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PayPal Brings Mobile Payments To U.S.

Posted by Zonk on Sun Apr 16, 2006 07:27 PM
from the lol-i-pay-kk dept.
Wireless Networking Businesses Hardware
An anonymous reader writes "PayPal is bringing the eastern use of the cellphone as a payment method to the United States. The company's mobile service aims to use secure text messages as a payment method for direct-marketing initiatives and other 'on-the-spot' mercantile opportunities." From the article: "To the extent that digital money doesn't feel like real money, it may increase spontaneous purchasing ... " This story offers more details on a discussion we had last month.
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[+] PayPal Goes Mobile 103 comments
Stitch_Surfs writes "PayPal has gone mobile. MobileCrunch breaks the news (with images) of PayPal's (un) surprising move onto mobile phones. According to the site, money can be sent,received and goods purchased all via PayPal from your mobile phone."
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PayPal Brings Mobile Payments To U.S. 50 Comments More /

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  • Oh good! (Score:5, Funny)

    by Anonymous Coward on Sunday April 16 2006, @07:31PM (#15140105)
    Now I can fall victim to a phishing scam anywhere

  • PayPal sucks (Score:2, Informative)

    by Anonymous Coward
    So, what's wrong with PayPal?
    What do I need to know about PayPal and what about the lawsuit?

    http://www.paypalsucks.com/ [paypalsucks.com]

    1. According to PayPal accepting their ToS (Terms of Service) in effect means you waive your rights to credit card consumer protection laws if you want to use their service, and that you may not issue a chargeback for unauthorized use of your credit card and PayPal account, or if you do, then they have the right to limit your account. Is this legal? We don't know. But it's how Paypal operat
    • Move to Europe. The Paypal ToS are better over here, they are subject to regulation (as an "issuer of electronic money") and are answerable to the UK's Financial Services Authority. They can't lock your entire balance due to a dispute over part of it, and you have the right to appeal over their heads to the regulators if they mess you around.

      Alternatively, pester your elected representatives for some legislation compatible with the relevant EU stuff. Get some proper Data Protection laws while you're at it.
      • You got a better alternative?

        Ya, it's called accepting only cashiers checks when doing business over the internet. I sell on e-bay "as is". No refund. My credit and merchant integrity is based on account feedback.

        Sorry folks, but when you get fucked by Paypal and those who abuse it, you do business strict and to the point (like me).

  • Great (Score:2, Interesting)

    by bl00d6789 (714958)
    So, on top of the already outrageous eBay and Paypal fees, there will be text messaging fees. I'll be sure to use this on a regular basis. Paypal is already worse than my bank when it comes to ridiculous fees.

    • Re:Great (Score:4, Informative)

      by iamdrscience (541136) <{michaelmtripp} {at} {gmail.com}> on Sunday April 16 2006, @08:01PM (#15140206) Homepage
      That's not really true, Paypal only charges fees on credit card transactions and the fees they charge are reasonably well in line with what other credit card gateways charge merchants when you purchase something from them with a credit card.

      Whether the fees charged by credit card gateways are too much is another matter, and seems like it might be the case. I seem to recall class-action suits being brought against Mastercard by merchants because they felt the fees they charged were unjustified.

      The fact of the matter though, is that although as a consumer you generally don't realize it, merchants always take a hit on credit sales and it's not always small. There are plenty of legitimate complaints about paypal and I don't see this as being one.

  • Logical (Score:4, Insightful)

    by gerbalblaste (882682) on Sunday April 16 2006, @07:39PM (#15140125) Journal
    This is a logicalextension of paypal's increasingly omnipresent marketing and services.
    Paypal has diversified into many diferent branches and while this new mobile payment may be subject to some criticism and a degree of scepticism it is likely that this will come to be as pervasive as credit cards.
    • What if they offered this on other handheld devices?

      Then you could transfer funds without paying cellphone fees.

      For example, you could make payments over the infrared interface of a PDA. You could even "beam" someone money to settle a restuarant bill.

