Apple, PayPal Both Made Major Watch Payment Moves Tuesday

When Apple released its software developer kit on Tuesday (Nov. 18) for the payment-enabled Apple Watch, it was signaling that its watch is coming soon. But not soon enough for PayPal, which also rolled out its watch-like payment mechanism support for its Pebble app, on the same day.

“Unlike the Apple Watch and its associated payment system, PayPal’s app doesn’t require a connected smartphone to use. It also doesn’t support NFC-based transactions. Instead, it generates a payment code that can be used to check out and charge an order to a user’s account. In some stores users will also be able to check out simply by checking into the store through the app,” noted a 9to5 Mac story. “Another difference between the two payment systems is the fact that the PayPal app can only charge your account on that service, while Apple Pay works with most credit and debit cards, giving users greater control over where the charges will show up.”

For a Pebble payment to happen, the retailer has to already accept PayPal. “You can also receive payment notifications while on-the-go through our app – without taking out your phone,” PayPal said.

But wait, you say. This is all mobile payment, but it doesn’t seem to have much need for a mobile watch. PayPal is hoping developers will integrate these capabilities for wearables. “With the addition of the PayPal app for Pebble, the PayPal app is now available across all available wearable platforms, including the latest Android Wear devices as well as Samsung’s Gear 2, Gear S and Gear Fit. So no matter which is your favorite smartwatch, we’re making it really easy for you to pay at local stores right from your smart watches. Instead of pulling out a wallet, you pay right from your wrist.”

And if the user’s favorite watch is an Apple Watch and they want to use it in-store? That’s where things get interesting. Apple is saying that it will sharply restrict who can leverage its NFC capabilities, which could lock PayPal out from the Apple Watch. But if the payment code is displayed and the merchant takes PayPal, the Apple Watch could theoretically be used to drive sales to PayPal. Well, as they say in the land of clichéd news story endings—please forgive me—watch this space.