of a lot cheaper.”