Cheque, please?

 by C. S.-W. 

“AFTER a good dinner one can forgive anybody, except for slow servers,” Oscar Wilde might have written were he to pen “A Woman of No Importance” today. Satiated diners have a one-track mind: pay for the meal and leave as quickly as possible. Yet they are often compelled to linger, firstly to attract the attention of a waiter, and then to wait as a credit card terminal is brought to their table.

It is a problem Tom Weaver recognises well. Researching diners' experiences, he discovered that it can take more than ten minutes for a party to pay for the food at the end of a meal. For groups bigger than six, each diner adds another 90 seconds to the transaction.

His app, Flypay, claims to cut that time down to a minute. Integrating with restaurants' existing payment systems, Flypay allows customers to pay with their phones by downloading an app and scanning a QR code on their table, or waving their handset over a near field communication (NFC) tag. The system is currently installed at branches of Wahaca, a Mexican-food chain based in Britain. Flypay has reached agreement with another ten major restaurant brands in the country, which will begin using the system shortly. In the system's first few weeks between 5-10% of a restaurant's bills on an evening are processed via Flypay. As customers become more used to the technology, that number can reach 20%. Interest has been high enough that Entreé Capital, a mobile payments capital firm, has given Flypay £1m ($1.7m) to develop the service further. Mr Weaver envisages branching out into other areas of hospitality: conversations are ongoing with pubs, and hotels could also use the service.

At the same time as Mr Weaver has been developing Flypay, Mark Egerman and the co-founders of his company have built a beta version of Cover, a mobile payment app for restaurants. They released the app to the wider public in New York and San Francisco in October 2013. More than 100 restaurants, including the tony Momofoku chain’s New York outpost, now allow customers to pay for their bill using the Cover app.

Using wireless (Bluetooth) technology, Cover recognises when a diner enters a participating restaurant. Connected to a pre-registered credit or debit card, the app allows diners to add a tip, split their bill, and pay for their food without waiting. Cover do not disclose the precise share of the bill it takes, but Mr Egerman explains it is equal to or less than the standard New York card handling fee, between 3.2% and 4.7%. Hundreds of thousands of dollars are spent each month via Cover, with up to 150 bills being paid through the app in participating restaurants each night. Cover has attracted venture capital too: it has raised $5.5m earlier this month, which will allow the company to double its workforce from its present 11.

Cover’s business model is predicated on the relatively high credit-card fees charged in America, which makes international expansion unlikely in the near future, says Mr Egerman. But there are plans afoot to roll out the app in other American cities.

A similar problem has put the brakes on overseas expansion for Angus Davis' Swipely, another payment service. He thinks that payment processing is a means to an end: his company distinguishes itself from the competition by providing restaurants—which make up around three-quarters of Swipely’s business—with in-depth analytics. It can tell participating restaurants, the average of which sells food worth $1m per year, which dish is the most popular, or which waiter's methods are the most conducive to sales. Swipely attracted $20m in funding in May.

Nearly $30m has been thrown at these three start-ups. Time will tell whether that cash could have been better invested in bionics: who knows how quickly waiters could see impatient diners with a pair of eyes in the back of their head? /economist