PayPal Launches Revamped iPhone App, Teams With Bump For Phone-Tapping Money Transfers
PayPal has just launched an upgraded iPhone application that adds new features and includes a facelift that's meant to help instill a greater sense of security. And it also brings with it big news …
Context & Ripple Effects
This launch lands mid-arc for PayPal on two fronts. On distribution, eBay's payments arm had spent the previous months pushing beyond checkout buttons: a confidential document reported in July 2009 showed it preparing the more flexible Adaptive Payments API aimed squarely at Amazon's fledgling payment service, and in February 2010 Facebook added PayPal as a way to pay for ads and buy Facebook Credits. A native iPhone app with peer-to-peer transfer is the consumer-facing piece of that same platform push.
On trust, the timing is pointed. In December 2009 PayPal acknowledged its own legitimate email had been flagged as phishing by its own systems, and in February 2010 it was among hundreds of organizations hit by an unexplained SSL request flood. A facelift explicitly meant to instill a greater sense of security is a direct answer to that run of perception problems.
First-order effects
- iPhone users gain a redesigned PayPal app whose headline trick is money transfer by tapping two phones together via a partnership with Bump, making person-to-person payment a physical gesture rather than an email-address form.
- Bump gets its technology embedded in one of the highest-volume payment brands on the App Store at launch, converting a novelty gesture app into payment infrastructure overnight.
Second-order effects
- Rival mobile payment efforts — most immediately Amazon's young payment service that PayPal's Adaptive Payments API was built to challenge — now face a competitor pairing developer-facing APIs with a consumer tap-to-send habit on iOS.
- App-store gesture libraries like Bump become acquisition targets and partnership chips, because whoever owns the 'bump to pay' interaction owns a default placement inside future wallet apps.
Third-order effects
- If tapping-two-phones proves out as a transfer interface, the industry path runs from gimmick to standard — toward NFC-style tap-to-pay wallets where the phone itself is the payment terminal, and where payment apps compete on redesign cadence and trust signals rather than fee schedules.
The trend: Payments are migrating into the smartphone itself, with PayPal using app redesigns and device-gesture partnerships to turn a web checkout brand into a mobile wallet ahead of carrier and bank efforts.