PayPal, the e-commerce payment provider run by eBay, is very familiar to online shoppers, with over 100 million consumers using it to transfer funds to purchase things over the Internet. The company is now expanding to handle offline purchases as well, which could ultimately make PayPay a rival for big payment processors such as American Express, Visa and MasterCard.
PayPal plans to partner up with point-of-sale software provider ABJ software and intends to hold trials with over 20 retailers before 2012 comes to a close. eBay forecasts that the in-store PayPal payment option will be profitable within five years.
For starters, eBay is launching a trial in 51 Home Depot Stores, the majority of which are located in or around the San Francisco area. Customers with Pay Pal accounts will be able to use it make in-store purchases at participating Home Depots as soon as March. Consumers will be able to pay via PayPal at checkout stations within Home Depot or at self-checkout kiosks either by swiping a PayPal card and punching in their PIN number or using a telephone number and a pass code.
“We believe PayPal`s solution has the potential to improve the checkout experience as we know it today by making it fast, secure and more convenient for the customer while providing savings for Home Depot,” said Home Depot`s treasurer and vice president of financial services Dwaine Kimmet, according to Reuters.
PayPal pitched their in-store payments system to nearly 120 different retailers in September at a Los Angeles event. The country`s second-largest office supply retail chain Office Depot is also participating is testing.
“It`s at this point in a small number of stores … because there are still some rough spots in that experience. There are some limitations on who can use it, service carriers that support that,” said the president of Office Depot’s North American unit Kevin Peters, as reported by Reuters.
“At this point, we are walking very, very slowly. The last thing we want to do is to roll out technology that doesn`t appreciably change the customer experience,” said Peters.
The motivation for Home Depot, Office Depot and other retailers to get on board is revenue – PayPal transactions cost them less in fees than purchases made by either debit or credit card.
According to data released by PayPal, they added a million new accounts each month throughout 2011 and now boasts 106.3 million registered accounts that are active.