Micropayments

Mar 08, 2008 - 09:18 AM PST

A pretty old idea relatively, and this comic explains it very well.

I for one am for micro-payments. If a company could reliably setup a micropayment system, that was secure, with a minimum of fraud and charges, they would effectively revitalize the market and the economy. We would enter an economy of ideas, of creativity and action.

Here's my proposal for a micropayment company, and how it would work.

Basically, the current stumbling blocks of micropayments are credit-card fees and processing fees, as well as inertia against the idea. The inertia can be fought by marketing and word of mouth.

The processing fees, however, can be countered quite simply. A person sets up an account with Micropay Corp. They pay $10 a month, to Micropay, and when they visit a website that supports Micropay payments, they can go through the process of “paying” that site. At the end of the month, Micropay takes that tiny amount, and transfers it to the account of that website. This transfer costs nothing, and instead, the reciever pays a low processing fee on the total amount, for example, $10 on $1000 in payment.

Whatever money is left in the customer's account is kept as a credit for the next month, and the customer pays whenever they visit a supporting website. Or, they can setup recurring micropayments, and just log in with a centralized ID to the website.

Of course there are security issues, but on the individual scale the money is just not worth it. To make $7500, they'd have to steal 25 cents from 30,000 people. Even on the scale of $10, that's still 750 people. On such a scale of action, it would be easy for the company to track down and block fraud on that level.

What do you guys think? I'd be willing to part with $10 a month to make micropayments to each content-filled site. 5 cents a month to visit slashdot, and get premuim access? Why the hell not?!