Pay With PayPal At Places Where Discover Is Accepted
Those who remained unmoved by PayPal’s recent changes this year sat up and took notice of PayPal’s latest announcement. PayPal plans to partner with Discover, yes, financial services provide Discover, to facilitate consumer purchases at retails locations across the United States. This is PayPal’s first move to penetrate the offline market and get their share of the billions of dollars in sales that take place at local cash registers.
According to a PayPal representative this move is all about removing customer limitations when making purchases offline and providing customers with even more possibilities. This announcement had an immediate impact on the shares of both Discover and eBay (the parent company of PayPal) sending them to record breaking highs.
The rollout of the product of this unexpected partnership is carded for next spring. Once in effect 50 million PayPal users will be able to pay with PayPal at retailers that accept Discover. That means they will have over seven million retail locations for PayPal transfers. Of course Discover is not as widely used and accepted as industry giants Visa, MasterCard and American Express but according to reports they have a 95% penetration rate in the U.S.
Neither consumers nor merchants will be expected to purchase any hardware to facilitate the transactions. PayPal users will need to use their cell phone number along with a pin for security. When making a purchase the number and pin will initiate the payment through their digital wallet once verified. Users will also be able to use their new PayPal cards to make payments, track loyalty points, promotions and coupons. The new cards come with a Discover Issuer Identification Number, IIN, which will identify each user. The IINs for PayPal users has already been set up by the Discover Network.
Although retailers won’t need to purchase new equipment they will be charged a fee for every transaction where users pay with the new cards. PayPal will then use this to pay Discover for allowing access to their network. Details of the fees have not been publicized.
On the surface this might not look like a win-win agreement but it is. Discover is especially excited about the partnership because they believe that it is a move that will help them close the gap between their company and other giants like Visa and MasterCard. Merchants will now be more willing to accept payments from the Discover Network and they expect to bring in significant volume once the service gets underway.
So far the news has been greeted with good reviews. Consumers are excited with this new turn of events. PayPal this year has been expanding their products to fully meet the needs of their customers. From a new and improved and very intuitive website design and layout to the introduction of PayPal Here the company has really been stepping up their game to meet the demands of a technologically minded market.