July 24, 2000

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Improved Payment-System Platforms

PaymentWave service lets businesses verify and authenticate all involved parties

By Cheryl Rosen

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nibex Inc., which is building online marketplaces for 20 companies, last week signed on as the first customer and new partner of PaymentWave LLC. Unibex plans to offer PaymentWave's new online payment-processing system on those sites within 90 days.

"When it comes to business-to-business, companies don't use credit cards for transactions, and purchasing cards don't really do the job," says Mady Jalinous, Unibex president and CEO. "We needed a platform that allowed options for payments: credit cards, fund transfers, ACH [automated clearinghouse], escrow, and letters of credit for overseas transactions. A payment system that allows you to verify and authenticate both parties is a very serious requirement. PaymentWave enables us to offer flexibility of payment and a trusted environment."

Buyers and sellers on Unibex sites will be able to review purchase orders and pay them online. PaymentWave plans to add the ability to authorize different types of electronic fund transfers in a variety of global currencies.

Unibex has built, or is building, seven marketplaces for the 350 associations under the National Association of Manufacturers umbrella, including sites for auto-parts rebuilders and the confectionery industry, and it has 10 more under construction.

Launched in May, PaymentWave is a joint venture of Western Union parent First Data Corp. and Entrust Technologies Inc. It has invested $4 million in Unibex in return for a share of the revenue.

For Jalinous, adding online payment vehicles is key to allowing marketplaces to reach their potential. "Our customers seem to think that until or unless a transaction is completely and fully automated, including payment, it doesn't reduce cost much," he says. "As long as you have to keep an offline paper trail of everything you do online, you're just doubling the work."

John Duncan, executive VP of PaymentWave's Internet Commerce Group, says the company will expand its services to include fraud-protection coverage, logistics services, and document management.

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