PayPal, in conjunction with eBay, is preparing to move mobile and physical commerce systems into domestic stores on a much wider scale. In doing so, PayPal has been forced to begin testing contactless payments enabled by NFC (near field communication) swipe technology. PayPal previously acted as a bit of a damper on the capabilities of NFC in the mobile commerce system by proclaiming that it was interested in the technology, but believed it would take 3 to 5 years before it was ready for merchants and consumers. A new showroom recently opened in New York to demonstrate PayPal’s new multichannel commerce options to retailers. It has shown that there is a prime opportunity for a NFC ‘tap phone’ to support in-store payments (one that has been absent from previous showcases.
The showcase website explains, “PayPal isn’t committing to using NFC for payments yet, but it included it to show that it is prepared to enable those payments when the demand arrives.” According to Sam Shrauger, the VP of global products and design at PayPal, “If NFC gets to the point where retailers are adopting it at the point of sale and consumers are showing a propensity for using it, we will enable it, but we are not depending on it. There’s no timeframe for NFC, it just depends on the way the market moves. It could be next year or in five years.”
The New York showroom is designed to highlight the breadth of the PayPal solution and differentiate it from other NFC-based solutions, like Google Wallet, Isis, and Square. It will be open through February, and PayPal plans to start testing its new in-store platform with an unnamed major retailer before the end of 2011.
PayPal’s openness to adopting NFC in the future when the technology becomes a mainstay for consumers and retailers is a move in the right direction, especially with PayPal’s connection to X.commerce. We are excited for the future of X.commerce and look forward to integrating it’s capabilities with the amazing eCommerce websites we’re known for.
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