PayPal enters point-of-sale market
(10 January 2012 – Global) As EBay-owned PayPal moves to expand into the physical world of brick and mortar it has begun testing in-store payments with US-based home Depot.
A pilot program for PayPal's new point-of-sale, or POS, technologies is being run in five Home Depot stores and involves a 'small number' of PayPal employees, PayPal spokesman Anuj Nayar said.
PayPal has over 100 million users, online but is trying to expand into offline payments, a much larger market. The move will pit it against Visa, MasterCard and American Express.
In September, PayPal pitched its new in-store payments system to about 120 retailers, including Sports Authority, at an event in Los Angeles. EBay Chief Executive John Donahoe spoke about the initiative several times last year, but the company had not disclosed which retailers agreed to test it first.
While the Home Depot trial is small, Wall Street analysts are excited about the potential.
'We believe a full Home Depot roll out would increase PayPal's addressable market by more than 35 percent overnight,' Gil Luria, an analyst at Wedbush, wrote in a note to investors.
'Although penetration would start at zero, we believe that by adding value to consumers and merchants, PayPal may eventually approach penetration rates comparable to its online presence.'
PayPal has over 100 million users, online but is trying to expand into offline payments, a much larger market. The move will pit it against Visa, MasterCard and American Express.
In September, PayPal pitched its new in-store payments system to about 120 retailers, including Sports Authority, at an event in Los Angeles. EBay Chief Executive John Donahoe spoke about the initiative several times last year, but the company had not disclosed which retailers agreed to test it first.
While the Home Depot trial is small, Wall Street analysts are excited about the potential.
'We believe a full Home Depot roll out would increase PayPal's addressable market by more than 35 percent overnight,' Gil Luria, an analyst at Wedbush, wrote in a note to investors.
'Although penetration would start at zero, we believe that by adding value to consumers and merchants, PayPal may eventually approach penetration rates comparable to its online presence.'
Subscribe