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Plastiq lets you pay any bill with your credit or debit card just by snapping a photo

TechCrunch TechCrunch 21/04/2016 Sarah Perez

A new iPhone application launching today called Plastiq lets you pay any bill with your credit or debit card just by snapping a photo. The goal with the app is to offer something designed for mobile, that’s also more convenient than using a bank’s online bill pay feature. And more importantly, it allows bills to be paid with plastic – hence the name – as opposed to being drafted from your bank account.

The company says its primary audience is credit card holders who like the convenience of having all their bills paid on a single card, for example, or who like to pay with credit in order to accumulate rewards.

To use the app, which works in the U.S. and Canada, you don’t need to have already signed up for a Plastiq account – you can do so directly from your mobile phone by providing your email address.

Then, you simply snap a photo using the phone’s camera, and the app will analyze the information on the bill to determine things like the amount owed, due date, and your account information (like an account number or memo line).

You can then choose to pay the bill immediately, or opt to “save for later.”

This latter feature is especially useful as it will add the bill to your virtual “bill stack” in the app, then send you a push notification when it detects it’s time to make that payment.

Of course, that notification doesn’t arrive on the due date – that would make the payment late. Instead, it’s sent just in time to meet that due date, while also allowing you to pay at the last minute before a late payment occurs. This lets you maximize the funds in your account if paying by debit, or take advantage of a higher credit limit when paying by credit card.

The mobile app, which was built in partnership with design firm IDEO, is an iteration on an online service previously launched from the Boston-founded, now San Francisco-based startup.

  1. Payments history

  2. Bill stack

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With a heavy focus on bill pay, the company first launched its service in Canada to test the market, and then brought its web application to the U.S. last year.

Today, that online service has grown to half a million customers, the majority of whom are repeat users.

Customers use Plastiq to pay for a variety of services, as well as for recurring payments, like rent, insurance, or car payments, as well as for less frequent needs like taxes or tuition.

Plastiq accepts the three major credit cards: MasterCard, Visa and American Express.

For businesses set up to receive electronic payments, Plastiq will handle that process for you. But many people use the app to pay those businesses that require cash or checks. It will actually cut a check for you, like your bank does, then send it out by mail.

The difference is the funds came from your credit or debit card, not your bank account.

The startup generates revenue by charging customers a convenience fee of 2.5 percent for credit card transactions and 1 percent for debit.

The company says it has some provisional patents around the payment process and reading information from the bill. However, it has largely modified existing OCR technologies to its own ends and then combines that with manual review in order to ensure accuracy. That means you can trust it to not screw up your bills.

However, despite the similarities with other payment applications like PayPal, Square Cash or Venmo, Plastiq’s CEO Eliot Buchanan clarifies that the company is not targeting the peer-to-peer payments space with its new mobile product. While you can pay an individual like a contractor, nanny or some other service provider, Plastiq verifies that the person being paid is actually a business.

“We’re not for paying your friends back,” he says. “You can pay any business or service where cards aren’t accepted but we don’t do true p2p,” Buchanan explains.

The founder also notes that the mobile app is a result of Plastiq’s current customers demanding a way to pay any company or service provider more quickly using their phone. Nobody likes paying bills, but the company believed they could make it a better experience.

“How do we make bill payment as easy as taking a selfie? Snap a photo, add your credit card payment, pay a bill,” says Buchanan.

The Plastiq app is a free download on iTunes.

The startup is a team of 30 in San Francisco, and is backed by $20 million from Khosla Ventures, Atlas Venture, Flybridge Capital Partners, and others.

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