PayByFace receives strategic investment from SafexPay, CEO discusses plans to go global
After being named as a participant in Mastercard’s Biometric Checkout Program, PayByFace announced a strategic investment from Indian fintech SafexPay to accelerate the growth of its face biometric payment solution and broaden its horizon to a global scale.
It is a culmination of a relationship that was built over a year ago, according to PayByFace CEO and founder Mike Draghici, who told Biometric Update in an interview that his company has, “a great synergy with the vision and mission of how their [SafexPay] executive leadership thinks and the future of payments.”
PayByFace offers a mobile app for biometric payments that links a user’s face biometric template to their digital wallet, which enables transactions with a scan of their face via camera installed on a smartphone or tablet. If implemented for an additional security layer, from there the user inputs their PIN for further verification of their identity, and if valid, processes the payment. It also secures the transaction with geofencing and liveness checks. Draghici also notes its security and data privacy features, backed by bank audits, vetting by Mastercard, and a full GDPR analysis of its internal workings that took almost a year to ensure security and compliance with technical standards.
Describing himself as a serial entrepreneur, Draghici started his business career with lemonade stands and mowing the lawns of neighbors as a child, before entering the software development field as a full-stack developer. After more than 20 combined years working for multinational companies and founding startups, he returned to his homeland of Romania, intrigued by the “wild, wild East.” Piqued by the time when he was only given the choice of cash or card when purchasing a coffee in Romania, his mind was drawn to the possibility of making purchases by just presenting a face. Having conceived of a biometric payment idea, he sold his sailboat and 40-acre property in Washington state with a winery (where he once planned to build a 3D-printed replica of Count Dracula’s castle) to start-up PayByFace in Romania.
Currently available in Bucharest, Romania in over 50 locations like salons and coffee shops, and Sophia, Bulgaria, PayByFace is joining an upswell of interest in contactless, biometric payments from players like PopID, NEC, Payface, and Fujitsu that Draghici says is “accelerating big time.”
In 2018, PayByFace focused on customer delivery and validation, only to be met with a pandemic-boosted demand for digital payments, e-commerce, and delivery services. “We happened to be at the right place at the right time,” say Draghici.
In the beginning of the pandemic, PayByFace was accepted into the Amsterdam Startupbootcamp to accelerate the project, and built prototypes in Bucharest coffee shops, where he proved PayByFace was technically possible. Now having to figure out a business model, the company took further steps like being accepted into the Visa Innovation Program in Bulgaria. The accelerator programs made PayByFace viable as a business, so in 2021, they further refined and stabilized the company’s core biometric payment checkout solution.
In 2022, the company focused on finding funding and a seed round. Having already built a connection with SafexPay because of their presence in Dubai and India for payment processing, Draghici and the PayByFace team travelled across India for four weeks to get a lay of the land and close their ties with SafexPay. He was impressed with India’s rapid pace of digital payments adoption, going from no QR code payments when he last visited five to six years ago to wide availability.
After finalizing the partnership in SafexPay’s headquarters in Mumbai, the company received a strategic investment and integrated its biometric payment solution into SafexPay. Ravi Gupta, Founder and CEO of SafexPay, says, “At SafexPay, we’re proud to integrate PayByFace with our comprehensive payments platform and wish to develop an India-focused contactless payment experience with the help of established payment networks and partners.”
Though unable to disclose the specific figure, Draghici says it will go towards sustaining and ramping up PayByFace’s presence in the Romanian and Bulgarian market, fund its product and engineering teams to keep up with the requirements from Mastercard for full security certification, updating the user interface for intuitiveness, rebranding the app, and assembling a full-time team for engineering in Bucharest. After singlehandedly writing six million lines of code over four years, Draghici wants to devote his energy to the business, not programming.
Besides the funding and integration into SafexPay, PayByFace will also run a pilot project in a large grocery store in India. Draghici says there are plans for pilots in Hyderabad, New Delhi, and possibly Mumbai. Then the company plans for a pilot in Dubai with a large retail chain. Draghici is confident that PayByFace can serve, “really large businesses up to the enterprise level. We’ve tested it long enough so we can play with the big boys.” There’s also demand for trials in California located within the Los Angeles and Malibu area; fast food joints in the Philippines; Puerto Rico; Greece; and London, England. In July, Draghici will also be visiting Johannesburg, South Africa, to oversee PayByFace’s first location in a coffee shop in the country. “We’re really picking up a lot of steam,” he remarks.
If there is any leftover investment, Draghici says it will likely go to turning over a profit. If there is traction with the business, he says PayByFace may invest in the U.S. market as the “last cherry on top.” The bonus is California, he says with a laugh.
Seeking to be a pioneer in biometric payments, Draghici says the Mastercard announcement poured more fuel on the fire to enhance customer experience and loyalty. “It seems like people are starting to get it,” he says of biometric payments’ viability and potential for disruption. He perceives biometrics as “a natural step” for many industries, and one that will “pick up steam, and we’re making it happen.”
“It’s about building a legacy and enhancing the customer experience and product. I want people to love this product. It’s a passion now,” he says.