You’d think that wave-and-pay smartphone technology would be top priority for PayPal, one of the biggest competitors in the mobile payments space. But while big retailers love NFC for its hyper-targeted marketing potential, small businesses that run on payment services like PayPal may actually be interested in mobile payments for something far humbler: customer loyalty.
“The problem with NFC payments is that they don’t do anything to help generate new leads,” says Laura Chambers, Senior Director of Paypal Mobile. They also don’t do much to encourage repeat business, she says. PayPal services about 9 million merchant accounts, many of which are mom-and-pops who don’t want the expense of credit card terminals from a big company like Verifone. She says those merchants are ambivalent about how a customer pays–as long as they come back with friends and do it again.