PayPal Introduces Contactless Payment Option for In-Store Purchases in Germany

PayPal is expanding its services in Germany by launching a new contactless payment feature that allows users to pay at physical retail locations using their smartphones. This new functionality positions PayPal as a competitor to existing mobile payment solutions offered by major players like Apple and Google.

Set to be integrated into the PayPal app this summer, the feature will enable customers to make payments at point-of-sale terminals where contactless Mastercard transactions are accepted. Germany is being identified as the first market globally to adopt this feature.

With the latest version of the PayPal app, users will be able to utilize a 'Tap-to-Pay' system, enhancing their shopping experience by providing a comprehensive overview of both online and offline purchases within the app.

This new payment option will be available for both Android and iPhone users. Notably, it represents a significant development for iPhone users, who have traditionally relied on Apple Wallet for mobile payments. Following recent regulatory changes in the European Union that mandated the opening of the NFC (Near Field Communication) interface on iPhones, PayPal and other providers can now facilitate contactless payments on these devices. The Norwegian payment app Vipps was the first to utilize this capability at the end of 2024.

PayPal is now the second service, after local credit unions, to announce plans to utilize Apple's NFC interface for its payment solutions in Germany, although both have yet to fully launch their services. On Android devices, however, there are no such limitations on the NFC interface, allowing for broader payment options.

Additionally, PayPal is introducing a 'Buy Now, Pay Later' service for in-store purchases, similar to its existing online shopping option. Customers will have the flexibility to choose from multiple payment plans, spanning three, six, twelve, or even twenty-four monthly installments. Applications for this service can be conveniently completed through the PayPal app.

Furthermore, PayPal is set to roll out a cashback program that rewards users for specific purchases made through the app in stores. However, further details regarding participating merchants and discount offerings will be disclosed at a later date.

While PayPal's entry into the mobile payment market comes later than its competitors, it offers a viable alternative for consumers who may not have access to credit cards, which are often required by Apple and Google's payment systems. This development could significantly benefit users looking for convenient mobile payment solutions.