Fortumo is an Estonian startup (see our previous coverage) focusing on making it possible for everybody from individuals to home-based businesses to global web entrepreneurs to easily and cheaply collect payments from their customers using mobile payments. The company emphasizes that it should be as easy, quick, and cost-effective to start using mobile payments on your site or in your app as creating a blog or a homepage.

Fortumo has now released a new service called FortuMoPay, designed for selling credits (to be used e.g. on virtual goods) in online games, web applications, and social networks.


The company pitches that setting up FortuMoPay typically takes no more than 5 minutes and requires minimal technical skills. With the solution, the merchant specifies the amount to charge for 1 item or credit. FortuMoPay then automatically handles the activation of all corresponding short codes and keywords, credit packs based on the available SMS price points in each country, and currency conversions for all countries.

You can try out the functionality with the below button (and don’t worry, ArcticStartup won’t charge you for this demo – though it did cross my mind…):

Mobile Payments by Fortumo

There are several large competitors in the virtual goods payment market, the couple of the biggest ones being Boku, backed by tens of millions of VC dollars, and Zong that just landed a $15 million VC investment, and also getting traction from enabling Facebook Credit purchases.

However, Fortumo’s service does not fall much short of these bigger competitors. Indeed, Boku covers operators in more than 50 countries, but Zong reaches barely 30. Fortumo now supports 36 countries, and has an ambitious but achievable goal of reaching 50 countries by the end of 2010. They expect to launching in the US still by the end of June, and in Latin America and Africa shortly afterwards.

Fortumo’s co-founder Rain Rannu explains to us that the advantage of Fortumo is the focus on openness and quick startup. The bigger service providers are not interested in small and medium sized businesses, let alone individuals, while Fortumo gets all new services live within 24h after reviewing them, regardless of the customer size.

In any payments, low friction is the key – add more steps, and you’ll lose more and more people at each step. Thus, while the costs are much higher in SMS, a short straight-forward payment flow can more than make up for the percentages.

Of course, with mobile payments now being dead simple and frictionless on the web, it the need remains for making mobile in-app payments similarly easy in mobile applications. Yes, there have been a few providers for some years, but very few if any services which would allow very easy integration, offer great country coverage, and which you could tap into without any upfront or monthly fixed costs.

Luckily, Rannu discloses that Fortumo is now working also on an Android in-app billing solution, which will be released shortly. While Fortumo’s current payment HTTP APIs can already be used in mobile applications, they will introduce an easier solution for mobiles. Fortumo’s team is also working on Java J2ME, Symbian, and Blackberry in-app payment solutions, but Rannu would not yet estimate in more detail when those will be ready.

Since its launch in 2007, Fortumo has acquired over 40,000 registered service providers who have created over 110,000 mobile payment services, which currently serve over 1.5 billion mobile subscribers on 4 continents. Fortumo takes, on average, 5% commission from the sales.