PayPal Beacon for hands free mobile payments

PayPal Beacon ImagePayPal are really stepping up their instore payment methods. As well as the new PayPal app with Check In, they just released PayPal Beacon in the states.

PayPal Beacon is a new add-on technology for merchants that will enable consumers to pay at their favorite stores completely hands-free. Of course they do already need to be running a PayPal compatible point of sale system.

What happens for the consumer? Well as soon as you walk into a store with a PayPal Beacon device and your smartphone in your pocket an automatic Check In takes place. Paying only requires a verbal confirmation, and you’re done. No wallet. No card. Nothing to do. Not even touching your phone.

PayPal say that they value your privacy, so PayPal Beacon won’t constantly track your location like other technologies. If you enter a store and decline to check in, or just ignore the prompt entirely, no information is transmitted to PayPal or the merchant. In fact it doesn’t even use GPS, mobile signal or even WiFi. The PayPal Beacon is a Bluetooth Low Energy (BLE) device which retailers simply plug into a power outlet.

BLE is important not just for privacy, their compeitor Square uses GPS/WiFi to track you which if the app is running will suck the power from your smartphone battery.

You can of course choose whether to automatically Check In. Shoppers will have full control of shops they want to check in to, those they want to get a prompt to confirm payment for, and which shops they want to enable a complete hands-free experience for.

Two of the most impressive parts of PayPal’s new payment systems are firstly that they exist at all – PayPal is rapidly innovating as if they were a brand new start up, not a 15 year old payments solution shackled to eBay. Secondly they’re rolling out brand new innovative hardware (PayPal Here, PayPal Beacon), not a bad feat for a software company.

Much as Donahoe’s oversight of eBay have seen the marketplace rejuvenated, it would look like David Marcus, who joined the company and became PayPal President when they bought start up Zong, is breathing new life and a new direction into PayPal.