PayPal’s making bank cards obsolete says David Behrens.
THE biggest revolution to hit the checkout since chip-and-pin cards is rolling out across your local high street: it’s now possible to pay for goods and services with your phone instead of your wallet.
PayPal, the de facto standard for buying goods online, has moved from the virtual world into the real one, making available an app that aims to do away with traditional transactions.
The attraction to PayPal is obvious: it can charge commission on every sale, and it earns interest on your money while it’s in their hands. But what’s the advantage to you of using an intermediary such as this? After all, Google tried a similar initiative but met a wave of indifference from shoppers and shopkeepers alike.
PayPal has a head start, since many of us already have an account with them. And they’re upping the ante by plying buyers who opt to use their service with coupons and other money-off incentives. They’re also offering to sign up market traders, taxi drivers and others who previously took cash only and who will now be able to payments electronically.
But it’s convenience that will drive adoption by the rest of us – and this is where PayPal’s latest app comes into its own. At a restaurant, it lets you settle your bill without waiting for a waiter to hand it to you. And if you’re going Dutch, you can send or receive money just by typing in your companion’s email address.
You can also avoid the embarrassment of having to ask an eaterie whether it accepts cards because the app will tell you before you go inside. If it doesn’t, it will use your phone’s sat nav to find one that does.
The app also acts as a mini finance manager, letting you check the balances of your real-world bank accounts. Adding a new account is just a matter of taking a picture of your card with your phone.
All of which means that your wallet becomes less and less attractive – not least to pickpockets, who will, if you’re not careful, be able to deprive you of your phone and all your cash at one fell swoop. PayPal’s protection against this is the use of a PIN code, which you must enter for every transaction – so make sure you pick a good one.