PayPal pushes for in-store transaction increase

Friday, August 31, 2012 - 11:09 by Graham Miller

While many people are talking about the growth of NFC (near field communication) for m-commerce style payments that are made at bricks and mortar outlets, online payment firm, PayPal, is talking up its own solution to the issue of how consumers should part with cash via their smartphones.

The PayPal application allows consumers to make payments in-store by generating a barcode, which can be scanned at the checkout and then allow the transfer of cash to the retailer in one swift move.

The main advantage which this has over NFC, is that there is no need for retailers to invest in new tills or terminals, just as it is not necessary for consumers to go out and specifically buy a smartphone with NFC built in; any modern device will do the job.

Security is assured as the app has a four digit PIN access code, which only the user will know, so the phone itself does not actually have any cash or financial information stored on it.

Millions of people already use PayPal when purchasing items via safe shopping online, so it has a strong brand image and also possesses the pulling power to help get its mobile offering into action at retailers across the UK.

Last year around $4 billion (£2.5 billion) was channelled through PayPal's m-commerce service and in 2012, it expects this to more than double to $10 billion (£6.3 billion) on a global scale.

Combining the common payment mechanisms of safe shopping online with the immediacy of the high street, is something that many retailers and payment firms are attempting to achieve.

Whether or not PayPal's method will win out and become the most commonly used mobile payment service, or whether the large investments being made in NFC will give it the lead, is not yet clear.