YouTeller to Follow Gmail Model

YouTeller, a new online payment processor slated to open for business in March, will follow Google’s lead from when it started its popular e-mail service, Gmail.

Instead of simply opening the floodgates and allowing thousands upon thousands of signups, YouTeller will initially extend invitations to only one thousand customers who signed up during YouTeller’s pre-registration period. After this, only people who receive an invitation from a current customer may signup.

When Gmail first opened its virtual doors, a limited number of e-mail accounts were available. From there, in a sort of viral registration model, account holders could e-mail invites to their friends, allowing them to signup, as well. Nobody could signup without an invite after the initial batch of accounts were invited by Google.

YouTeller is doing this to make sure its servers can handle the customer load. “…our first priority [is] to provide our customers with a stable service and a reliable support," said Florian Schweitzer, spokesperson for Seed Capital, Ltd., the parent company of YouTeller. Registration will not be available to the general public “within the next few months.”

In addition to easing YouTeller into the high-demand online payment processor business, it feels that this invite system will also help track any potential money laundering, as customer links will be easily traceable. The company has said that it will cooperate with national and international institutions if it comes down to any investigations, but will not share customer information with anyone except court or governmental regulators, and only at the minimum required levels.

Unfortunately, since YouTeller is registered with the UK’s Financial Services Authority (FSA) as “Small E-Money Issuer,” accounts are only allowed to hold €150 and transactions are capped at €150. This potentially makes YouTeller useless to anyone except the smallest stakes poker players. The company has even said that, “Our target group are people who play community-orientated online games like poker, chess or role-playing games,” so registering with the FSA as an entity that has those kinds of restrictions is curious. On the other hand, YouTeller believes that the transaction limitations will make its service that much more unattractive to money launderers or other criminals.

Originally published 2:29 PM Friday, February 23, 2007