THE HELP DESK
Micro Lessons: Micropayments and Associated Technology
by Sophia Guevara
My change cup had run out—and gone with the change was my ability to do the laundry. Fortunately, I learned that the washing machines in my building have Bluetooth capabilities and are operable by a micropayment app. Unfortunately, my first experience in using it proved to be a failure. Necessity forced me to try again, and I succeeded in placing money in an account for future use. This experience piqued my interest in micropayments, and I learned that some of the transactions I had already participated in met the definition. So I decided to learn more about the technology surrounding them.
WHAT ARE MICROPAYMENTS?
According to Techopedia, most micropayment transactions average $20 or less. A Stanford University resource—“Micropayments: A Viable Business Model?”—although developed back in 2011, provides a good introduction to the three different models of managing micropayments as well as sections on micropayment history, issues, solutions, and references.
WHAT ARE SOME USE CASES FOR MICROPAYMENTS?
A 2018 Medium article by Sri Oddiraju discusses micropayments and their potential use cases. The use cases can be split into the following types:
- Resources on Demand—the pay-as-you-go business model; for example, wireless company Boingo can charge customers in increments of less than an hour for Wi-Fi service
- Content on Demand—the iTunes business model of purchasing individual songs, which news outlets could use to sell individual articles or video game developers could use to sell extra lives or additional features
- Services on Demand—transactions between people for microservices (simple tasks)
Oddiraju recommends keeping a “close eye out for the cryptocurrencies that are used in strategic partnerships for linking micropayments with resources, content, and services. …”
I came across an interesting 2017 article from CNBC that provides a review of the possible tax implications for bitcoin transactions. It points out that at least one Subway restaurant was accepting bitcoin from customers. As of this writing, SpendBitcoins shows that 589 restaurants of all types worldwide are accepting bitcoin.
HOW ARE MICROPAYMENTS BEING USED IN LIBRARIES?
My library uses a payment solution called Square. In the past, the library required patrons to pay for printouts with money that was preloaded on a card. Now, we can pay for printouts with a debit card, and the librarian processes the transaction using Square. While transactions under $1 require payment with good old regular coins, transactions at $1 or more can be paid with a card. There must be other ways for micropayments to be used in the information space. If so, how?