Ebay’s online payment service unit, PayPal has signed partnership agreement with Discover Financial Services to leverage Discover’s network of credit card payment systems to offer PayPal payments to more than 7 million physical stores in the US, extending its reach beyond the Web.
Under the agreement, PayPal will issue payment cards to its active users, claimed to more than 50 million in the country next year, allowing them to use the cards to make purchase from stores that already use Discover Network.
Now the merchants will not have to install or upgrade existing point-of-sale hardware or software to offer PayPal and the consumers will be informed about this additional payments option through in-store signage.
Under the partnership, PayPal is expected to bring brick-and-mortar merchants more shoppers in store and to extend convenience and utility for consumers through mobile payment applications.
In addition, PayPal’s active US customers are expected to help increase customer engagement, loyalty and incremental sales at the physical point of sale.
Discover Payment Services president Diane Offereins said enable the partnership will provide their US customers acceptance at millions of physical point-of-sale locations by leveraging its payment services assets.
"The establishment of this relationship is a major industry milestone, which will help shape the emerging payments landscape by bringing together an established direct banking and payments company with a leading commerce enabler to create an alternative payments option for consumers at the point of sale," Offereins said.
"This initiative will result in real change and innovation for the industry by bringing new technologies to the point of sale that benefit merchants and PayPal customers."
PayPal Retail vice president Don Kingsborough said the new partnership extends PayPal’s reach to millions of merchant locations nationwide and will create new benefits for Discover merchants without requiring new hardware or software.
"This relationship will deliver a truly seamless digital wallet, available most places consumers shop offline, which offers the speed, simplicity and security already enjoyed by 113 million active PayPal customers online," Kingsborough said.
PayPal is a subsidiary of eBay, which the company acquired in 2002.
