PayPal Could Be On To Something Huge With Beacon

Chris CrumTechnology

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It's hard to tell what's going to work in the payments space. There have been a lot of interesting ideas over the years, but they haven't always translated into the revolutionary game-changers that they could.

PayPal's new product - Beacon - is one of those interesting ideas, and it could work.

The company, obviously already accustomed to revolutionizing how people pay for things, makes a pretty compelling case for a hands-free shopping experience.

Beacon itself is a small device that stores can plug into their power outlets, and it enables shoppers with the PayPal app to pay for their orders without having to wait in line, or in some cases even touching their phones.

PayPal Beacon

The device makes use of BLE (Bluetooth Low Energy) technology to avoid poor connections and battery drain. The PayPal-enabled phone and device will simply recognize one another when the customer is in the store.

"Now, instead of finishing a meal at a restaurant by waiting for the server to run your credit card, and then finally return it for your signature, you can simply pay using your PayPal app and leave when you’re ready," says PayPal President David Marcus. "And, instead of waiting in a line to pick up and pay for your takeout order, you can order ahead through our new app to skip the line altogether."

"Consumers will have full control of stores they will want to check in to, those they will want to get prompted to confirm payment for, and stores they will want to enable a complete hands-free experience for," he explains. "In the latter case, simply walking in a store will trigger a vibration or sound to confirm a successful check in (this happens in milliseconds), your photo will then appear on the screen of the Point-of-Sale system so you can be greeted by name. Paying only requires a verbal confirmation, and you’re done. No wallet. No card. Nothing to do. Not even touching your phone."

Any store using a PoS system that is compatible with PayPal can plug in the device and enable this kind of shopping experience. Right now, those compatible include: Booker, Erply, Leaf, Leapset, Micros, NCR, PayPal Here, Revel, ShopKeep, TouchBistro and Vend. According to PayPal, there will be "many more" soon.

The name Beacon in the tech world has a history of privacy-invading connotation. You may recall Facebook's Beacon ad technology, which was killed after a privacy-related uproar. PayPal insists its Beacon won't track users' locations like other technologies. Users can decline to check in or ignore the prompt that asks them to do so when they enter a store, and no info is transmitted to PayPal or the merchant.

PayPal is giving developers access to the PayPal mobile in-store API, so they can create self-checkout experiences and other concepts. PayPal is taking idea submissions from developers here. The company will chose 100 developers to get early access to the API and a developer version of the Beacon device before it's rolled out.

The company expects to pilot Beacon-enabled shopping experiences in Q4 and roll it out broadly early next year.

Chris Crum

Chris Crum has been a part of the WebProNews team and the iEntry Network of B2B Publications since 2003. Follow Chris on Twitter, on StumbleUpon, on Pinterest and/or on Google: +Chris Crum.