The European mobile space already has its contenders, but a large global player has now entered the continent to see what it can do. PayPal Here has launched a mobile payments reader in the UK, the next largest country in the mobile payments space after the US.
PayPal already has an established presence in the UK, so it already has brand recognition. The company launched PayPal Here in the US and several countries last year to give Square a run for its money. Square launched in 2009 with a small device that could plug into smartphones and tablets to allow merchants to take mobile payments, a handy convenience for trade shows, flea markets, and anybody selling merchandise on the go. Square has yet to launch in the UK.
PayPal had yet to launch in the UK, mostly because the country uses the “Chip and Pin” payment system, in which readers read a microchip embedded in financial cards that are protected by a PIN identification provided by the user. For its foray into Europe, the company launched PayPal Here with a separate device it designed from scratch to handle Europe’s system of payments. The device is about the size of a smartphone, and connects via Bluetooth to a smartphone app.
“It’s a great example of our renewed focus on creating beautiful and easy-to-use products that are tailored to address our customers’ specific need,” Hill Ferguson, VP of Global Product, wrote on PayPal’s blog announcing the service’s launch in the UK. “In this case, for small businesses to finally offer their customers an easy to use alternative to cash.”
PayPal has yet to set a price or a launch date for the device, though other competitors on the continent have charged 2.75 percent per transaction with readers priced around €49 ($65). PayPal has indicated it will strive to be competitive.
The UK is definitely offers promise. At 61 percent penetration, the UK currently has one of the highest smartphone penetrations in Europe, according to Kantar Worldpanel Comtech. However, it is also a crowded space, with other competitors that include Payleven, iZettle, mPowa, and SumUp with an already established presence.
PayPal, however, has size and brand recognition on its side. The company provides small business owners with a recognized way to take payments, meaning more Europeans can rely on their cards instead of cash or check and step into the 21st century.