      This would also be possible with 1999 techology.

      In fact it was done, and this is one of the key PayPal features from their launch. It got quietly dropped on the floor a few years later.
      • As a matter of fact, Paypal used to offer a PalmOS program that did exactly what you describe. But they withdrew it — there was no way for them to make money off it.
  • ...is to be able to take a picture with my camera phone of a barcode on an item that I want to purchase. This would bring up comparison shopping info about the item, etc. If I want to buy the item, I'd just push pound or whatever.

  • An ounce of prevention... (Score:3, Insightful)

    by Fantasio (800086) on Sunday April 16 2006, @07:46PM (#15140151)
    No parent will buy a cellphone to their kid unless the feature is disabled.
    • >No parent will buy a cellphone to their kid unless the feature is disabled.

      Same as prepaid charge card, paypal damage is limited to the credit backing it. (link it to your bank account, bad, link it to the same charge cards they already carry, no change.)

      as others have said, your recourse may be a bit more questionable through paypal. (but have you read your credit cards policy? most have in home state, and extreme time limits, and a mulit page dispute form that must be mailed within a short period o

  • The perfect model (Score:4, Insightful)

    by nighty5 (615965) on Sunday April 16 2006, @07:49PM (#15140162)
    What a sensational business model.

    1) Act and charge like a real bank, but don't say you're one.

    2) Offer no real customer service, treat customers like thieves, offer no financial protection, unlike a real bank don't be forced to implement security and continity controls

    3) Profit!
    • I see PayPal found the elusive ??? step before profit. Oh my, it's quite a mouthful.
    • I don't know if someone disagrees with the parent post. Indeed, they may have reason to disagree with it, and good reason.

      Moreover, the parent post did not go into much detail. So I can even see where an ignorant modder might think that the post is a troll.

      However, there have been *tons* of people cheated by Paypal in combination with real thieves. I am one of them. That is, Paypal showed that they have no incentive to either use the insurance that they advertised they had; and they showed that they had

  • The Original Concept (Score:2, Informative)

    by Anonymous Coward
    This interests me primarily because PayPal was originally designed as a mobile payment service for PDA users. Mobile phones now incorporate a substantial amount of functionality that was once restricted to the PDA.

    Maybe their original idea was simply ahead of its time.

  • TextPayMe already does this (Score:4, Informative)

    by pHatidic (163975) on Sunday April 16 2006, @07:53PM (#15140179) Homepage
    TextPayMe already provides this exact same service. I wonder if they have a patent on it.
  • Secure & text message don't really belong together.

    SIM cards & phones can be cloned. IIRC, the text messaging network is susceptible to a DOS. Your cellphone isn't a credit card... you can't exactly charge back someone else's impulse buy.
    • Oh, I'm sure PayPal will do everything in their power to make sure there are plenty of protections in place for consumers.

      </cynicism>

    • Secure & text message don't really belong together.

      So you use something else and write software for the phones to handle it - most phones can run java applications these days and I've heard of RSA authentication even being used on the humble Z80 processor (and phones have faster processors than that). A couple of years ago software and back end hardware for this task was developed by a small company in a provincial city in Australia to be used in fuel stations in Italy. Surely a very large US company

  • Nothing logical about this (Score:5, Interesting)

    by tehwebguy (860335) on Sunday April 16 2006, @07:59PM (#15140199) Homepage
    so far the only thing they seem to be pushing is cd/dvd sales -- how the hell could it possibly be convenient to buy a cd via paypal via phone? why would i want to send a text message, and then receive a call in order to find out the price and shipping?

    if i want music, i want it now, so if i'm shopping i will buy it at the campus music store, or if i am home i will buy it on itunes. the only time i buy cd's online at all are when they are not on itunes or at the cd store.

    there's still hope though!

    what if i could buy my movie tickets on my phone instead of waiting in line at the theater? that would actually be cool.
  • All the more reason to steal someone's cell phone...

