PayPal embraces NFC with app update and Vodafone wallet partnership

PayPal has changed its anti-NFC stance, and is set to support the contactless payment technology in its app.

The payment technology firm has also teamed up with Vodafone in a move that will enable the networks mobile wallet customers to make NFC payments.

The PayPal app update will take effect in the US and Australia in Q2, while the Vodafone Wallet PayPal update will take effect in Europe, starting in Spain this week.

PayPal execs have historically been publicly scathing of the usefulness of NFC, with eBay CEO John Donahoe stating in 2013 that NFC stood for “Not For Commerce”.

Since then, however, the payment technology has gained some traction in the smartphone marketplace, with Apple (another company to previously shun NFC), Google and Samsung all making moves towards NFC payments.

Strategically, PayPals embracing of NFC gives it an avenue into in-store payments, which has so far been its area of weakness.

Forrester analyst Jacob Morgan says that PayPals move towards NFC furthers the firms stated goal of becoming the “operating system of commerce”.

“The partnerships will give PayPal direct access to substantial groups of new customers who are already familiar with moving money electronically,” he says. “Placing consumer convenience and ease of merchant integration towards the centre of their strategy moves PayPal forward towards their goal to become an alternative network, an alternative choice to the big card players.”

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