UK bill payments firm buys Verrus
By Robin Arnfield, News Editor
VANCOUVER--PayPoint, a UK-based bill payment service provider, has signed a deal to buy Vancouver-based Verrus Mobile Technologies and its subsidiary Verrus UK.
Verrus provides services enabling consumers to pay for parking by credit or debit card using their cellphones in North America, the UK, Australia and France. It was founded in Vancouver in 2000 and entered the British market in 2004. As of March 2010, around 2 million consumers have registered to use Verrus.
“We’re paying £25 million (C$38.73 million) up-front plus a deferred consideration of £4 million (C$6.2 million) and an additional £4 million which is dependent on three-years’ financial results from Verrus,” says Peter Brooker, PayPoint’s Head of Corporate Affairs. “The total amount is £33 million (C$51.13 million).”
Verrus will continue to be managed by co-founder Desmond Griffin in Canada and by its UK CEO Robin Bevan in Britain.
Verrus has 100 cities using its parking payments technology including Vancouver, San Francisco, Miami, Boston, Washington DC, Sydney, Australia, and Paris, France. “Westminster City Council in London, UK, uses Verrus for virtually all its parking payments, and credits Verrus as having helped it to expand its parking revenues by 45%, while reducing its parking costs by 20%,” Brooker says.
The advantages for a municipality of using Verrus for parking payments includes a reduction in thefts from coin-operated meters, and elimination of lost revenue from out-of-order meters.
Verrus enables drivers to link payment cards and car registration numbers to their cellphones via SMS text messaging, mobile browser, or interactive voice response (IVR). Payment is made by SMS, specifying the location and amount of time required, without the driver’s card details being disclosed to the municipality or private car park operator. A reminder text is send five minutes before the parking permit expires, asking if the driver wants to extend the parking time.
Verrus has also developed a platform enabling consumers to use their cellphones for taxi fares, bike rentals and event ticket purchases.
In the UK, Ireland and Romania, PayPoint operates networks of terminals in convenience stores that enable consumers to top up their prepaid cellphone accounts and pay their utility and tax bills by cash. “We plan to integrate Verrus’ parking payment technology with our UK network, so consumers can pay for parking at our terminals,” Brooker says.
PayPoint currently has no plans to roll out its bill payment service into Canada. “We look for markets where there is a high percentage of cash payments, and Canada is a country where debit and credit cards are very popular,” Brooker says.
“Parking is one of the remote payment services where SMS-based m-payments will fly,” says Financial Insights senior analyst Rob Burbach. “The fact that Verrus was able to be sold by its owners to PayPoint shows there is traction in mobile parking payments.”
Burbach says that Verrus is making good progress in Canada with its cellphone-based parking payment service. “But the problem for Verrus will be the fact that municipalities have to replace their old coin-operated parking meters with electronic meters that work with Verrus,” he warns. “If cities are cash-strapped, they may not be able to afford to install electronic meters.”