| By Jim Bruene on October 26, 2010 6:47 PM | Comments (1) |
After seeing The Social Network and reading yet another post about the ramifications of Facebook's ubiquity, I sent this out via Twitter last week:
Today, the "PayPal dial-tone" got louder with the launch of a handful of new initiatives at the company's second annual developer's conference in San Francisco (which drew 2,500):
- PayPal for Digital Goods: Two-click checkout for low-value digital goods eliminates the hassle of logging in
- PayPal Embedded Payments: Pay without leaving the merchant's app
- PayPal Apps: Allows companies to embed applications into the PayPal website: Finovate alums Credit Karma, Expensify, and Bill.com are participating
- PayPal Business Payments: Electronic payments (non-credit card) of any size for just $0.50 per transaction
- PayPal Mobile enhancements:
-- Express Checkout provides similar two-click process
-- VeriFone integration
-- v3.0 iPhone app
Unless you are a developer, most of those programs mean little to you other than it's obvious that PayPal is really pushing on the gas right now. But the banking alliances revealed today are quite interesting, assuming they make it to market:
- USAA announced it will use PayPal to power peer-to-peer payments in 2011 (blog entry).
- Discover Card announced a similar service, called Money Messenger (press release). No word on when it will roll out.
I'm sure there will be much speculation on whether these powered-by-PayPal services will disrupt payments, or even catch on for that matter. But it's clear that PayPal has made important new alliances in the banking world. The dial-tone appears to be catching on, even with the establishment.
Update: More context on these announcements from Russ Jones, Glenbrook Partners, here.
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Great post Jim. Paypal has been doing some amazing things with the Paypal X program. Payment providers should be more than a little nervous when banks the size of USAA get involved, because more are sure to follow. Change is accelerating in this space more rapidly than most people imagined. Not only can you tweet money through services like TwitPay, use credits to make real purchases through Facebook, you can leverage PayPal X program to develop your own bill pay, online and mobile payment platform. Why use existing channels when you can potentially build your own? Look at a company like Venmo - you can now send money to a person or business simply through 'trusting' them. Interesting, enough so that it appeared in the New York Times this week. If application developers and FI's don't see the opportunities here, they should start thinking about what the payment space will look like in a few years. I would think about adding a paypal feed into my online/mobile banking and PFM systems, and offering text money movement...some very interesting stuff is about to happen (and that's without talking about Apple, Google, and traditional players like VISA and what they have in mind). Great time to be in financial services.