Glossary
What do the technical terms mean
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Payment does not have to be complicated. However, there are technical terms that are often not common.
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Micropayment
There is no fixed amount, but amounts under € 10,- can be considered as micropayment. Visa and Mastercard specify a minimum amount of € 30,- to be able to charge transactions above this amount. In the press area, payments around € 2,- for news and newspaper articles are considered micropayments. Micropayment is relatively expensive, since discount rates of 20% to 30% must be taken into account for Micropayment.
Economic efficiency
The cost-effectiveness of paying small amounts is a problem, as the cost of processing payments often exceeds the value of the goods. This creates a payment system gap, as conventional methods such as credit card payments or direct debits are unsuitable due to high costs. For this purpose, various strategies have been developed in order to be able to settle very small amounts in a meaningful way.
Strategies
At the moment, there are three types of micropayment systems: Pre-paid systems, billing/collection systems and mobile phone-based systems. In the so-called pre-paid system, the amount of money is deducted in advance from the customer's credit account. Billing/collection systems add up the smallest amounts, which are then billed periodically, e.g., via the telephone bill. Mobile phone-based micropayment systems enable location-independent payment for services; one example is Multicall from the company CommDoo.