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Table of Contents

Lead Story

Integrated systems create a new POS paradigm


Industry Update

Intuit's IMS ends agent program

Indictment halts the action for poker sites, processors

PayPal, Discover launch Money Messenger

Does certification without licensing make sense?

Selling Prepaid

Prepaid in brief

China's prepaid market a different world

Prepaid's unique way in India


Text message marketing, the other mobile

Pal Flagg
Street Savings

Meet The Expert: John Arato

Technology in the hospitality world

Press release power


Facts and figures from the feet on the street

Jeffrey Shavitz
Charge Card Systems Inc.


Street SmartsSM:
Let's reform our industry's education and training

Bill Pirtle
MPCT Publishing Co.

What tokenization is and isn't

Tim Cranny
Panoptic Security Inc.

Ask, don't sell

Jeff Fortney
Clearent LLC

How to use direct mail to build your business

Peggy Bekavac Olson
Strategic Marketing

Global opportunities mean global strategies

Caroline Hometh
RocketPay LLC

New Products

Tapping the government and education markets

Electronic Merchant Systems


Learn to make use of conflict


10 Years ago in
The Green Sheet


Resource Guide



2011 Calendar of events

A Bigger Thing

The Green Sheet Online Edition

May 09, 2011  •  Issue 11:05:01

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PayPal, Discover launch Money Messenger

PayPal Inc. entered into the person-to-person (P2P) product market in April 2011 when Discover Financial Services launched its new Discover Money Messenger Service, a free application that allows card customers to transfer money on or by using a smart phone.

The Discover-PayPal partnership was announced in October at PayPal's Innovate 2010 conference in San Francisco. The launch moves PayPal into competition with companies such as Visa Inc., American Express Co., and the privately held Square Inc. in the market offering new payment services to replace cash or checks.

"Discover cardmembers can start sending money to any person using only the recipient's email address or mobile phone number," PayPal Senior Director, Corporate Strategy Dan Schatt wrote in a recent blog discussing the launch.

"The sender doesn't even need a PayPal account, and the recipient can open one up with just a few clicks if they don't already have one."

Schatt said he believes the future of the payments industry is driven by companies that offer people ways to send and receive money in any manner they choose, anywhere in the world.

How the service works

The new service is free; customers receive up to 0.25 percent cash back for every transaction up to the first $3,000 received.

"Discover cardmembers who need to send money to a child in college, want to split a check at dinner or otherwise send money to another person can easily do so directly using any web connected device," Schatt noted in his blog. "The amount sent is charged to their Discover card account just like a purchase."

However, to receive money the recipient must register for a free PayPal account. When money is transferred, PayPal sends an email to notify the recipient that the money is being held for him or her in a PayPal account.

Recipients must log in or register with PayPal to get their money. They can then transfer money to a bank or credit card from their PayPal account. PayPal does not charge for the transfer.

Money Messenger requires only a cell phone number or email address to transfer money from a smart phone to recipients in 60 countries. The new service uses PayPal's Adaptive Payments application program interface (API), a part of the PayPal X platform.

The Adaptive Payments API allows developers to build customized payment services. PayPal is currently at work developing this technology to use with ATMs in a way that will allow ATMs, among other things, to handle remittances.

Another alternative to cash

"Discover's work is a great example of how third-party developers can use PayPal X to create a new generation of payment options," Schatt said in a fall 2010 release. "PayPal X makes it possible for developers to monetize their great ideas by affording them security and connectivity through 27 financial networks and 15,000 local banks."

Market analysts see the Money Messenger launch as part of an industry move toward replacing cash transactions.

Industry analysts believe Money Messenger will impact not only PayPal's future but also eBay's since PayPal accounts for an estimated 20 percent of eBay's stock value.

Because Money Messenger requires recipients to register with PayPal, the number of PayPal accounts and the frequency of payments processed per account should increase. However, analysts also noted Money Messenger is designed to replace small cash payments, making it likely the average amount per PayPal transaction may decrease.

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.

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Spotlight Innovators:

North American Bancard | Simpay | USAePay | Impact Paysystems | Board Studios