While Apple’s taking a wait and see approach to the nascent mobile payments and digital wallet industries, PayPal seems ready to launch an all-out offensive. In addition to its existing assortment of mobile, local, and online payment systems, PayPal announced this week that it is acquiring startup card.io.
card.io currently works with a range of iOS and Android developers to help them integrate mobile credit/debit card payment capabilities into their apps without the need of additional hardware like Square’s card reader or PayPal’s Here card reader. Instead, card.io’s partners use the built-in camera of an iPhone (or other iOS or Android device) to snap a photo of a credit card. The card number and related information is extracted and passed to a payment processor to complete the transaction (manual keying in a card number is also supported as a backup).
There have been a handful of technologies touted over the past few years that would remove (or dramatically reduce) the need to carry our credit/debit cards, loyalty cards, and even cash. For the past couple of years, NFC has been the technology of choice for turning our phones into digital wallets. Google and RIM have built NFC support into their respective mobile OSes and a handful of manufacturers have built NFC phones, but the technology hasn’t lived up to the hype.