Covering the Check - Mobile Payments at Restaurants in NYC
Tuesday, April 01, 2014
Posted by: Gloria Dawson
Imagine your customers finish a lovely meal and then get up without even asking for the bill. But you still get paid. That's the idea behind the new mobile payment app, Cover, which is already being used by top restaurants in NYC, including Resto, The Cannibal, City Crab, Pig and Khao, Alder, and others.
There's a lot of competition out there among apps that service diners and restaurants, but Cover co-founder Mark Egerman says his product can differentiate itself by seamlessly fitting into the lives of diners and the day-to-day of running a restaurant.
It takes about five minutes to set up, says Egerman. He's even worked with restaurants that were cash only. "We don't replace any systems and we can work with whatever set up a restaurant has," he said.
"There was really no setup, they came with an iPad already for us to use," said Peter Esmond, the director of operations at Rouge Tomate, where they recently started accepting Cover. "Mark walked me through using it, and I then showed the rest of the management team."
To get started, Cover needs a cancelled check from the restaurant. They direct deposit the next day, said Egerman.
"We found it to be a safer and more secure way to hold our house account information and was very simple and easy to setup," said Esmond.
Egerman got the idea for Cover when he was working with mobile payments at the Consumer Financial Protection Bureau. "I noticed that while banks were putting the squeeze on consumers they were also putting the squeeze on small businesses, specifically restaurants. Their credit card processing rate just skyrocketed in recent history," he said. "And considering the rates were going higher, and higher, and higher, we realized there was both a way to provide a better experience for consumers, modeled off Uber and more modern payment technology, and save restaurants money. We were able to undercut bank-processing rates."
Cover doesn't disclose the percentage it takes from each transaction to the public, but says its fees are lower than credit card fees.
Diners and restaurateurs alike appreciate the app because it removes "the most awkward part of the meal," said Egerman. Waiting for the check.
"Instead of saying let me bring you the bill. Let's settle up," said Egerman. "You can leave on a high note. And it turns out restaurants understand this vision very intuitively."
Another bonus: once the diner tells the restaurant they'll be paying with Cover, they can put their phone away. No need to check out or even look at the phone again.
Diners use a default tip percentage, but they are also able to change this each time they use Cover. "It's a true tip not a service charge," said Egerman. "Tipping is above board. It's exactly what the IRS wants tips to be."
Diners can use Cover at over 60 New York City-based restaurants in Manhattan and Brooklyn. They plan to stay local, expanding into the other boroughs soon, but the goal is to stay in New York and to really achieve a level of ubiquity here," said Egerman. "We want to be like American Express. When you walk into a nice restaurant and you sort of assume that they take Cover."