Square, Intuit, and Verifone are the big dogs in the mobile payment space right now, but if rumors are true, Internet payment giant PayPal may soon be joining the fray.
According to Gigaom, PayPay officials are preparing to announce a mobile payment solution for small businesses as early as this Thursday. The move would be part of a large brand refresh and would help PayPal bolster its efforts to get into brick-and-mortar stores with its payment systems. Already working with The Home Depot and some other retailers, PayPal sees getting into physical retail stores as critical to its future growth.
The mobile payments space is definitely a fast growing and intriguing business to be in. Square, an infant of a company itself, is reportedly processing more than $4 billion in credit card payments annually already. That’s a lot of income from processing fees and it obviously has PayPal salivating. While PayPal’s deals with companies like Home Depot will allow it to get into thousands of retail locations, the real money is with the tens of thousands of small business across the country, most of which only have one or two locations and are not using complicated point-of-sale systems to process transactions.
It will be interesting to see on Thursday what PayPal’s announcement involves and just how close to Square the service would be. Most agree that a large part of Square’s early victories in the mobile payment market have been the devices beautiful and simplistic form factor, its intuitive, easy to use, iOS and Android interfaces, and its ability to let small businesses deliver a more personal experience to customers by way of electronically delivered receipts. That said, some businesses see the 2.75 percent per swipe transaction fee as steep on Square, and if PayPal were to come in with a similar service and leverage its size to offer a lower fee to merchants, it could gain a foothold in the industry very quickly.