Of the nine startups flaunting their stuff to investors, hedge funds, high-net-worth investors and other attendees at Landmark’s digital media forum last week, one company took aim at mobile payments.

Moocho.com, like the flood of other mobile payment players, turns smartphones into wallets. What distinguishes the California-based startup from the pack of others is the way in which it is entering the space. It’s only gunning for users among college students.

The closed-loop application works like this: A college student downloads the app and plugs in his credit card or debit card so that he can make payments at participating merchants with his phone.

To foster the payment behavior, Moocho incentivizes usage through instant rewards and loyalty rewards — a functionality that is inline with what others, like PayPal and Google, are doing. However, Moocho offers students an added delicious feature: users can charge food and grocery transactions to mom and dad, if the parents agree to connect their cards as well. Moocho says valid purchases are automatically sent to the parents, while other charges are automatically billed to the student’s card.

The appeal of honing in on college students is twofold: 75% of students have a smartphone; and by 2014, 90% will have such a device, said Levenson; and college is “a hyper local marketplace.” He told attendees that the average student spends $3,000 a year.

What troubled me from the demo is when Levenson revealed the merchant transaction fee of 10%. That’s a lot. An attendee in the audience vocalized my concern by asking the presenter: “Why will merchants play a 10% transaction fee in addition to the interchange fees that they already bitch and moan about?”

The founder, though, seemed untroubled, adding that he hasn’t run into any resistance as of yet. Moocho has already launched on seven campuses and inked deals with 250 merchants. The company has a database of 60,000 students.