PayPal’s going after Square and Intuit’s GoPayment with its PayPal Here, a mobile payment app and dongle combination that has at least three advantages over Square. First, from the promo video, it’s clear the product will be available internationally soon. That’s good. Second, the dongle encrypts the card when it’s swiped. Nearly a year ago, Square announced it would replace its reader with an encrypting model by Q3/2011. As far as we’re aware, that still hasn’t taken place. Third, PayPal supports multi-channel payments. For many retailers, the combination of e-commerce and POS sales is important. For customers, having multiple ways to interact with merchants is also important.
PayPal’s got a ways to go with Here. It needs an iPad app, it needs to enrich the app to help the merchant manage its business. But it could slow Square down and should add many more PayPal consumer touch points. While PayPal does the hard work of becoming a POS payment method for large retailers, it won’t hurt that those customers also encounter the brand at the farmer’s market, the coffee shop, or the wedding photographer.
In addition to accepting more payment methods, PayPal Here offers a simple flat rate of 2.7% for card swipes and PayPal payments. Merchants are also given a business debit card for quick access to their funds and 1% cash back on eligible purchases – which means if you use the debit card, your fees are actually just 1.7%!
PayPal Here is just the latest addition to our comprehensive suite of payment solutions for small businesses – from PCI-compliant checkout options and invoicing, to debit cards and mobile-optimized checkout. With PayPal Here, we are now able to serve as a one-stop shop for online, offline and multi-channel small businesses.