Mobile Technology

PayPal launches "Here" smartphone card reader

PayPal launches "Here" smartph...
PayPal has introduced its new Here cardreader system for smartphones
PayPal has introduced its new Here cardreader system for smartphones
View 10 Images
PayPal's new Here system is designed to allow easy payment using smartphones
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PayPal's new Here system is designed to allow easy payment using smartphones
Businesses offering Here service will sport the distinctive blue logo
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Businesses offering Here service will sport the distinctive blue logo
PayPal's Here system comes in a specially-designed protective package
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PayPal's Here system comes in a specially-designed protective package
Businesses offering Here service will sport the distinctive blue logo
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Businesses offering Here service will sport the distinctive blue logo
The Here logo
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The Here logo
The PayPal Here card reader attaches to a smartphone's audio jack
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The PayPal Here card reader attaches to a smartphone's audio jack
PayPal has introduced its new Here cardreader system for smartphones
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PayPal has introduced its new Here cardreader system for smartphones
The PayPal Here card reader attaches to a smartphone's audio jack
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The PayPal Here card reader attaches to a smartphone's audio jack
The Here logo
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The Here logo
The PayPal Here card reader attaches to a smartphone's audio jack
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The PayPal Here card reader attaches to a smartphone's audio jack
View gallery - 10 images

The profusion of apps for smartphones certainly seems to know no bounds, and while NFC based payment seems set to become the dominant form of cashless transaction, smartphone peripherals that allow users to swipe credit and debit cards still have a role to play. The most notable of these devices is Jack Dorsey's Square system and now, online payment giant Paypal has flexed its appreciable muscle and entered the fray with its new, triangular "Here" card reader, due initially for a limited release.

Paypal, which made a name for itself by pioneering the secure cashless transfer of money over the Web, wants to expand by bringing its simple, efficient system to real world, face-to-face payments, as well. To help pull it off, they approached San Francisco design house, fuseproject, and the result is a system that will, literally, give Square a run for the money. Like its four-sided competitor, Here will also be free, but each transaction will incur a 2.7% transaction fee. iOS 4.0 iPhone and (eventually) Google Android owners in the U.S., Canada, Australia and Hong Kong will get first crack at it, with other regions to follow thereafter.

The PayPal Here card reader attaches to a smartphone's audio jack
The PayPal Here card reader attaches to a smartphone's audio jack

When attached to the top of a smartphone's audio jack port, the front of the two-layer arrow-shaped reader swings down to keep the device from pivoting on its circular connector while reading cards. The app that drives it will produce a distinctive audio tone that signals both successful connection of the device to the phone and completion of each transaction - a feature designed to help put both customers and businesses new to mobile payments at ease.

The Here logo
The Here logo

Merchants and restaurants joining the system will sport the blue Here logo and their info will appear in the PayPal mobile app directory. Business owners will have the ability to send electronic invoices with the system which also comes with PayPal's security and fraud protection.

For more on the system's capabilities, check out the PayPal Here faq page.

Source: fuseproject via dezeen

The following PayPal video shows Here in action:

View gallery - 10 images
15 comments
15 comments
Denis Klanac
2.7% transaction fee? FAIL!
Lumen
And let's see Denis: Square charges 2.75 percent + 15 cents for swiped transactions, and 3.5 percent + 15 cents for keyed-in transactions, as shared from the most recent Gizmag Square-related article. PayPal's offering is lower, even if slightly. If one of them wants to dominate, go 2.3 percent.
Rocky Stefano
@Lumen. What makes you think 2.3% is the winning rate?
iWonder
This idea is clearly stolen from Square. I hope Square had a patent, sues and wins. (Small innovators deserve to prosper.)
Its sad that the only way to connect to an iPhone is thru the ANALOG headphone jack! Of course, this is an ugly hack. The ultra-closed architecture of the iPhone really is sad. I wouldn't be surprised if Apple replaces analog jacks with something proprietary and digital - says its better...buy your iDigitalBuds at apple.com for only $65.
Can't they support printing via Bluetooth to a local printer at the muffin stand?
Matt Rings
Stolen? There's no patents for credit card payment methods. Just need a company to commit the resources and risk of starting up... some will survive, others won't due to costs, customer service or security concerns.
Heaven help if they were American Express... the total fees may add up to over 5% for transactions. Ever wonder why many businesses don't accept American Express? That's why. 2.7% is not terrible...just the cost of doing business and being convenient for your customers (who might not return otherwise!)
Synchro
Square has one massive advantage: it's not PayPal. See here for one example: http://conferencesburnedbypaypal.tumblr.com/
iWonder seems to be from some other planet where iPhones don't have a well documented and very capable dock connector. That said, I see no problem using the headphone jack since a card reader is just a very simple analogue tape player, and using another mechanism would have added to the costs of design and production.
It's a bit disappointing that it doesn't seem to have a chip reader since not much of Europe uses (or accepts) swipe readers any more.
Ira Munn
From Rocky: @Lumen. What makes you think 2.3% is the winning rate?
Psychology, sir. The two and the three are closer together, lending greater appeal than two and seven, which are further apart. Also 2.3 percent is phonetically easier to say, plus being one syllable shorter than 2.7 percent, both attributes lending greater appeal to word-of-mouth marketing... the best kind.
Additionally, people want to be with a familiar winner that apppeals to the Genesis of their learning. If people conclude in their mind that "They're number one because they're 2.3 percent," the sequential familiarity of the numbers in that thought will increase the desire to be associated with both the company and product, irrespective of whether the person is presently associated or not. The result of this appeal will increase both customer retention and new customers.
pointyup
Appeal will start when transction fee is less than .5% up to a maximum of $4 per trans. Pay Pal is plain greedy. Imagine if road tolls were based on the value of the car you drive.
Synchro
This also strikes me as being a bit old-fashioned. There are far better mobile payment mechanisms appearing now, in particular gocardless.com and Barclays pingit. Both charge much lower rates than paypal (1%), and cut out the paypal 'middle man'. Some limitations at present (you need a smartphone), but they're definitely leading the way.
marEB
I have been using PayAnywhere for my business for a while. They have proven to be reliable, as I always receive my funds on time. Their app is very easy to use and had made credit card processing a breeze. I definitely won’t be switching.
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