PayPal, which got its start online, is increasingly targeting the physical world by offering to collect payments for high-street stores. This week it announced deals with more than a dozen US retailers, plus VeriFone, Equinox, and Vend. These deals will extend its reach to shops both large and small in both the US and other countries.
The US deal announced yesterday (Thursday) covers Toys R Us, J C Penney, Barnes & Noble, Office Depot, American Eagle Outfitters, Abercrombie & Fitch, Rooms To Go, Jos A Bank, Aeropostale, Foot Locker, Nine West, Jamba Juice, Guitar Center, TigerDirect and Advance Auto Parts. PayPal said more announcements would follow this year.
Three of these chains -- Toys R Us, American Eagle and Jamba Juice -- had previously signed up for Google Wallet.
PayPal's system was already being used in thousands of Office Depot stores. In this case, customers pay for goods by entering their mobile phone number and a PIN (video below). They don't need to have their mobile phones with them.
Also, PayPal said that 300,000 small businesses had signed up for its smartphone-based PayPal Here payment service, launched in March in the USA, Canada, Hong Kong and Australia. Mobile phone payments have been common in Japan and some other places for a decade, but the idea has only recently made an impact in the US thanks mainly to a small start-up, Square.
Both VeriFone and Equinox run networks of payment terminals, and will be enabling retailers such as Toys R Us and Barnes & Noble to use PayPal. Vend, by contrast, provides a web-based service that has started to attract small businesses. Vend, which was founded in 2010, says it has more than 11,000 registered accounts in more than 80 countries, and already processes more than a million transactions a month.
With Vend and PayPal, customers "pay for goods and services by simply 'checking in' to the store on the PayPal app their smart phone".
Vend says its POS (point-of-sale) system enables retailers to process sales, track inventory, and manage customers on any device or platform that supports HTML5, including an Apple iPad. It also integrates with third-party offerings such as Shopify, Xero accounting and Perkville rewards.
PayPal, an eBay subsidiary since 2002, has been targeting this market for some time. In 2005, it bought VeriSign’s payment systems, including CyberCash and the Payflow Link and Payflow Pro payment gateways. In 2011, it bought Zong, which enabled payments via more than 250 mobile network operators in 21 languages and 45 countries.
The aim is to make the system ubiquitous, or at least to have all the major categories covered. Consumers are less likely to adopt a payment system that works in a single store, or even a major chain, than a system that works almost everywhere.
PayPal Here: How It Works http://www.youtube.com/watch?v=x5woIGSOLGk
Pay with PayPal at The Home Depot http://www.youtube.com/watch?v=Q8P9qT9EIVk