Clinkle, a mobile payment app and network started by a recent Stanford University grad, recently received $25 million in funding from big names like Peter Thiel in an initial round led by Accel Partners. Part of Clinkle’s appeal is that merchants won’t need any new hardware to accept payments, but few details about the company or their technology are known.
While little has been publicly released about how Clinkle will actually work, investors must have seen something worthwhile as the company raised $25 million in seed funding from Accel Partners, Andreessen Horowitz, Peter Thiel and the co-founders of VMWare. To use Clinkle, both consumers and merchants will download the free app. For consumers the payment app will be connected to exiting credit cards and bank accounts, and they will be able to use the mobile wallet app for payment with any merchant that also has the app. It has not been disclosed how the devices will communicate, but Clinkle will not rely on NFC technology and will not require any hardware upgrades from merchants.
With the $25 million in funding, Clinkle is expected to move beyond their initial roll-out phase by this fall and build out the needed security and compliance features, which are major factors for any payment system. Initially Clinkle is focused on gaining traction in college communities, but a lot is yet to be seen on whether it can emerge as a viable payment option, especially as security features are just now being addressed.
The fact that merchants won’t need NFC or other hardware upgrades may be a strong differentiating factor as the reliance on NFC has hindered the adoption of Google Wallet and others in the space. But some industry analysts expect the upcoming EMV mandates requiring merchants to upgrade their POS terminals in the U.S. to lead to more NFC-enabled terminals as well. Meanwhile NFC contactless payments are continuing to grow in Europe. It remains to be seen whether Clinkle will become a major player in the mobile payment industry, or just another name in the increasingly crowded space.
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