Mobile payment solutions

Invuo Technologies

Seamless is a global software company specialized in technology solutions for mobile payments. The subsidiary MeaWallet provides a service platform for mobile and digital payments, enabling HCE/Tokenization and Masterpass. MeaWallet together with eProducts, distribution of electronic products, constitutes the future of Seamless as SEQR is to be divested.



A company in change

In 2017, Seamless has undergone major changes. Seamless Distribution Systems (SDS) was divested through a listing, and the ambition is to sell SEQR soon. Thus, the Group will consist of MeaWallet (service platform for mobile and digital payments) and eProducts (distribution of electronic products). The company will therefore focus merely on Business-to-Business (B2B) and will no longer be dependent on attracting consumers to their products, which historically proved to be both challenging and costly. The Group will also be renamed to Invuo Technologies AB.

MeaWallet

MeaWallet offers a service platform for mobile and digital payments, enabling HCE (Host Card Emulation)/Tokenization and Masterpass. The platform can handle both domestic and international payments. Tokenization means that sensitive data elements are replaced with unique identification codes which contain the necessary data without compromising their security. The process is used to increase security for mobile and digital payments. HCE is a software solution that generates virtual cards.

Through the company's Mea Token Platform (MeaTP), customers (usually banks or card issuers) can offer their customers apps and third-party wallets using HCE and Tokenization. In addition, the company offers the products Mea Master Pass (online and app purchases), Mea Converged Wallet and MeaCBP (cloud-based payment platform for HCE and Tokenization).

MeaWallet intends to benefit from the migration from physical to digital payments as well as the new PSD2 regulations, which together can be expected to strengthen banks and card issuers' incentives to offer Near Field Communication (NFC)-based mobile wallets. In Eastern and Southern Europe, NFC is already widespread and from 2020, the card networks (Mastercard, Visa, Amex) require all payment terminals to support NFC.

Sales within MeaWallet derive from initial license revenues and variable recurring revenue. The former is generated in three steps, when the customer places the order, receives delivery and offers the service to their customers. In addition, MeaWallet obtains an annual fee per digitized card. The implementation phase takes about 3-6 months, which, according to the company, is rapid relative to peers. A typical order is worth 300,000 - 500,000 euros over a 3-5 year period.

MeaWallet is currently competing with around 30 peers. The company's solution is already certified for Mastercard and Visa and is expected to be approved for American Express soon, according to management. MeaWallet would then be one of few companies globally able to offer a digitalization solution for all three major card networks. Among the competitors are larger companies such as Gemalto, Giesecke & Devrient and Oberthur Technologies, but also smaller local players such as Payair.

MeaWallets short-term goal is to reach a 10% market share in Europe and so far, four customers are live. The European market, where MeaWallet has focused its resources so far, includes approximately 6,000 banks - of which approximately 2,000 are expected to invest  in NFC payments in the next three years - and approximately 6,000 card issuers. In the coming years, the company will explore opportunities for new markets such as the US and Asia.

eProducts

Seamless eProducts provides physical and electronic distribution of e-products such as distribution of electronic prepaid cards (refill codes) and other electronic products through retailers, banks and online channels. The operations are characterized by low gross margins, but in return, they require limited capital. eProducts accounts for approximately 90% of the Group's sales. The division operates in Sweden, Denmark and Latvia (to be divested).

The term eProducts includes, for example, prepaid cards / refill codes, electronic gift cards and prepaid value certificates of other kinds. For retailers, eProducts allows for increased sales and consumer inflows without the need for investment, capital, inventory or products requiring retail space. When distributing these products, value codes are delivered electronically, and costs are incurred for the store when the item is sold.

Financial assets in Seamless Distribution Systems (SDS)

Seamless has two significant financial assets - both linked to Seamless Distribution Systems (SDS), which were listed on First North in 2017. Firstly, Seamless holds an interest-bearing loan on SDS of MSEK 50, at an interest rate of 8%. In addition, Seamless holds more than 23% of the shares in SDS.

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