PayPal isn’t yet ready to say anything in public about what it might be planning in the mobile payments arena. But it isn't so clear that PayPal will want to wait too long for near field communications to achieve wider deployment before it tries to gain traction in some other way, especially ways that offer immediate scale.
That's the problem these days. Mobile payments ultimately will require huge scale. But few providers are able to demonstrate, today, such scale.
The contrast is Starbucks, which leveraged its existing terminals, existing loyalty programs, customer affinity for the brand and existing prepaid card infrastructure to create a program that creates instant scale for the brand, and doesn't try to create a ubiquitous, generic mobile payments business.
We might hear something in the fall. But there are clear reasons why PayPal is looking at mobile banking, mobile wallet and mobile payments in a general sense, and will emerge as a provider in some capacity.
The angle might build on PayPal’s strength as a trusted payment provider in the online marketplaces, as well as the advantages for international transactions. About half of online transactions use a credit card, while 22 percent use a debit card. But PayPal gets used 23 percent of the time, making PayPal as important an online payment mechanism as debit cards are.
So some of us would not be surprised to see some initiatives that build on the peer-to-peer payments business PayPal already runs. See https://personal.paypal.com/us/cgi-bin/?cmd=_render-content&content_ID=marketing_us/mobile_payments. From PayPal’s point of view, the service gets used both to buy things and send money to people. But retail transactions seem to hold potential that could vault PayPal into an entirely new segment of the payments market.
A new payments startup, Naratte, uses ultrasound to authenticate and transmit payment data. PayPal is reported to have looked at the approach.
The company’s founder, Brett Paulson, also has built a demo app specifically leveraging PayPal’s API that enables contactless “tap and go” transactions on almost any phone on the market today.
The payment technology, called “Zoosh,” establishes a secure link between payment source and merchant by generating a high-pitched sound which is inaudible for the human ear.
“All you need is a speaker and microphone, which you already have on your device,” says Paulson, Naratte’s chief executive and cofounder. “We’ve built everything in software so you just download an app to get a contactless experience.”
Laura Chambers, PayPal’s manager for mobile, also has been quoted in a statement saying that she and PayPal were “very excited about Naratte’s Zoosh technology” after seeing demos. “Zoosh’s approach provides instant scale,” she offered, “which is a major hurdle for most mobile payment technologies.”
The angle might build on PayPal’s strength as a trusted payment provider in the online marketplaces, as well as the advantages for international transactions. About half of online transactions use a credit card, while 22 percent use a debit card. But PayPal gets used 23 percent of the time, making PayPal as important an online payment mechanism as debit cards are.
So some of us would not be surprised to see some initiatives that build on the peer-to-peer payments business PayPal already runs. See https://personal.paypal.com/us/cgi-bin/?cmd=_render-content&content_ID=marketing_us/mobile_payments. From PayPal’s point of view, the service gets used both to buy things and send money to people. But retail transactions seem to hold potential that could vault PayPal into an entirely new segment of the payments market.
A new payments startup, Naratte, uses ultrasound to authenticate and transmit payment data. PayPal is reported to have looked at the approach.
The company’s founder, Brett Paulson, also has built a demo app specifically leveraging PayPal’s API that enables contactless “tap and go” transactions on almost any phone on the market today.
The payment technology, called “Zoosh,” establishes a secure link between payment source and merchant by generating a high-pitched sound which is inaudible for the human ear.
“All you need is a speaker and microphone, which you already have on your device,” says Paulson, Naratte’s chief executive and cofounder. “We’ve built everything in software so you just download an app to get a contactless experience.”
Laura Chambers, PayPal’s manager for mobile, also has been quoted in a statement saying that she and PayPal were “very excited about Naratte’s Zoosh technology” after seeing demos. “Zoosh’s approach provides instant scale,” she offered, “which is a major hurdle for most mobile payment technologies.”
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