Imagine walking into a store you’ve never been to before, having a salesperson greet you by name, and then making a purchase without pulling out your wallet. PayPal’s new Beacon device aims to make that scenario a reality, giving people a personalized, hands-free payment option.
Beacon is a piece of hardware that allows merchants to provide contactless payments to customers who have downloaded the PayPal app to their mobile device and enabled the app’s hands-free check-in option. The pilot program will begin later year, and a rollout is anticipated in early 2014.
Beacon runs on a Bluetooth Low Energy (BLE) signal. It allows devices to connect with each other without Wi-Fi or GPS being turned on—even without a phone signal. Merchants must run a compatible point-of-sale (POS) system to use Beacon. Current POS systems that support Beacon are Booker, Erply, Leaf, Leapset, Micros, NCR, PayPal Here, Revel, ShopKeep, TouchBistro and Vend.
David Markus, president of PayPal, said the company wanted to create a way for customers to pay without doing anything. “Just walk into a store, and, like magic, when you’re ready to pay, money is transferred securely,” he said.
Beacon lets merchants provide their customers with a personalized experience. If a shopper comes in and has enabled the check-in option, their photo will pop up on the merchant’s POS system, allowing them to be greeted by name.
Using Beacon, shopkeepers can place orders for regular customers when they see them walking in the door. A verbal agreement is all that’s needed in order for a transaction to be made, and a receipt is emailed to the customer. For this to work, of course, the customer must have their smartphone or mobile device with them and have Bluetooth capability turned on—as well as having the PayPal app enabled for hands-free payments at that location.
PayPal addresses concerns about privacy and security by assuring people that they will not track users’ locations, and that if users decline the check-in option or ignore a prompt from their PayPal app, no data will be transmitted to either the merchant or to PayPal. Users can enable check-in for certain stores and not others, and there is a separate option to enable hands-free payments, giving customers control over which merchants can use Beacon to charge them.