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PayPal steps up international mcommerce game via payment initiative

February 28, 2012

EBay’s PayPal is ramping up its mobile strategy to help European merchants and consumers pay for items via a partnership with carriers.

PayPal announced that it has begun working with European carrier 3UK to help standardize mobile payments at the Mobile World Congress in Barcelona, Spain. Under the partnership, all new 3UK, Android-based mobile devices will be preloaded with the eBay mobile application in addition to efforts that help online merchants mobilize their commerce programs.

“We are working to build a standard for carrier payments that benefits not only the carriers but also more merchants and consumers,” said David Marcus, vice president of mobile at PayPal, San Jose, CA, in a blog post.

“The initiative will require that carriers revise standards to help optimize user experience, increase flexibility of carrier payments as a payment method and increase payout rates for merchants, allowing carrier payments to address the entire digital goods industry,” he said.

Mobile ambitions
By preloading phones with the eBay app, PayPal is aiming to make it easier for online merchants to enable carrier-based payments for European online merchants.

Under the carrier partnership, PayPal will work with more than 250 carriers and 1,500 digital goods merchants to help merchants roll out mobile payment initiatives.

Mobile payments have been slow to catch on in the United States, but they are gaining traction in Europe and by helping to power transactions, PayPal hopes to educate consumers more.

To kick off the payment initiatives, PayPal has partnered with – Spain’s largest ticketing company – to let users buy tickets via their handsets. PayPal is also working with airport hotel brand Yotel to power mobile payments that will let consumers book stays on their mobile devices.

Streamlined payments
During the keynote speech at the Mobile World Congress in Barcelona, John Donahoe, eBay president/CEO, said that half of United States consumers use the Web to help them shop with mobile traffic playing an increasing role.

The executive also predicted that eBay is on track to reach $8 billion in mobile sales in 2012, which is an increase from the company’s $5 billion estimate for 2011.

Mr. Donahoe also confirmed that all 2,000 Home Depot retail locations will be equipped with PayPal’s mobile payment solution by the end of February.

PayPal began testing mobile payments in Home Depot stores in January (see story).

According to Mr. Donahoe, PayPal-powered mobile payments will be used by 10-15 different retailers by the end of 2012.

Additionally, the eBay iPhone app will be updated to let users calculate shipping costs, comparison shop and simplify the check-out process. The updated app will also connect with Twitter and include push notifications so that users can track their bids easier.

Over the past few months, PayPal has really been upping its mobile game.

In addition to rolling out the mobile payment initiatives at Home Depot, PayPal recently tested an NFC-based app in Sweden last year (see story).

PayPal is going head-to-head with other mobile payment solutions, including Google’s Google Wallet and MasterCard’s Mobile Money Partnership Program, which are also aimed at helping companies include mobile payments into their digital efforts.

As more options become available, retailers will begin to integrate more mobile payment choices for consumers, which is poised to help the mobile payment ecosystem gain traction.

“With this new initiative, carriers can expect to leverage PayPal’s expertise in mobile payments and digital goods, our vast network of merchant partners and our well-established back-end technology,” Mr. Marcus said in the blog post.

“Merchants will find more ways to monetize their users by offering additional frictionless payment methods,” he said.

Final Take
Lauren Johnson is editorial assistant on Mobile Commerce Daily, New York

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