Spotlight: PayPal Here mPOS Card Reader

Paypal here snipPayPal has never sold its own hardware before, so the Here team has spent the last 18 months making sure that its mPOS reader meets both consumer and merchant expectations.

“Who’d have thought PayPal would be shipping hardware?” said Narik Patel, business development manager. “But PayPal gave consumers the confidence to shop online and we will give them the confidence to use mobile point-of-sale. People know and trust the brand, which means there’s an instant trust transfer to the seller.”

Using the £99 device, it’s clear to see that his team has put a lot of effort into the UX of the app and design of the hardware. The box is not unlike an Apple product, the literature contains just five instructions and contains two stickers for merchants to use to indicate that they accept PayPal payments. “We don’t make money on the reader and we don’t plan to make money on it,” Patel said. The company has settled on a pay-as-you-go transaction model, with a flat-rate charge for each sale of 2.75 per cent.

The Here device has been stripped down to remove the typical mPOS printer and screen – areas that drain battery or are most likely to get damaged – but PayPal is selectively approving partners to offer these products. They could ultimately end up with a box that comes with everything.

Paypal receiptHow does it work?
After registering for a PayPal business account and using the app to login, the process of deciding how you want to list your stock, including taking quick pictures, and what tax or tips to charge takes a matter of seconds. Within the app, there is a short tutorial and a video about pairing the devices via bluetooth. There is also a UK phone number inside the app for users to call if they are having trouble.

Although it took some time to link my iPhone to the card reader – about an hour later – and I’d made my first successful Chip & PIN sale. I then sent a receipt direct to my customer’s handset via SMS. Merchants can also scan the barcodes on products using the phones camera, register cash and cheque payments, access their sales history and see a daily summary of transactions.

Where can you get it?
The company has transformed an old ice cream truck into the PayPal Here Van and has spent the last month hitting up trade shows and farmers markets around the UK. “We’re selling the devices in person and using the Here device itself to make those sales,” Patel said. “It’s about branding and changing perceptions – my team is in that van – so were not just a faceless organisation.”

A partnership with Apple means merchants can also go directly into one of its stores to buy and set up with PayPal Here – or you can order the device within the app itself. The company is already live with 50 retailers, including Green Tomato cars, which has a multi-user account where its drivers have their access limited to taking payments, rather than moving money.

“It costs less than £100 for a payment product that can follow you for life,” Patel said. “You can lend it, share it, approve payments in real-time and get immediate access to funds and transfer them off to your bank account. A plumber now has access to as much technology and marketing materials as Tesco.”

What does the future hold?
The company’s photo check-in function is built in to the Here merchant app and PayPal predicts that by 2016 you won’t need a bank card to shop on the British high street. So how do they get people to use check in? “Were looking at how merchants can use order ahead, offers, promotions and loyalty. Today they can create closed-loop offers where they can give discounts.” An SDK is also on the way so merchants can embed the PayPal Here infrastructure into another platform. The company is also consolidating a somewhat confusing array of consumer-facing apps into the core PayPal app.

“There is a huge change underway at PayPal,” Patel said. “We accept that were guilty of a lack of innovation. But with things like being able to phone customer services direct from the app and the PayPal Here Van, we’re addressing that. In an increasingly competitive market we have got to do a great job to stay on top.”