iKobo Review - Part 2
 by: Adam Senour

Attempt 1 Conclusion

On July 13, 2004, the transaction was cancelled. My MasterCard was never charged.

However, I did notice that my limits as a sender and receiver had been unilaterally raised to $500 USD. I had not contacted iKobo by telephone or email with regard to raising my limits, nor had I sent any of the "required" documentation.

It also appeared that Penny Wang was correct. MasterCard does appear to cause processing difficulties with the iKobo system.

Attempt 2 - Success in Sending Money via VISA

On July 13, 2004, I attempted to resend the $10 USD via iKobo using my VISA. The transaction went through successfully and on July 16, I received the small withdrawal amount on my VISA statement. I entered this amount in and the transaction was verified and the withdrawal amount refunded two days later. However, a loss of $0.23 occurred when iKobo refunded the money due to a change in the USD to CAD exchange rate.

My staff member received the I-Kard on July 23, 2004; 10 days after the transaction start date and 7 days after its approval.

No transactions have appeared from iKobo or any other retailers before or since the initial two attempts on either of my credit cards.

Support Email

I attempted to send the following email on July 8, 2004 to eohuche@ikobo.com, as well as support@ikobo.com:

To whom it may concern,

My name is (nom de plume), and I have been hired by ADAM Web Design to write feature articles for the articles section of the ADAM Web Design web site. This section may be found at www.adamwebdesign.com/articles .

I have become aware of iKobo recently and will be writing a feature article about your company, as it is one of the relative newcomers to the payment processing market. In the process of performing my research, I have uncovered some information and comments which I find rather concerning from the standpoint of the end user of your products. In the interest of fairness, I would like to give you the opportunity to state your side of the story to any readers of the ADAM Web Design website.

Please note that I will be publishing both this email and the response to it (or lack thereof) in the ADAM Web Design iKobo article, as a means of documenting my research on this subject. This article will be syndicated throughout various article publication websites and other channels of distribution. These channels of distribution can greatly benefit your company and provide it with some additional exposure, should my findings be favourable. Your response will be a factor in determining how favourable my review will become.

My questions are listed below:

The first testimonial on your website refers to a site (www.everythingforeveryone.com) that is under construction despite the following comments:

"Like every business person goes, I was in search of a reliable and easy-to-use merchant service. I traveled through each and every search engine to find the best merchant service that would use credit cards. The services I offer, paying online would make things go pretty fast. One fine day, after exhaustion, I found iKobo and it was my lucky day!! I registered right away and launched my site the very next day! Thanks iKobo for launching such a great, reliable and easy service."

Fatmah Azam Ali
Owner, www.everythingforeveryone.com

The website mentioned in the second testimonial (www.CyberSamrat.com) does not have any open mention of iKobo.

None of the other customers listed have websites using iKobo as well.

Do you have any merchant websites which openly use iKobo, so that I may question them about their experiences as I research this article?

In your Help section, there is an FAQ that reads as follows:

Q: What is iKobo?

A: iKobo is the fastest most convenient way to send and receive money world wide. You can send and receive money anytime in over 240 countries. Using iKobo you can send funds from your home or office, and your recipient can access the funds at over 800,000 ATMs worldwide using the iKobo i-Kard. Our Affiliate and Merchant programs are the best and most rewarding opportunities on the internet.

Since there aren't 240 countries in the world (not counting dependencies and territories), are dependencies and territories being included in this calculation?

Some countries, such as the country of Georgia, are able to send money but not receive it. Why is there a restriction on the receipt of funds?

Why would mailing an i-Kard be necessary, as opposed to email confirmation of payment similar to the way in which banks perform email money transfers? Does this not add unnecessary expenses to the service, thereby increasing its cost?

Why is information such as a credit card statement, utility bill, and/or birth certificate necessary for the raising of limits, and why do you offer the relatively non-secure method of email as a possible means of document delivery as opposed to a secure upload/download site?

What do people who don't have either a driver's license or a utility bill require in order to raise their limits?

What exactly does iKobo to manually validate information in order to raise a limit? And what do they do in areas where privacy acts may make it impossible to run a check on a driver's license?

What exactly does checking this information establish? All you can do with a driver's license in Ontario, for example, is check to see that it's valid. That doesn't necessarily imply that the person who owns it has never committed a fraudulent act. The same logic would apply with a utility bill.

