PayPal has announced the launch of its version of the now popular smartphone dongle that enables people to use their smartphones to accept card payments. The new dongle, dubbed PayPal Here is a triangular add-on that a user can plug into the earphone jack dock of a smartphone and then through an app download be able to swipe cards and accept card payments.
After swiping, the money becomes immediately available on the recipient’s PayPal account. PayPal, which was purchased by eBay some years back, has been ramping up its payment service as the amount of money it handles in transactions nears the $7 billion annually mark. The app, which will be free for download will offer users a number of easy payment features such as signing, tipping and having the payer decide whether they want the receipt emailed or sent to their phone via text.
PayPal Here will compete directly with payment startup Square which pioneered the dongle-payment technology and has reached close to $2 billion in payments processed annually. The company recently celebrated its 1 millionth business sign up and has over 100 million payers who have made payments through the platform. Other services that are competing in the same space include Intuit’s GoPayment and a similar service from VeriFone and startup SalesVu.
PayPal is a little late to the game as Square, which was started by Twitter co-founder Jack Dorsey, has been around since 2010 and it may be quite the uphill task to catch up. But PayPal may be banking on repurposing its existing PayPal merchants to adopt the new service as it pushes into the offline space where the bulk of payments take place. The service works with all major card processing companies including AMEX, VISA, MasterCard and Discover.