  • Nice... (Score:5, Funny)

    by Ecko7889 (882690) on Sunday April 16 2006, @08:00PM (#15140205)
    So now after the hookers done, all I got to do is text her?

    We'll call it Pay4Pal.

  • Good Idea Gone Horribly Wrong (Score:4, Insightful)

    by mpapet (761907) on Sunday April 16 2006, @08:05PM (#15140220) Homepage
    This problem has been solved years ago and the average mobile phone is more than capable of working as an electronic purse. A mobile phone needs no centralized network to process transactions and most certainly is more efficient and trackable than paper currency and Visa/MC association payments.

    A tangentially related way to see how abusive things are in the association world is Walmart wants to open a "bank" so they can keep a piece of the Visa/MC Association rent.

    The way this will be implemented will be the same old very inefficient way of processing payments with each company in the "chain" demanding their pound of flesh along the way.

    This idea is DOA.
    • A mobile phone needs no centralized network to process transactions and most certainly is more efficient and trackable than paper currency and Visa/MC association payments.

      Of course it needs a centralized network. Otherwise, what's to prevent me from hacking my phone and changing the amount of money that I have?

      I understand what you're saying, in a sense: the transaction processing does not have to be centralized but it definitely must be authoritative. Without an authority, you must trust the phone
    • It needs a centralized something to work, be it the cell provider's system, Visa/MC/etc, Paypal or the banking system, which all have centralized controls in one form or another.

      You said the problem has been solved before, I'd like to know what that solution is. I am skeptical as it would seem that the cell network providers would want a hefty piece of the action, these are the bastards that charge $3 for a 3 month expiring 100x100 wallpaper.

  • PayPal International Support (Score:5, Interesting)

    by suv4x4 (956391) on Sunday April 16 2006, @08:11PM (#15140237)
    I'd like to take the word tonight to whine about PayPal not supporting my country, Bulgaria.

    Every time I see a PayPal donate / purchase button I'm automatically filtered out since they just don't support my country and declineto accept my credit cards if I try to sign up.

    For what is considered the most popular micropayments system in the world, they'd do better to hurry up and actually support the world..
      • "In other words, your country represents approx 0.11% of the global population. Do you really expect them to care?"

        I don't expect them to particularly care about anything seeing how abysmal is the tech support and service for their already existing customers.

          • Re:PayPal International Support (Score:5, Informative)

            by suv4x4 (956391) on Monday April 17 2006, @01:31AM (#15141000)
            "The reason why PayPal (and most other financial institutions) don't support the eastern european countries is that those countries are notorious for the sheer number of fraudsters. So much so that it is not worth it to provide service there."

            Thanks for standing behind an old stereotype that offers quick answers. However you may notice that "fraudsters" script kiddies can obtain US credit card numbers and then sign up without problems for PayPal.

            It's guys like me who want to sign up with their own credit card that have the problem. The credit card operators in Bulgaria are the same as those well known internationally (MasterCard, Visa, Diners Club etc.).

            And to bust another stereotype, it's not "most other financial institutions" that don't support Eastern Europe, from the big payment processing companies, the problem is specifically with PayPal.
            • I second this, I'm getting tired of all this "we don't support Eastern European clients" crap. I'm in Romania and have both debit and credit cards issued by Romanian banks. A Romanian client signing up with a Romanian credit card from a Romanian IP is definitely less likely to be a fraudster then someone signing up with a US credit card from an IP in Eastern Europe and asking for his goods to be shipped there.
  • Will cell phones become a wanted item by criminals? Steal a cell phone, and use it to buy stuff? The only good thing about cell phones is police can use it to track the thief. Or the thief can use the cell phone to buy something, then throw it away under the back seat in a bus.

