With Apple and Google making headway with mobile payment solutions, PayPal is now entering the league following its announcement to acquire mobile payments platform Paydiant.
While the name doesn’t ring a bell immediately, Wellesley, Mass based Paydiant has been the driving force behind mobile payments for companies like Subway, Harris Teeter, Capital One and many others. Paydiant has helped build mobile payments, offers and loyalty into their own mobile applications. They also provide the mobile wallet platform for MCX whose members include many of the world’s largest retailers including Walmart, Target, Sears, Wendy’s, Exxon, CVS and many others. MCX was recently in the news for one of their apps called CurrentC, another competitor for mobile wallets like ApplePay.
PayPal hasn’t revealed terms of the acquisition but ReCode reported that its a $280 million deal and will include technology, customer relationships and about 70 Paydiant employees.
The Paydiant team wrote a letter to the public- “By joining the PayPal family, Paydiant will be able to scale our white label wallet platform and offer value-added benefits to our customers that only a combination of our two companies can provide – world-class risk management, 24 x 7 customer support, loyalty programs and mobile offers, an open payments architecture that supports all mobile operating systems and global reach into more than 200 markets and 162 million active digital wallets. PayPal’s resources will enable us to push the boundaries of innovation for our retail and banking customers.”
The acquisition is still subject to certain customary closing conditions, including regulatory approvals; however the acquisition is expected to close in late March or April.
“With the addition of Paydiant, PayPal becomes an even stronger business partner for merchants.
Using Paydiant’s platform, our merchant partners can now create their own branded wallets to accelerate mobile-in-store payments and drive consumer engagement through mobile payments, loyalty, offers and the prioritization of preferred payment types, such as store branded credit cards and gift cards,” Dan Schulman, PayPal President and CEO Designee noted in their blog.
Similar to PayPal, Paydiant’s technology agnostic approach means that merchants can use any mobile payment technology – QR codes or NFC – that best suits their business. Along with acquiring incredible technology, PayPal also gets Paydiant’s team of mobile developers, business leaders and visionary founders Kevin Laracey and Chris Gardner.
For Paydiant, Gardner told TechCrunch that the deal was a no-brainer because it gives its wallet technology significantly more scale and firepower. If that’s the thinking for a larger startup, imagine the proposition for the hundreds of other, and smaller mobile payments and mobile commerce startups out there.
(image credit: Beau Giles)