Today PayPal has confirmed the launch of a new mobile payment service. Called PayPal Mobile it will allow customers to make payments and transfer funds via SMS text messages from mobile phone.
To use the service that is currently available in U.S., Canada and U.K. customers have to activate their phone on PayPal. After that they can transfer funds to other PayPal accounts by simply sending SMS text message or calling toll free number and following voice instructions.
Security of mobile transactions is assured by a unique PIN that users create when activating the phone. After receiving payment request, PayPal will automatically call back and request to enter the PIN. Customer has to confirm payment details for every transaction. If there’s no confirmation after the call, no money is sent.
In parallel to new service for consumers PayPal will be launching the service for merchants, enabling tem to receive payments for products via PayPal mobile. Service, called “Text 2 Buy”, enables merchants to get unique ID for their products and put them in various on-line and off-line ads. Whenever customer sees a message “Text 2 buy” with product ID, he can send SMS to PayPal and pay for the product. Immediately after that, PayPal automated verification service will call him back to confirm the order and ask to enter PayPal Mobile PIN. After the PIN is entered the item is shipped to the home address listed in PayPal account.
PayPal plans to extend mobile service to 55 countries and regions where it is authorized to transfer funds online.
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