Credit card giant Visa has entered the micropayment processing space with payclick, a pre-paid hosted service aimed at teenagers purchasing online line content such as music and games.

Like PayPal, payclick is an online money repository that people can pay into with a bank account, credit card (Visa or MasterCard) or BPay and use the funds to purchase products online. No PayPal integration yet.

Developed in Australia, payclick is available for use from today and content online businesses including Telstra’s’ BigPond and Apple iTunes are offering the payment option.

According to analyst firm Investment Trends, the market for online micropayments where the transaction is less than $20 is about $646 million this year and will rise to more than $1 billion in 2012.

Payclick general manager, Greg Storey, said the service targets an un-met sector of the community and it has features to enable parents to control online payments made by their children.

People under 18 need to have their parent’s 'sponsor' their account, and money can be shared among family members only, not other payclick accounts.

Visa will do an integrated marketing campaign across online and cinemas to launch payclick.

On the merchant side, payclick does not require the e-commerce site to store any credit card details and although it is initially focused on digital content, Storey said the service can also be used for goods.

“The service is free for consumers and the merchant fees are competitive with other offerings,” Storey said.

Formerly the CIO of Pulse International, where he established a POS network, Storey has held positions at Visa and St George Bank.

Visa already has an extensive network of online payment gateway services – from e-commence sites and integrators to the banks themselves – and it considers payclick as a complementary service.

The amount of money held in a payclick account must be between $20 to $1000 and withdrawals to a bank account are not allowed. Payclick also supports recurring transactions.

Merchants can have their sales funds transferred into a bank account daily, weekly or monthly and an SDK is available for integrating payclick into an existing Web application.

Visa Asia Pacific general manager, Chris Clark, said with global e-commerce growing at more than 10 per cent a year, consumers are looking for more convenience when shopping online.

“Payclick can also be used alongside an existing payment gateway to give customers more options,” Clark said.

PCI compliance is not required for payclick as online sellers do not store the credit card details.