News

Texas company targets transaction processing in Mexico with proprietary wireless telecoms

April 14, 2003

SAN ANTONIO, Texas -- Wireless Access Inc., which deploys wireless networks in areas that do not have an adequate landline telecommunications infrastructure to process ATM and other card-based transactions, has received approval to expand into Mexico from PROSA, Mexico's leading bank network.

According to a report in the San Antonio Business Journal, Wireless Access spent 10 years developing its proprietary software and equipment for the financial services industry.

Now, Donald Rainwater, the company's president, said that Wireless Access wants to tap into the demand for card-based services in Mexico and elsewhere. Wireless Access will manufacture, market and service the equipment through its San Antonio office and affiliate offices in other countries, Rainwater said.

Wireless Access does not have any wireless operations in the United States, although it has had wireless networks in El Salvador for the last eight years and the Philippines for the last four to beta test the equipment, Rainwater told the Business Journal.

Following its certification by PROSA, which processes one-third of all credit card purchases in Mexico or as many as 700 million annually, Wireless Access has two pilot programs under way with the Mexican bank operations of Santander Serfin and Bansi SA in Mexico City.

If Wireless Access can prove the viability of the equipment, Rainwater expects the banks to offer his company's services to merchants in Mexico that currently cannot accept credit cards.

According to Rainwater, 20 percent of the world conducts 80 percent of all card-based transactions, indicating there is a huge underserved market. Wireless Access wants to fill that gap by expanding to politically stable, fairly sophisticated countries with strong business activity and disposable income -- like Mexico.

In many countries, Rainwater told the Business Journal, telephone companies still charge by the minute for phone traffic. Also, it is not uncommon in some parts of the world for merchants to have to call a bank to manually authenticate credit cards against a master list of stolen or invalid cards.

By utilizing Wireless Access' equipment, businesses can bypass local telephone networks by installing wireless relay boxes at the back of a store or restaurant to connect to a participating bank. A software program developed by the company allows banks to continuously monitor the networks for any downtime.

Rainwater, a real estate developer in San Antonio during the 1980s, came up with the idea for the technology during his travels. He's visited 43 countries, discovering first hand the difficulties of buying merchandise, particularly in Central America. Some shops accept credit cards, others don't. For the ones that accept cash only, an ATM may not be nearby.

He assembled a group of investors to incorporate Wireless Access in 1993. The company spent $10 million to develop its technology. After working in El Salvador, they approached Citibank NA, the world's largest credit card issuer. Citibank sent the company to the Philippines to set up a pilot program with its wireless platform. Following the pilot, Citibank certified Wireless Access there.

Wireless Access has 30 employees in San Antonio, the Philippines, El Salvador and now Mexico. "In the next 24 months, we'd like to have 10 countries," Rainwater said. "We're looking at revenues this year of $500,000. In the next 12 months, we're projecting revenues of $3 million."