PayPal wants to partner with Apple in mobile payments, sources say

“Apple may finally appear serious about facilitating the purchase of physical products in retail stores through its devices — and that has gotten the attention of at least one potential major competitor,” Jason Del Rey reports for Re/code.

“Three payments industry executives tell Re/code that eBay-owned PayPal has been pitching Apple on helping the consumer electronics maker bring its long-rumored payments initiative to fruition,” Del Rey reports. “These people, who have spoken to contacts at both Apple and PayPal, say that PayPal is essentially willing to white-label parts of its payment service to be used in an Apple mobile payments system — anything from fraud detection to back-end infrastructure, even possibly down to the processing of payments. ‘They’re telling them, ‘We’ll do it in the background,’ one of these people said. ‘Basically, it’s just, ‘We want to be a part of this.””

“Two of these people said it’s unlikely Apple would find any need to link up with PayPal, though they would not rule out the possibility,” Del Ray reports. “This could be a scary proposition for PayPal if it doesn’t figure out a way to partner with Apple.”

Read more in the full article here.

MacDailyNews Take: Mikey Dell really wanted to license OS X from Apple. Didn’t mean he got a deal.

[Thanks to MacDailyNews Reader “Dan K.” for the heads up.]

Related articles:
iWallet: Apple exploring expansion of mobile payments, sources say – January 25, 2014
Apple patent application reveals secure iWallet system with iBeacon – January 16, 2014
Apple’s revolutionary iWallet is coming – December 10, 2013
Apple could have 250 million iBeacon-capable units in the wild by 2014 – December 7, 2013
Apple turns on iBeacon to guide shoppers at 254 U.S. retail stores – December 6, 2013
Analyst: Apple to reach 600 million users with credit card accounts on file by year end – June 4, 2013

26 Comments

  1. All paypal does is protect you from having to give out your card details to multiple retailers, and save you from having to have all those details hand at all times. In very broad strokes, Apple just needs to add multiple payment methods and get people to accept payments from them and they’re done.

    1. “Apple just needs to add multiple payment methods”

      This is something they can’t do. All Apple is authorized to do is accept payment in the form of CC.

      Apple is many things but they’re not stupid. Why reinvent the wheel when there is a company out there who specializes in myriad forms of payment, money orders, and wire transfers.

      In time, as the details of this relationship are uncovered, it will be Apple extolling the virtues of PayPal and what it means to you.

        1. It would seem you are not familiar with the complexity of the banking systems of the world. eBay knows what they are doing, and Apple has little experience nor in-depth knowledge of the complicated legal landscape of banks. Apple only knows the retail end of things. It would be a waste of time for Apple to divert its attention to becoming a new bank.

          For a worldwide secure payment system that offers users true flexibility, Apple needs Paypal (and other internet banks like Ally) as much or more than PayPal needs Apple.

          The industrry that is ready for Apple to revolutionize is credit cards. It’s about time that the insecurity and customer-unfriendly practices of that industry died a spectacular death. We’re waiting, Cook!!!!

        2. “Oh, and it’s not possible to ever be authorized for anything else?”

          Not unless Apple finds a US bank willing to process all of their PayPal-like transactions for it’s 400-million accounts.

          Apple is not stupid, but their iBeacon is woefully lacking without a bank to process purchases. Sure they can continue using VISA/MC, but Apple is paying a 4.6 percent processing fee for each transaction, where as PayPal charges only 1.9 percent for merchant services.

          Having a bank is what it’s going to take for Apple to complete the iWallet service. If they go forward without PayPal they can always turn to the PP’s competitors:

          All of these companies offer online financial services, so Apple has lot’s to choose from.

          Adyen
          Alipay
          Amazon Payments
          AsiaPay
          Authorize.Net
          Balanced
          BIPS
          BPAY
          Braintree
          Chargify
          Citibank
          ClickandBuy
          CreditCall
          CyberSource
          DataCash
          DigiCash
          Dwolla
          ecoPayz
          Edy
          Elavon
          eWAY the UK
          Flooz
          Fortumo
          Google
          HSBC
          iKobo
          IP Payments
          iZettle
          Klarna
          Live Gamer
          Mobilpenge
          ModusLink
          MPP Global Solutions
          Neteller
          Nochex
          Ogone
          Paymate
          Payoneer
          PayPal
          PayPoint
          Paysafecard
          PayXpert
          Payza
          Peppercoin
          Playspan
          Popmoney
          Realex Payments
          Recurly
          Sage Group Sage Pay
          Skrill (Moneybookers)
          Square, Inc.
          Stripe
          TFI Markets
          TIMWE
          Ukash
          UseMyServices
          VeriFone
          Vindicia
          WebMoney
          WePay
          Western Union
          Wirecard
          WorldPay

