BUYERS BEWARE : To anyone who is thinking of buying VSMR.
A friend of mine is the inventor of a patented system that enables cardholders to turn on and turn off their card accounts. It also allows cardholders to set other limits. VISA also applied for the same patent but VISA came in 14 months later than my friend. My friend's patent application was awarded the patent by USPTO and she has worldwide PCTs for it. I asked her to take a look at VerifyNGo and to tell me if this system would work. She is a monetic expert, by the way. This is what she told me (actually I've cut and pasted from an email) :
VerifyNGo will not work in REAL card transaction scenarios. A card transaction once it leaves the merchant's POS (point of sale), goes to the Issuing Bank within a couple of seconds. The Issuing Bank then approves or declines the transaction. The Issuing Bank or its authorization processor will NEVER pause to do what VSMR announced that its VERIFYNGO will do, which is to send a SMS to the cardholder, and wait for the cardholder to respond prior to approving or rejecting the card authorization. The authorization process CANNOT be interrupted.
Another reason why VERIFYNGO will not work is that not all card transactions need authorization. Some card transactions that are below floor limit will go directly to settlement (which is batch). For transactions that are above the floor-limit, authorizations are sometimes done on a real-time basis and some are done via batch.
She said, "Believe me. If there is anyway VerifyNGO can work, VISA or Mastercard would have done it a long time ago." She also said that investors should ask VSMR about the 'pilot'/'testing' of VerifyNGO. She said that VSMR could perhaps have set up something with one specific merchant's system to send a SMS to the cardholder, then wait for the response of the cardholder before giving it to the payment processor of that specific merchant, which would then send it to the Issuing Bank. In order for VSMR to prove that their VERIFYNGO works, they would have had to implement their system with a Bank's authorization system (NOT a merchant's system).
If VSMR intends to implement VerifyNGO with merchants, they will have a difficult time offering it to cardholders (just like Verified by VISA). Cardholders would not want to use VerifyNGO if there are only a handful of merchants using it, since the card will remain vulnerable with all the other tens of millions of other merchants.
If they piloted their system with an Issuing Bank and it works, then why did this Issuing Bank not offer it to all their cardholders? The answer is, it's likely that VSMR did not test VerifyNGO with an Issuing Bank.
I have also said the same about MOBICLEAR (see my previous post). MOBICLEAR started a couple of years before VSMR and Mobiclear did not go anywhere.
Bottomline, partnering up with Mr. Theodore 'Teddy' Permadi Rachmat does not do a thing with a system that will not work in real live scenarios.
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