There are many posts on various Internet-industry-related discussion boards that tend to arouse suspicion. A few such examples are below:

• www.kwcom.net/cgi-bin/forumtest/forum/forum_posts.asp?TID=228&
  get=last (all users)

• www.sitepoint.com/forums/showthread.php?t=158896&highlight=ikobo (Mike28)

• www.wholesale411.com/bbs/viewtopic.php?p=32940 (any pro-iKobo poster)

As you can see, all of these people either have relatively low discussion board post counts (one of the signs of a discussion board unsolicited commercial advertiser) or have affiliate hyperlinks (also a form of unsolicited commercial advertising). As a general observation, they also to come from areas outside of North America; a few of the more common countries for which positive testimonials are found are Romania, Pakistan and Russia. Why would there be little to no positive commentary from countries such as the US and Canada, if Canada and the US are two of the countries for which you claim are primary senders and the US is one of the countries which you claim are primary receivers?

Another rather common issue that comes up is that of iKobo's IPN/anti-fraud. Many developers are claiming to develop their own set of filters based on your IPN, yet I fail to see how this would be possible or necessary if your anti-fraud mechanism is accurate enough to capture the vast majority of fraudulent transactions. Could you please elaborate on this issue and explain in practical language exactly how this would work?

Do you communicate with bank servers via Base24 or the newer and more secure Base72?

Thank you very much for your time, and I look forward to your response.

A few notes on this email for clarification:

1. Base24 does exist. It is the central banking network through which all electronic transactions, online or offline, are posted. However, Base72 does not. I included a reference to Base72 in an attempt to determine their honesty.

2. I have removed my nom de plume for the purposes of being able to reuse said name for future research.

The Interlude

My attempt to send an email to the email addresses above failed. The eohuche@ikobo.com was returned by MAILER-DAEMON with the error message "user unknown" and support@ikobo.com is configured as an autoresponder, encouraging the user to contact iKobo directly via their trouble ticket system.

The eohuche@ikobo.com email was particularly unusual for two reasons:

1. The email is listed as the administrative and technical contact email for the iKobo.net domain name (see Discrepancies section).

2. Emeka Ohuche is listed on the iKobo website as the president and CEO. One would think that the president and CEO, especially when listed as the administrative and technical contact for a domain name, would have a working and valid email address.

Upon receiving the instructions from support@ikobo.com to use the trouble ticket system, I did so the following day (July 9, 2004). I received a polite response from "Stewart Langille" who indicated that he would be more than happy to discuss these issues with me via telephone. However, I declined this option on the grounds that I wanted to be able to provide the iKobo email response to my article readers.

The iKobo Response - 13 Days Later

On July 21, 2004, I finally received a reply from iKobo. However, I did not receive a reply from "Stewart Langille"; the reply came from donotreply@ikobo.net.

The reply follows, in its entirety (including the indentation):

Please find the answer to your request below:

www.everythingforeveryone.com is a former featured merchant. This information will be updated with our next release. www.CyberSamrat.com has a large iKobo banner toward the bottom of the page. We have many customers that sell on auction sites. Many online merchants do not show you upfront and in living color the name of their payment processor, because they want the customer to focus on the information on the site itself.

The discrepancy in the number of countries is simple. While you are absolute correct that there aren't 240 countries in the world. This refers to the ability of sending and receiving money, as not all the countries can receive money and not all the countries can send money. This number is not limited to countries only as it also includes dependencies and territories, as you pointed out. This number has been corrected on our site to reflect correctly that we deal with 170 countries worldwide.

The way ikobo works is that we charge the sender's credit card, we then make this money available to be withdrawn using an iKard (currently this is the only way the money becomes available). We do not deposit money directly into anyone's bank account. We offer email as a means to submit information because it is convenient. We do not have a secure upload/download site that we can offer (at least not yet).

We ask for certain information pertaining to an account holder as it pertains to increasing the limits, because this helps our Verification Department maintain a good level of security, this also helps keep fraud down. We have to not only protect ourselves as a company but also our customers. People are not limited to just a driver's license and a household bill in order to have their limits increased. There are several different documents they can submit to request a limit increase.

The reason we ask for these documents is not because it tells us specific information about the customer. We use these documents to help verify their information. As far as what exactly we do in order to verify information and how we keep fraud down is not information we share. The reason being security, for both iKobo and our customers.

