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Two extremes in online payment

There are a couple of notable projects gaining momentum in the area of personal financial transactions.

First, there's Square. The premise is simple - quick, easy payments by credit card anywhere on a portable device (read cell phone) with a small dongle. I love the idea of integrated photos, e-mail receipts and so on. However, having spent the last month in an entirely cash-based economy I'm reminded how little I used physical cash in the US (usual sample size one disclaimer acknowledged). If the main scenario is to replace person-to-person or person-to-small business transactions, it'll be interesting to see how big that opportunity really stands.

On the other end of the spectrum we have Kwedit. Here we have a deliberately unreliable payment system where users can take on debt without any binding agreement to pay it off. There is an incentive to settle up, however, in the form of a credit score which tracks your level of debt. Payment by cash-in-the-mail or in-person at 7-11 stores seems like genius. If this gains any traction in virtual goods markets, even a 5% of payoff rate on a huge user could be very compelling.

Interesting space.