PayPal Preps ‘Hands-Free’ Payments; Apple Debuts Fingerprint Security (Sept. 10, 2013)
PayPal could give mobile commerce a big boost with the introduction of PayPal Beacon, a service it’s piloting this fall that will enable customers who opt in to pay “hands-free” with their PayPal mobile apps at participating merchants. The move comes on the heels of PayPal’s expanded acceptance at brick-and-mortar stores, along with its recently updated mobile app. PayPal Beacon is a small, triangular-shaped hardware device that plugs in to any power source enabling merchants to send out a low-energy signal via Bluetooth to anyone with PayPal’s mobile app. Any store running PayPal-compatible POS systems, including PayPal Here, NCR, MICROS and others, can integrate the service with PayPal Beacon, and PayPal users can opt in for the app to make certain payments automatically, David Marcus, PayPal’s president, wrote in a blog post.
When a customer with PayPal’s mobile app who’s also opted in to PayPal’s check-in feature enters a store, PayPal Beacon triggers a merchant notification of the customer’s presence (which can include a participating customer’s photo). Beacon also sends a signal to the customer’s device, which could be an announcement of food or prescriptions ready for pickup, available discounts or deals, or other product news. “This technology is our most significant contribution to date in reinventing the in-store shopping experience,” Marcus added, noting that a full rollout is expected early next year.
In other news that could affect mobile payments adoption, Apple Inc. today announced its latest technology, which did not include NFC payments. Apple unveiled the iPhone 5S, which will include Touch ID, a new fingerprint-based security technology. Apple’s Touch ID unlocks a phone’s screen and it also can be used to make iTunes purchases, bypassing the need to input passwords. Touch ID is the result of Apple’s 2012 purchase of AuthenTec Inc., and some observers say that fingerprint ID could be a step toward authenticating POS payments, if integrated with some of Apple’s numerous patents and innovations, including Passbook.
“Fingerprint [security] could mean a huge amount in the payments world,” Rick Oglesby, a senior analyst with Aite Group, tells Paybefore. “It has the potential to make cloud-based digital wallets as secure or more secure than a card-present transaction,” he notes, adding that such innovations are dependent upon developer, industry and consumer adoption.