Bwin's payment processor Kalixa to go it alone

The European online gambling group Bwin.Party Digital Entertainment is to spin off its payment platform Kalixa to enable the subsidiary to operate as an independent company, positioning it to better exploit the general and burgeoning e-commerce sector, reports the publication Tech Crunch.

Kalixa will shortly be launching new mobile and online wallet products to further its intended business model of being a one-stop shop for those seeking an e-commerce solution. The international e-commerce market passed sales of $1 trillion for the first time in 2012, and is projected to reach $1.3 trillion in 2013.

Tech Crunch reports that the separation will enable Bwin to focus on its online gambling ambitions, whilst Kalixa, which has been active for the past 12 years, will be able to distance itself from being solely an online gambling payments platform, empowering it to expand its client base and better compete against firms like PayPal, Amazon and Google.

In 2012 Kalixa processed Euro 2.7 billion in transactions for some 300 merchants; its pre-paid credit cards, backed by Mastercard, are in use by over 150,000 Europeans.

Kalixa CEO Ed Chandler told Tech Crunch: “Most merchants and consumers don’t know that up to ten different companies are involved in making or accepting a single payment, with each one taking a cut and expecting a return. This is adding unnecessary cost, complexity and risk to merchant and consumer payments.

“In times of austerity, businesses with shrinking margins and consumers with lighter wallets simply cannot go on paying over the odds. Kalixa is here to disrupt this scenario. We intend to trim the ‘fat’ by removing the excess links in the value chain to make payments simple and secure.”

Kamran Hedjri, Kalixa’s chief commercial officer, told TechCrunch that the company’s association with its online gambling parent had been from both a business source perspective, and for the experience that it had generated.

“Being connected to a regulated, online gambling company helped us develop a lot of benefits and particular skills in areas like fraud management. Now we show those in other sectors like travel how best to approach this.”

Hedjri said that Bwin has ploughed some Euro 100 million into developing Kalixa’s technology to date.