PayPal is Making Some Powerful Friends
The news out of eBay’s (NASDAQ:EBAY) PayPal surrounding its point-of-sale payment technologies just keeps getting better and better as it announces more and more avenues for the new technology.
Monday, PayPal announced the number of retailers that would offer its in-store payment service had reached twenty-three, with 12 of those 23 companies already accepting PayPal payments at about 18,000 brick-and-mortar stores throughout the United States. The variety of participating stores range from Foot Locker (NYSE:FL) and Abercrombie & Fitch (NYSE:ANF), to Guitar Center, to Toy “R” Us, to Spartan Stores (NASDAQ:SPTN) and Dollar General (NYSE:DG).
Tuesday, PayPal announced another partnership that could allow users to make payments from PayPal at another 60,000 locations. PayPal’s new buddy is NCR (NYSE:NCR), which makes point-of-sale technology and hardware and is working to integrate PayPal into several of its products. PayPal will also see functionality in some gas stations and convenience stores that use NCR’s technology…
Combining the number from NCR and from brick-and-motor retailers, PayPal should soon have at least 100,000 locations where users can pay in-store using their PayPal accounts. Square, one of PayPal’s competitors in the area of in-store payment technology, recently took a major step in boosting its presence by partnering with Starbucks (NASDAQ:SBUX) to serve all 7,000 U.S. locations. Square expects to reach 30,000 retail locations this month.
At a glance, Square would appear a strong competitor for PayPal in the field, especially if PayPal’s new partnership with NCR weren’t factored in. However, PayPal also partnered with Discover Financial Services (NYSE:DFS) last August and will start seeing its service offered in the 7.2 million merchant locations that accept Discover. With those numbers, PayPal will quickly best Square.
These partnerships don’t only mean big things for PayPal, as NCR and Discover could both expect to benefit from the billions of dollars in cash-flow. In 2012, PayPal forecast $10 billion in mobile payment volume, and with more locations accepting PayPal in the future, that cash flow can be expected to grow steadily.