January 18, 2012

Clover Payment Service: Send, Receive Money Using Your Phone

Clover payment service: send and receive money using your phone.

Clover provides a simple way to pay and get paid using your iPhone or Android phone. Like Paypal, Dwolla and others, Clover can be used by buyers and sellers and for person-to-person financial transactions.

Clover creates a secondary payment mechanism for you, using your phone, and integrates with your primary payment mechanisms such as your bank/ACH, your credit/debit cards and your Paypal account.

The Good
You can easily send or receive money from anyone just using your phone.
Person to person transactions are free.

The Bad
Clover fees for merchants is quite high (3% of the transaction) and they actively discourage use of credit/debit cards to fund your Clover account or to withdraw money to Paypal or Amazon Gift cards. Clover prefers that you use Bank/ACH to fund your account or withdraw money from it.

In a Clover vs Dwolla comparison, Dwolla will always win with its low fees.

Should I Use Clover?
It depends.

If you are ok with Clover’s fees and your other party is willing to use Clover then by all means.

As with other secondary payment networks – Paypal, Dwolla, Square etc – Clover faces the challenge of growing its number of users, so the network actually becomes useful to all. Paypal has crossed this hurdle, and it seems that Square and Dwolla will cross it sometime.

Clover’s second challenge is charging a low enough fee that is acceptable to users and which delivers profitability for Clover.

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