        1. This isn’t just about Apple taking your money for your iTunes purchases, this is about our being able to spend our money in ANY store using iBeacon, where the money is withdrawn from my chosen online bank account, whether it be PayPal or Dwolla, or Bank of America, using any iDevice.

          Until then, Apple and I are stuck with Credit/Debit cards. In other words, Apple wants permission to withdraw money from my personal account, instead of using proxies like CC companies.

  2. Apple could buy PayPal, but then they’d probably lose a partner in Elon Musk.

    PayPal provides merchant services to more than 9,000 online retailers in more than 190 markets and holds 230-million accounts. Those accounts are protected by a fraud management service second to none.

    Apple’s partnership with Paypal would provide Apple consumers the ability to pay for products and services using other forms of financial transactions, besides credit cards.

    I would eagerly welcome PayPay to the Apple ecosystem.

    1. Those are exactly the things I like about PayPal, and the things I would like to see Apple have in place. I would hope they could do it without becoming involved in PP, though. They buy such systems, but usually when they are just getting off the ground and are “affordable”. I doubt that would be the case in buying PP. Partnering with, though, I could see.

    2. Or show the talking heads what you can do with billions in cash. Buy them! And then do something with it soon. Then, do more. And do that other thing too.

      Tim and the board, you all need to learn to chew gum and walk at the same time. You are killing the investors. We are hoping that AAPL becomes dead money instead of bleeding money out of our 401Ks for a year or more.

      ENGAGE! ENGAGE! Yes Steve is gone. But it is time to engage in the aerial dog fight. YOU OUT GUN THESE TROLS!!!

      1. Apple is late to the party. They may have to buy a system.

        Google was in negotiations with PayPal for two-years. Page and Brin wanted to partner with PayPals merchant services but in the 11th hour Google made an offer to the lead negotiator to join Google and he did.

        Osama Beider was a main player at PayPal, who knew all of Google’s financial weaknesses and PayPal’s road map for future projects and prospects, who went to negotiate with Google and stayed.

        Together they produced Google Wallet.

    1. No they don’t. You seem to be laboring under this misconception about online banking.

      When Apple takes your money, whether it be iTunes Store, App Store, or one of their 300 retail outfits, it goes into their bank account for whichever bank they do business with and THAT bank is not about to open 400-million accounts.

      That’s why Apple needs a PayPal-like partner. Partner, as in, let’s see what we can do together to create a seamless system, instead of reinventing the wheel.

      I’ll go out on a limb and state unequivocally, Apple cannot to do this alone. Peter Oppenheimer knows full well the severe limitations Apple faces going forward with iBeacon, without a financial management services division, to process all future transactions.

      They could surprise everyone and buy a bank or credit union, but they will need one for the European market as well.

      PayPal was made into a banking institution in the EU and their bank is in Luxembourg. Apple could easily use that facility for all of their EU transactions.

      1. 1. “reinventing the wheel” is what Apple is all about. This is why the financial industry fears them.
        2. Apple has stronger financials than any other global corp. -you really believe they do not have a talented team working through the problems /pitfalls?
        3. PayPal has terrible customer service. I know, I have dealt with them on both sides of transactions. This is not something Apple would look for in a “partner”

          1. Think outside the box. Read the article at Patently Apple -here’s a snippet:
            “Apple’s patent dives into creating a system to handle all sorts of loans, from student loans to Business-to-Business loans and everything in between,” Purcher reports. “In one part, Apple’s financial system almost hints of one day bypassing the credit card system entirely.”

      1. No need to search, their weaknesses are well documented on PayPal’s website. After their purchase of the small Israeli outfit named Fraud Sciences, all successful hacking has declined.

        The infamous Wikileak-related hack of PayPal perpetrated by 14 people resulted in 13 convictions. I’d say PayPal is not only robust, but they’re serious players in this financial market.

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