Longtime Shareware Payments Processor Kagi Shuts Down

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After more than 20 years in operation, once popular software payments processor Kagi yesterday announced on its home page that it has shut down effectively immediately. Longtime Mac users are probably familiar with Kagi, which assisted numerous small developers in accepting credit card payments from users.

Kagi arose in the 1990s on the popularity of shareware, which allowed developers to widely distribute their software with time or feature limits as trial versions and then offer unlock codes for a fee to open up full functionality. Processing credit card payments for these unlock codes was difficult for small developers who didn't have the manpower or financial resources to handle payment issues or deal with setting up merchant accounts with credit card companies, and Kagi provided a solution for those developers by handling the payment processing, code distribution, and development and maintenance of store pages.

kagi_shutdown
With the evolution of payment processing in the form of PayPal and Stripe, Kagi's popularity waned, though it continued to be used by a number of small developers. Ultimately, however, that user base was not enough to sustain the service, with founder Kee Nethery also citing a decade-old case of supplier fraud that Kagi was never able to recover from as a major reason for finally closing down.

Based on the notice posted on Kagi's site and emails sent to developers using the service, a third-party company is "dividing up the Kagi assets and distributing them to the creditors," so it is possible some developers may not receive the full amount they are owed as Kagi shuts down.

Tag: Kagi

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55 months ago
Not familiar with this company. But reading this on their homepage peaked my interest:

"For the past ten years Kagi has been struggling to recover from financial losses due to a supplier fraud situation. We have reduced the debt but the recovery has failed and forced us to close.


We are sorry we failed you."


:(

Anybody have any information about what supplier fraud situation they're talking about? A Google search didn't seem to throw up much of an answer.
Score: 6 Votes (Like | Disagree)
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55 months ago
Wow. They've been around in shareware apps since the '90s. Remember having to use them for LOTs of shareware back in the OS 7, 8 and 9 days.
Score: 6 Votes (Like | Disagree)
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55 months ago
I blame Kanye.
Score: 6 Votes (Like | Disagree)
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55 months ago

Anybody have any information about what supplier fraud situation they're talking about? A Google search didn't seem to throw up much of an answer.

There should still be a Slashdot article about this fraud if you can access archives that far back.

What I remember is a supplier had a piece of shareware coded such that is was a Trojan running it's own, non-end user initiated, false purchases with fraudulent and stolen credit card numbers via the Kagi library linked in the app.

Kagi was caught holding the bag of liability to banks that paid out on the transaction. They could no go after the shareware supplier as they were in Asia and outside of extradition.
Score: 3 Votes (Like | Disagree)
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55 months ago
I gotta show my face here cause I mean, I got this username from a shareware game.

Wow. I remember that. Haven't read the word "shareware" in a decade or so. I am getting old I guess. :)

what you never see my posts?!?!?! :D
Score: 2 Votes (Like | Disagree)
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55 months ago
For anyone unfamiliar with Kagi: Back in the 1990s they were the payment processor for Mac shareware. If you ever bought any Mac software over the net at that time, you most likely dealt with them.
Score: 2 Votes (Like | Disagree)

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