Magazine article American Banker

Peppercoin Sold to Ore. Loyalty Software Vendor

Magazine article American Banker

Peppercoin Sold to Ore. Loyalty Software Vendor

Article excerpt

The Waltham, Mass., micropayment software vendor Peppercoin Inc. has sold itself to Chockstone Inc., a Portland, Ore., loyalty marketing vendor.

The deal closed Friday and was announced Monday. No price was given.

Peppercoin's aggregation software, which bundles several small transactions into a large one, lets merchants accept payment cards for low-cost goods and services while paying fewer interchange fees.

It can be used at the point of sale or online and can work with prepayment and subscription pricing.

Peppercoin also has been moving into the loyalty business. Last year it introduced software that connects payment cards to a merchant's loyalty program, enabling shoppers to accumulate reward points by using an enrolled card. Merchants say this setup is more convenient for customers than requiring them to carry, and present, a second card with loyalty account data.

"Peppercoin's done some really interesting stuff in the loyalty and rewards space," said Jeffrey Lipp, the president and chief executive of Chockstone. "We've actually started to see more of them in the market."

Though Chockstone already had a similar product for connecting payment cards and loyalty accounts, buying Peppercoin "adds more momentum to the path that we've been charting, specifically in the restaurant and convenience store industries," he said.

Garden Fresh Restaurant Corp. of San Diego and the Cambridge, Mass., coffee and ice cream chain Toscanini's are Peppercoin customers.

Loyalty programs that encourage consumers to use payment cards instead of cash enable merchants to collect valuable data on repeat customers and make targeted offers, Mr. Lipp said, and using a credit or debit card instead of a gift card encourages even more use.

"It's not just 'Deplete the card and throw it away,' " he said. …

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