    • You've been able to pay for things with you cell phone in Japan for years. See http://www.sony.net/Products/felica/ [sony.net]. Basically they put the smart card chip in your phone and let you minimally interact with it from the phone GUI. Very convenient -- I forget my "Chicago Card" all the time... but never my cell phone. If the devices were integrated, my life would be easier :)

      Sadly there's too much worry about everything here to adopt any new technology -- so we'll always be 5-10 years behind the rest of t
  • Guy: "Hi, sir, Could you help a poor man out and let me borrow your cell phone for a quick moment to call my family? I'm going to be late for my daughter's birthday." Me: "Sure, here you are" Guy: "Thank you kindly, sir.." Guy: *transfers cash to his paypal account, while pretending to have trouble figuring out the phone* Guy: "Ah ha!" *after having transferred the money and pretending that he finally figured out what to do* Guy: *fakes a call to his pretend family, while actually calling his voicemail* Guy

    • Guy: "Hi, sir, [remainder of unlikely made up theoretical story] This'll be fantastic!
      --
      Get a free Macbook Pro for yourself, and help me do the same. [free4me.net]

      Right. Like we're supposed to take 'how to not get scammed' advice from a guy advertising a pyramid scheme [wikipedia.org] in his sig.

      If you believe that stuff, getting fleeced by paypal's service or loosing your phone are probably not at the top of your problems.

  • Does that mean we can have our own little Donate Now text message or recording on our cell phones?
  • I see this as a great way to get rid or receipts. Lets face it, they always give you a receipt, but ever since I was able to look at my statement online, I've never worried about receipts. Think of how much paper this will save!
    • Not to mention the complete elimination of cash worldwide (yeah, right). While I too don't worry about receipts since I got eBanking, I like to have something to verify their screw-ups against. As it is, I almost never buy anything in person anymore, and I could not have a debit card and still function with my online purchases perfectly (not because it's saved everywhere, but because I've memorized it from typing it into Newegg so many times).

      Honestly, having your local MegaStores not having an eight-fo

  • Next we will explain how freedom of speech and democracy work.
  • Bless their hearts, but, how did the editors decide a PayPal article should be placed in the Hardware section of Slashdot? :)
  • Paypal has a hard on for "limiting" account access for just about any reason today. Does anyone see the nightmare of trying to use paypal on a mobile phone? You had might as well call paypal and ask them to suspend your account, because 10 seconds after you sign up for "paypal mobile" your paypal account will suddenly have "suspicious" activity (you actually using it)and will be limited for "your" protection. Paypal limited my account access when I was using my paypal debit card out of state (one state over

  • Fantastic (Score:3, Funny)

    by xenocide2 (231786) on Sunday April 16 2006, @10:31PM (#15140633) Homepage
    Now I can lose my cell phone and my credit card at the same time!
  • Woudln't the phone need to have some way to encrypt these text messages before sending them?  I know none of the phones I have had in the past do not encrypt the messages. This would also mean that if they did come up with some way to encrypt them, pre-existing phones would not have the ability to use this service.

    Will they allow phones that do not suport this level of security?  I would guess yes they will, because I dont think it will be secure in anyway.
  • The company's mobile service aims to use secure text messages as a payment method for direct-marketing initiatives and other 'on-the-spot' mercantile opportunities.

    What's a 'secure' text message?

    Also as 'in USA nobody uses text messaging [slashdot.org]' who is going to use it?

    People actually have to pay to receive texts in the US (utterly idiotic at best) - is this how they are going to generate (even more) revenue from users? Will we see tiered text pricing from operators as they are able to effectively tax users?
    • An automatic system makes a voice call to your phone after you have texted "send 14.99 to 2125551212" to 729725 ((PAYPAL)) and you touch-tone back a PIN which you set up when you activated the PayPal Mobile service. So the phone thief would need your PIN, not just your phone.
    • This is PayPal we're talking about. I'm sure that "Don't let your phone be stolen" is part of their Terms of Use, so as soon as you report that you have lost it they will immediately freeze your account, charge you a substantial fee, and then claim that you have been flagged as a possible fraud risk and confiscate what's left of your money.
      • That's pretty much what happened to me a few years back, except without the cell phone. I do something pefectly reasonable that they claim violates their ToS, and when all was said and done I was out about $1500.

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