AOL founder launches Internet credit card

Steve Case, the co-founder of AOL, has joined with other industry leaders to launch an innovative online credit card company.

The company, Revolution Money, is a subsidiary of Case’s investment company, Revolution LLC.

Revolution Money has launched two products, Revolution MoneyExchange which is a money transfer service for online transactions, similar to PayPal; and RevolutionCard, a credit card protected with PIN-based encrypted technology.

RevolutionCard, which is available now, does not display the user’s name or account number on the card, to help avoid identity theft.

Revolution MoneyExchange, available by invitation only, will be offered to all consumers later in 2007. It is being promoted as “the first online payments platform for social and instant messaging networks, allowing consumers to safely transfer funds via the Internet to anyone, even merchants, for free.”

Revolution Money has partnered with First Banks Inc., Citigroup Inc., CompuCredit Corp and Union State Bank to launch the new services.

Revolution Money offers competitive charges, which could reduce merchant’s fees by around 75%.

While traditional credit card companies charge an average of 1.9% of a consumer’s total sale, Revolution Money charges merchants just 0.5%.

The company is able to offer low fees because its system utilises cost-effective Web 2.0 technology.