Online Credit Services for Creditless Users

By Renee Boucher Ferguson  |  Posted 2000-12-11

Credit cards account for 90 percent of online payments. CheckSpace Inc. and Achex Inc. are taking aim at the other 10 percent with new tools that make it easier for consumers to pay online without using a credit card.

Some 100 million consumers dont have access to a credit card, according to a recent Nilson Report. And a good number of those who do have credit cards are leery of using them online.

CheckSpace, which allows vendors and consumers to post electronic checks for online payment, will announce next month wireless pay-by-check services and a paper check service for vendors. Also in January, the company will announce a payment reminder service.

The Bellevue, Wash., company transfers cash from a consumers bank account through the National Automated Clearing House network, or ACH, into a merchant or other account. ACH is run by the federal government and is used by financial institutions and others to transfer funds.

Separately, Seattle-based Achex, which uses the ACH network in the same way, announced last week that, the online retailer backed by Kmart Corp., had made the Achex service available on its site. Achexs payment method stores consumer financial information on its servers and does not send it over the Web to merchants.

Part of Kmarts overall strategy with its middle- to lower-income customers is to make the Internet more accessible, said Janet Ball, director of advertising for

"A lot of our customers dont have credit cards, and for some, they just dont want to put their credit cards on the Web," Ball said. "There is a lot of concern about security."

In the same vein, Kmart, of Troy, Mich., last week took over the operations of, which had provided free Internet access to customers but shut down because of revenue shortfalls. Kmart will operate Spinway as an independent unit at least through the holiday season.

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