HSBC has entered an alliance with Yahoo to deliver a co-branded, person-to-person, payments system to consumers worldwide.
Under the agreement, the company's current US payment service, Yahoo PayDirect, will be expanded globally and named 'Yahoo PayDirect with HSBC'.
A PayDirect account is an online stored value account that enables users to send and receive money via email. Money can be transferred in and out of the online account by linking to a user's actual bank debit and credit accounts, regardless of which bank they hold these accounts with.
The PayDirect account pays no interest, and originally funds in the US accounts were maintained with CIBC National Bank and all fund transfers were provided by them. From the third quarter this year, possibly as early as September, HSBC will take on this role in the US and the service will then be rolled out in all of the markets that HSBC and Yahoo serve.
Richard Kimber, HSBC's head of personal ebusiness for Asia Pacific, says he expects the service to be launched in Hong Kong and other advanced Internet economies in the region around the beginning of next year.
Customers can use the online accounts for person-to-person payments, and also for services such as classifieds, auctions and shopping on the Yahoo network, and HSBC's websites.
"You can attach money to an email just as easily as a PowerPoint presentation," says Kimber. "This opens up a whole new customer segment for ecommerce."
HSBC plans to mount a comprehensive online and offline marketing program to make their products and services available to Yahoo's 200 million consumers worldwide. Yahoo will similarly market its services to HSBC's 28 million customers.
"With this agreement, HSBC becomes our global financial partner, helping ready us for our next phase of growth and further extending Yahoo's leading financial and commerce services," says Greg Coleman, executive vice-president, North American operations, Yahoo. "We are thrilled to be working with HSBC to enable more consumers on a worldwide basis to transact on the Web."
Yahoo and HSBC also aim to make the Yahoo PayDirect technology available to other companies to enable ecommerce and person-to-person payment capabilities.