Studies have shown that when people are happy with a service they tend not to share the experience. Which means that very few people actually share their positive experiences. However, there are people in countries that other payment processing companies do not service, that are happy and willing to share their positive experiences about a company that does provide service to them.

IPN is not an anti-fraud device; it is designed to provide our merchants an Instant Payment Notification (IPN). This was designed with security of the customers' information in mind. I cannot comment on what developers not associated with iKobo claim to do or be able to do.

We do not share our bank partners' information. I cannot elaborate on our processes because it is privileged information.

Click here to respond to this email. (do not use the reply function on your email browser)

Thank you for choosing iKobo,

The iKobo Team
iKobo, Inc.
iKobo, Inc.
Customer Support Department

IKobo Service Positive Aspects

1. The I-Kard showed up at my staff member's house within the allotted time frame (3-5 business days).

2. The daily reminders to input the verification amount were very helpful.

3. "Penny Wang" (the Live Chat representative) seemed to take an interest in what I was asking, although this is somewhat difficult to judge from behind a computer monitor.

4. The VISA verification was relatively quick (two business days).

5. My limit was raised to $500 with no additional verification required.

iKobo Service Negative Aspects

1. A 13-day response time for a support email, no matter the complexity of said email, is excessive.

2. MasterCard poses problems for the iKobo system.

3. No debit card or bank information is accepted.

4. The signup process was somewhat confusing, with multiple steps being required where one would suffice.

5. The "Forgotten Password" link does not function as intended. No password gets sent to the requestor's email.

6. Because of the I-Kard concept, an additional $1.50 per transaction USD ($.95 within the US) is added to the overall cost. This renders the iKobo fees higher than the PayPal alternative. This brought the total fees for the $10 USD transaction to $3.50 ($2.00 for the transaction, and $1.50 for the I-Kard).

7. No satisfactory explanation was offered for the rationale behind the request for additional information.

8. My limit was raised to $500 with no additional verification required. I have placed this as both a positive and negative since, while I do appreciate the right to send and receive additional funds, it directly contradicts the iKobo request for additional information.

9. The company is based in Marietta, Georgia, yet the employees seem to have major problems with the grammatical aspects of the English language. There are numerous typographical and grammatical errors both on the iKobo website and in communication with employees.

10. The coding of the iKobo website contained numerous technical errors and relied excessively on JavaScript, which is disabled in over 13% of web browsers. For a company that seems to target a global audience, this is a rather abnormal strategy at best.

Informational Discrepancies

1. iKobo.com and iKobo.net, despite appearing to be websites for the same company, are two different websites with two different sets of domain information.

Due to legal restrictions with regard to the publication of WHOIS information, I cannot reveal the results of the domain name WHOIS lookups for both companies: however, for those of you who are curious, a website such as www.domainsearch.com will allow you to verify this information.

2. iKobo claims to accept MasterCard, yet MasterCard posed difficulties for iKobo during my initial transaction.

3. iKobo's head offices appear to be in Marietta, Georgia, with no listing of offices outside of this area. However, they charge $9.95 USD for express delivery of the I-Kards to Canada and the US, while issuing said cards for free to countries such as Andorra, Spain and Belgium. This would suggest that iKobo is targeting the European market and/or not entirely based in the United States.

4. Cybersamrat.com did not have a banner promoting iKobo services on either the day I had sent the email or one week later, when I reviewed this particular site.

It should also be noted that cybersamrat.com sells web design services and, as such, would not be especially likely to have the iKobo banner up strictly for the purposes of informing customers that iKobo can be accepted. The affiliate code contained within the cybersamrat.com banner also indicates other purposes.

5. While many online merchants do not reveal their payment partner info, a large percentage of others do in order to let their customers know that their online purchases are made in a safe and secure manner. To date, I have not yet seen an iKobo merchant website other than cybersamrat.com.

Final Analysis and Conclusion

iKobo does not appear to be a scam, as many have suggested. However, it is a company with a number of technical and support problems and needs to do a great deal more to both expand its service offering and lower its fees.

iKobo also needs to be more upfront in terms of disclosure, in order to ensure that its users have the full benefit of knowing what is being done with their information and whom it may be directed toward. Another recommendation would be to include opt-out information directly on the initial signup form, rather than forcing users to click on a subtle hyperlink that many people would not see.

It does not, at the present time, pose a serious threat to PayPal in the marketplace; however, if they can improve on the issues mentioned above, this may change in the future. If this does change, an updated review will be posted accordingly.